WSJ: Even Disney Is Worried About The High Cost Of A Disney Vacation (gift link)

[wdwmagic]

From the statements today:

In fact, a recent survey of 3,531 U.S. adults by Morning Consult, commissioned by the Walt Disney Company, revealed that a strong majority of families with children under five:

• Said nothing compares to a Disney vacation…
• Said that a visit to a Disney park gives memories that last a lifetime and can’t be replaced…
• …And those that had visited Disneyland or Walt Disney World felt the vacation was worth the expense

Case closed then

 

[Ayla]

It wasn't said explicitly in the article, but there have been multiple high-level meetings where Disney exec asked for ideas on how to attract the "young families" demographic, who are not visiting the parks like their parents did.

The concern there, besides the short-term revenue, is that the parks operate a lot on nostalgia: your parents took you, you take your kids, and so on. Like DVC, that's something that guarantees a certain level of base business every single year.

For decades after World War II, each generation of American kids could look forward to being slightly better off, economically, than their parents. And that meant more visits to Disney World, because they had more money.

That's not true for Millennials - those born between 1981 and 1996 - ages 29 to 44, smack-dab in the middle of the largest demographic of Disney World visitors. They're worse off, financially, than their parents.

It's more bad news for Gen Z - those between the ages of 18 and 34. This CNBC article says that 45% of them still rely on their parents for financial support.

Back to the Disney meetings about "young families" (YFs).

The execs asked a wide range of groups for ideas on how to get more YFs into the parks.

I won't name the person or the group, but one of them had a presentation with data similar to the WSJ article, and said "Lower prices. They can't afford it otherwise."

That message was not well-received. As I said earlier, the outcome of the meeting was to task Marketing with coming up with better ad campaigns.

This same meeting happened regularly for a couple of years. The "lower prices" person eventually got tired of it and quit.

So this generation of young families can't afford the parks. The next generation? No way.

Eventually, through inheritance, those kids will be part of the largest wealth transfer in history. But that's decades from now, and they won't have fond memories of the parks because they didn't go.

There will be very little inheritance for our kids (who grew up going to WDW almost every year). We plan on spending (ie enjoying) what we worked our entire lives for, and retirement at 54 means we'll be using a big chunk of it, with zero guilt.

 

[Jrb1979]

One point I think a lot of folks are glossing over is that according to the numbers Len presented, the middle class has less purchasing power now vs. when WDW opened in 1971 when adjusted for inflation. So, if your target demographic is physically incapable of providing growth or even maintaining profit levels what do you do given the realities of being a publicly traded company?

People keep acting like all they have to do is be affordable and every thing will be great when that is 100% not the case. I am sorry but if you are a company that relies solely on disposable income your main focus can't be on the groups that don't have any.

The actual mistake they made was gutting the perceived value while they drove pricing upwards.

I don't think people are glossing over it. The problem is those that can afford their product aren't repeat visitors for the most part. There isn't enough of them to replace those they lost.

 

[TrainsOfDisney]

I’ve had to pay to get a meal that’s of comparable quality to something on land, but this wasn’t always the case. Is your experience with Celebrity different?

Celebrity has pretty good food in the dining room - I’ve heard it’s better than other lines. I’m going to guess it’s not too drastic of a difference from Norwegian.

Now Virgin… they don’t have any extra charge restaurants - everything is included. It’s also adults only so a different market. They also include basic Wi-Fi and they don’t have all the little art auctions and photographers like the other lines. It’s super chill.

Sadly I’ve yet to actually go on a Disney cruise.

 

[Creathir]

It wasn't said explicitly in the article, but there have been multiple high-level meetings where Disney exec asked for ideas on how to attract the "young families" demographic, who are not visiting the parks like their parents did.

The concern there, besides the short-term revenue, is that the parks operate a lot on nostalgia: your parents took you, you take your kids, and so on. Like DVC, that's something that guarantees a certain level of base business every single year.

For decades after World War II, each generation of American kids could look forward to being slightly better off, economically, than their parents. And that meant more visits to Disney World, because they had more money.

That's not true for Millennials - those born between 1981 and 1996 - ages 29 to 44, smack-dab in the middle of the largest demographic of Disney World visitors. They're worse off, financially, than their parents.

It's more bad news for Gen Z - those between the ages of 18 and 34. This CNBC article says that 45% of them still rely on their parents for financial support.

Back to the Disney meetings about "young families" (YFs).

The execs asked a wide range of groups for ideas on how to get more YFs into the parks.

I won't name the person or the group, but one of them had a presentation with data similar to the WSJ article, and said "Lower prices. They can't afford it otherwise."

That message was not well-received. As I said earlier, the outcome of the meeting was to task Marketing with coming up with better ad campaigns.

This same meeting happened regularly for a couple of years. The "lower prices" person eventually got tired of it and quit.

So this generation of young families can't afford the parks. The next generation? No way.

Eventually, through inheritance, those kids will be part of the largest wealth transfer in history. But that's decades from now, and they won't have fond memories of the parks because they didn't go.

This is why their stock is in deep trouble IMO.

They have completely forgotten/ destroyed the nostalgia opportunity on both sides of the problem.

1. They have priced younger families out, so the future generations don’t grow up going / dreaming of going.

2. They are actively destroying nostalgia on multiple levels within the parks. Rides, lands, restaurants, re-themes, IP integration, all decimates the memories of those who are still paying to return. So the gripe when they return, or feel downtrodden about what was once there, and either don’t return again (with the future generations) or they gripe and discourage the return.

 

[Ayla]

Seems this may be Disney's response to the WSJ article:





Here's the full post with more details on current offers at Walt Disney World and Disneyland Resort:

Disney Offers: Everything You Need to Know | The Walt Disney Company

Prepare for your next visit to a Disney resort by learning about the promotional deals and offers available across a variety of ticket, dining, & hotel options.

thewaltdisneycompany.com

I want to see the survey questions. We all know any company (and esp Disney) can write questions to get the answers they want, or have very leading multiple choice answers.

 

[Jrb1979]

…there’s a reason for that

Maybe. I also see more of the middle class that used to go to Disney at these places like Dollywood, Myrtle Beach and Pigeon Forge.

Many here view Disney as a high end vacation similar to a cruise or European vacation.

 

[GhostHost1000]

I want to see the survey questions. We all know any company (and esp Disney) can write questions to get the answers they want, or have very leading multiple choice answers.

On a scale of 1-10 how much do you enjoy a Disney vacation?

Results presented:
Everyone enjoys a Disney vacation!

 

[GhostHost1000]

Josh’s response to the article would have been better if he didn’t respond at all. They are so out of touch

 

[TheMaxRebo]

I want to see the survey questions. We all know any company (and esp Disney) can write questions to get the answers they want, or have very leading multiple choice answers.

Question: will you remember this trip?

Guest: I will remember the bills I had to pay

Disney: memories that last a lifetime confirmed!

 

[larryz]

Hotel Our family’s hotel prices have risen 29% more than inflation since 2011. The really surprising thing here is that a two-night stay at Disney’s All-Star Resort is slightly cheaper in 2025 versus 2018 after adjusting for inflation.

Statistical magic. Sadly, as many who read here can testify, wages have not kept up with inflation. The average wage increase since 2011 hit about 10%; that 19% deficit between wages and Value resorts is keeping many from staying on property if they can even go after considering huge inflation in ticket and food costs.

 

[TalkingHead]

What’s funnier is the implied acknowledgment that adults with children ages 5 and over don’t find WDW to be worth it.

 

[Splashin' Ryan]

I think people are especially tired of the overused "this is the best time there's ever been to visit!" trope that not only did they end the article with but consistently push every year. For over a decade now they've relied on big summer attraction openings to encourage people to visit and while that happened in the past too, most often people would just visit simply because it was a nice place and experience to visit. In this way, Disney has kind of shot themselves in the foot by promoting that its only "the best time" to vist when something new is there. You need to keep people coming back even without new things. Then you realize things that keep people coming back are the cohesiveness of a park, pleasant staff, pleasant guests and not being rushed. All of which have been lost or not invested in at all.

 

[larryz]

Which makes me question the business decision - is it better to sell just 100 pretzels a day for $8.50 or 500 pretzels for $3.50?

Wait a minute -- I have to boot up Roller Coaster Tycoon III...

 

[Disstevefan1]

Seems this may be Disney's response to the WSJ article:





Here's the full post with more details on current offers at Walt Disney World and Disneyland Resort:

Disney Offers: Everything You Need to Know | The Walt Disney Company

Prepare for your next visit to a Disney resort by learning about the promotional deals and offers available across a variety of ticket, dining, & hotel options.

thewaltdisneycompany.com

I hope everyone understands how much of a scam this statement is:
"We haven’t increased the lowest-priced ticket to Disneyland since 2019"

 

[Trueblood]

From Disney this morning:

Disney Offers: Everything You Need to Know | The Walt Disney Company

Prepare for your next visit to a Disney resort by learning about the promotional deals and offers available across a variety of ticket, dining, & hotel options.

t.co

I'm just going to point out that the sentence that starts with "The thing we hear from millions of guests who visit our parks..." is the definition of survivor bias.

Wow, that article is tone-deaf. I know is was Rasulo and no D'Amaro, but we don't forget things like "slowly wean our guests off discounting" and I don't think the idea has fallen aside.

I'm concerned that my next trip will be my last because it will become too expensive.

 

[larryz]

Right. It's like McDonald's tripling the price of a Quarter Pounder and expecting the drive thru to be filled with Mercedes and Porsches.

But it's like they take the pickle, onions, and sesame seeds off the QP in the process.

 

[lentesta]

Case closed then

"The people who could afford to come said it was affordable."

 

[britain]

From Disney this morning:

Disney Offers: Everything You Need to Know | The Walt Disney Company

Prepare for your next visit to a Disney resort by learning about the promotional deals and offers available across a variety of ticket, dining, & hotel options.

t.co

I'm just going to point out that the sentence that starts with "The thing we hear from millions of guests who visit our parks..." is the definition of survivor bias.

In fairness, they could be pointing out that long-term nostalgia play is still strong. But as you point out the main issue is that there are fewer and fewer people who are going to have that nostalgic pull.

 

[larryz]

From what little I've seen of him I thought he was funny. Much better performer than that joke of a half time show I sat thru tonight but that's entirely off topic.

Like the man said at the end: Turn The TV Off.