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

[Calmdownnow]

I know WDWMagic doesn't want politics injected, but it's surreal to read this thread with no mention of the expected impact of thousands of people who have recently been pink slipped (pending legal challenges), industries and small businesses that are dependent on Federal dollars (pending legal challenges), predictions of what will happen to the prices of durable goods (and everything else), and snowball effects I won't even mention, on affordability. Especially for customers up and down the East Coast. Is the International market going to hold up? The words "decrease aggregate demand," as an economic plan were mentioned like today. My Great Recession / Financial crisis + 1970s badness alarm bells have been ringing non-stop for the last 2 weeks. Has no one here been impacted by what has been announced so far? Does Disney have any plan for an economic downturn?

This thread feels very 2023/24, with everyone talking about a past economic cycle. If you are a Disney financial analyst in Feb 2025, you are desperately crunching numbers that show your exposure to a) a (voluntary. ie. non-governmental) Canadian tourist boycott; b) a potential expansion of that boycott to include other countries in Latin America and Europe on a rolling basis as America becomes less popular; c) the shock of a sudden reduction in income or job security for middle class public sector employees; d) the immediate shock of less money flowing into the neighbouring southern states as the Musk cuts hit; e) the wage inflation that can be anticipated when the bottom tier of the workforce is removed through deportations; f) the increased inflation arising from tariffs on imported goods (including Stitch and Moana t-shirts); and g) what the tariffs on steel and aluminum are going to do to that Magic Kingdom and Animal Kingdom expansion. The nature of the conversation within the company will have moved on from "what is the EPIC impact", to what is the economic impact of what is coming down the path.

 

[GenChi]

The price for a basic single day (OOS) ticket to one WDW park can buy you a full season pass to just about any regional theme park in the country, and often an upgraded pass with parking, one free daily lighting lane, access to other parks, additional perks, etc. Of course not including discussed upcharges or other necessary travel expenses for Disney.

It's really not surprising that WDW for most people has turned from a once every few years to an at most once in a lifetime visit just to say you brought your kids once, with interest in return visits very low. Inflated cost, feeling like they are scamming guests, and general quality decline when quality defined your parks over regional does that. Things are going to get worse the more the middle class is made non-existent. Starcruiser was your test to see if only upper class whales could sustain these resorts, we saw how that went so you can see how this is now an internal panic.

 

[lazyboy97o]

For both companies for that matter. It's so odd how things have changed. Disney and Universal are heading to the cheap route, while parks like Dollywood are all about guest satisfaction and world class experiences

The scale is nowhere near similar. A cheap Universal or Disney project is still more expensive than what Herschend would spend on an attraction. The demand is also greater than what would be necessary for Herschend.

 

[Fido Chuckwagon]

I’ll believe Dollywood is serious about it’s parks when it figures out how to solve its hornet and wasp problem.

 

[monothingie]

Disney killed the golden goose and it was just a matter of time till the tipping point arrived.

The first two generations after wdw open were converted into fierce brand loyalists. Wowed ans swooned, they regenerated with the next generation through the kids growing up and repeating the cycle.

Disney created ‘fans’ who would actually shape their lifestyle around wdw vacations. Borderline cult-like… and the reputation earned ensured a new feeder line of new recruits.

But in the 2000s they started taking this for granted. New waves of leadership focused on cashing in verse ensuring the cycled continued.

Then Disney started directly chipping away at the things that nurtured the loyalists. They started treating guests like “your dollars are replacable”. Disney basically stopped building brand loyalty and instead focused on capitalizing on the guest… even blatantly in front of them.

Defense like “everyone else does it…” highlighted exactly that. Disney was no longer different…. The cycle was broken and now Disney no longer had blind faith from their customers. People openly feel nickled and dimed. It’s every family for themselves….

So the armor is gone… you are exposed to just see how much you can land before customers give up on you.

Disney was coasting on it’s past reputation while not restocking the barn. Generational loyalty is gone. Wdw becomes more ‘one and done’… something people grimmice through to say they did it… but no longer join the cult.

It accelerates into a death spiral as disney monetizes more to sustain growth while doing little to indoctrinate new loyalists… and making its own barrier to conversion even taller.

Now sustaining growth is too hard… you are too big… defending your own price differentiation makes you too inflexible.. and it costs too much to keep innovating so you slumble and slow even more.


Disney’s turning their back on their brand loyalty and what created it killed the golden goose.

Disney turned everyone into park commandos… then monetized it and everything short of taking a dump… and then can’t find their way back to what actually created that kind of lifelong fan.

All empires eventually fall…

 

[DisneyHead123]

It is being built to the standard of a child-focused regional park. It will by its very nature not have signature attractions to the standard of their other parks, and it will exclude entire demographic swaths of the population with the experiences offered. Again, with Disney parks versus Disney cruises, it's "same quality, same demographics, different but potentially overlapping persona"; for a Universal destination park versus the proposed Universal children's park, it's "different quality, extremely narrowed demographic, completely different persona".

You always, always mischaracterize what people say about regional parks. No one is saying that they don't have a place and are unworthy of a visit. In this case, all that is being said is that if you have made a name for yourself with premier destination amusement parks, creating lesser regional parks that don't meet the same standard for attractions, service, and entertainment may negatively impact brand perception.

I’m not up on the Universal Texas park so can’t speak to that.

I will say, however, that I’m actually a fan of Disney doing some kind of “Disney Lite” experience that is more dispersed throughout the US. I do understand that they have not had luck in this area in the past. That said, I look at the success of a place like Great Wolf Lodge and think that shows the market is there. I’d love something like an expansion of DVC into Disney centric family entertainment hotels.

 

[Agent H]

Depends.

How many vacations have you personally planned and paid for, yourself?

How many people were you planning for and paying for?

Well none but we are pass holders

 

[Vegas Disney Fan]

I’m trying to discuss basic economic indicators. Which I don’t believe are against WDWMagic rules. And extremely relevant to affordability. Unlike litigating the rules, which is the direction you took, and a discussion I do not wish to discuss.

Economic indicators are absolutely relevant, you just have to keep politics out of it.

Asking how a potentially decreasing federal workforce could affect WDW is perfectly fine, bringing up the politics behind those changes is a third rail though and sure to get deleted.

There’s ways to discuss how current events could impact Disney without bringing politics into it.

 

[WDWhopper]

Each year, Chevy sells millions of vehicles in the low to mid 5 figures. Ferrari sells about 8500 vehicles priced in the mid $300,000 range. Of course it’s less cumbersome for Ferrari, but they are much more susceptible to downturns in the economy, since they are a luxury brand with a limited customer base. Disney is attracting more luxury customers, but they will be more susceptible to a continuing downturn, since they have moved away from the middle class. I think the problem at Disney is that a lot of their development teams are younger college graduates without experience with downturned economies. The quick buck looks more attractive to them. Anyone who has lived through a downturn would understand that you do much better when you diversify your customer base. Catering mostly to the upper class results in more booms and busts. Keeping an even and steady business going with a mix of middle and upper class, is typically the best way to go. It’s the classic Tortoise versus the Hare.

 

[MrPromey]

I’m trying to discuss basic economic indicators. Which I don’t believe are against WDWMagic rules. And extremely relevant to affordability. Unlike litigating the rules, which is the direction you took, and a discussion I do not wish to discuss.

Another words, you'll be mad if they delete it.

Have a lot of thoughts on this myself (we probably agree) but bowing out because the number of debate posts generated over my opinion on the Universal Texas park was enough heated controversy for me for one day.

I've seen how every discussion about what's at the source of what you're bringing up start pretty much the way this is and how it devolves and frankly, don't have the stamina for it.

You'll notice now that you've broken the ice, there are a lot of people who have something to say who didn't want to be "the one".

Anyway, I look forward to reading but not adding to that discussion for however long it's able to last.

 

[Calmdownnow]

Each year, Chevy sells millions of vehicles in the low to mid 5 figures. Ferrari sells about 8500 vehicles priced in the mid $300,000 range. Of course it’s less cumbersome for Ferrari, but they are much more susceptible to downturns in the economy, since they are a luxury brand with a limited customer base. Disney is attracting more luxury customers, but they will be more susceptible to a continuing downturn, since they have moved away from the middle class. I think the problem at Disney is that a lot of their development teams are younger college graduates without experience with downturned economies. The quick buck looks more attractive to them. Anyone who has lived through a downturn would understand that you do much better when you diversify your customer base. Catering mostly to the upper class results in more booms and busts. Keeping an even and steady business going with a mix of middle and upper class, is typically the best way to go. It’s the classic Tortoise versus the Hare.

How deep do you think the downturn is going to be? And how exposed do you think Disney is to the anticipated downturn?

 

[flynnibus]

Each year, Chevy sells millions of vehicles in the low to mid 5 figures. Ferrari sells about 8500 vehicles priced in the mid $300,000 range. Of course it’s less cumbersome for Ferrari, but they are much more susceptible to downturns in the economy, since they are a luxury brand with a limited customer base. Disney is attracting more luxury customers, but they will be more susceptible to a continuing downturn, since they have moved away from the middle class. I think the problem at Disney is that a lot of their development teams are younger college graduates without experience with downturned economies. The quick buck looks more attractive to them. Anyone who has lived through a downturn would understand that you do much better when you diversify your customer base. Catering mostly to the upper class results in more booms and busts. Keeping an even and steady business going with a mix of middle and upper class, is typically the best way to go. It’s the classic Tortoise versus the Hare.

Ferrari doesn’t need to have the number one vilume in the world to keep afloat… they sell at specialist volumes.

Meanwhile… disney has lime 7000 deluxe level hotel rooms it tries to fill 365 days a year

 

[Agent H]

It can be both not bad and also something a 25 year old without kids who ignored all the marketing thinks they wasted their time and money traveling to when they get there and fully realize it was designed for someone 17 years younger than them.

Sorry, I meant 17 and 1/2 years younger.

As a parent, I can appreciate what Legoland is while acknowledging it's not meant for me, despite my eternal love for those little plastic landmines.

This is true I concur with everything you have said here but my point is when something mostly meant for all ages is objectively bad ie. minon villain con blast or (as a fan of the show this one hits particularly close to home) the ninjago ride and people defend it by saying it’s for kids that seems like a weak argument to me

 

[Vegas Disney Fan]

How deep do you think the downturn is going to be? And how exposed do you think Disney is to the anticipated downturn?

No one knows if there will even be one at this point, many of us have been expecting a recession for the last several years, so far it hasn’t materialized.

Even the goal of a 5-10% decrease in federal employees is roughly 100-200,000 employees, that can be offset pretty easily with one good month of hiring. If those jobs move from the public sector to the private sector it’ll have no impact at all, if they just disappear it could potentially start a chain reaction. Too early to know if it’ll have any impact on Disney at all though.

 

[Nubs70]

I know WDWMagic doesn't want politics injected, but it's surreal to read this thread with no mention of the expected impact of thousands of people who have recently been pink slipped (pending legal challenges), industries and small businesses that are dependent on Federal dollars (pending legal challenges), predictions of what will happen to the prices of durable goods (and everything else), and snowball effects I won't even mention, on affordability. Especially for customers up and down the East Coast. Is the International market going to hold up? The words "decrease aggregate demand," as an economic plan were mentioned like today. My Great Recession / Financial crisis + 1970s badness alarm bells have been ringing non-stop for the last 2 weeks. Has no one here been impacted by what has been announced so far? Does Disney have any plan for an economic downturn?

Did NASA have a plan for an O-ring?

 

[Vegas Disney Fan]

Ferrari doesn’t need to have the number one vilume in the world to keep afloat… they sell at specialist volumes.

Meanwhile… disney has lime 7000 deluxe level hotel rooms it tries to fill 365 days a year

I think companies like Chevy and Disney are far more exposed to economic downturns than a company like Ferrari, Disney need tens of millions of guests to stay profitable, Ferrari only needs a few thousand millionaires to stay profitable.

 

[MickeyCookies]

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.

Oof this hit a nerve. As a millennial — I just love watching the comfortable lifestyle of retired boomers while we struggle and pray that every single job we get doesn’t axe us.

Most of them will spend down that inheritance or give it all away to charity before they can pass it on to us. Ask me how I know

 

[Calmdownnow]

No one knows if there will even be one at this point, many of us have been expecting a recession for the last several years, so far it hasn’t materialized.

Even the goal of a 5-10% decrease in federal employees is roughly 100-200,000 employees, that can be offset pretty easily with one good month of hiring. If those jobs move from the public sector to the private sector it’ll have no impact at all, if they just disappear it could potentially start a chain reaction. Too early to know if it’ll have any impact on Disney at all though.

Is there a stated goal of getting rid of just 100,000-200,000 public sector employees? I missed that announcement.

Fired USAID staff alone (forget about their spouses) returning to the country will add around 25,000 to the job-seeker numbers, so I think the "goal" may be misleading -- but either way, I can't see their resume being submitted to WDW for housekeeping hires.

 

[Vegas Disney Fan]

Is there a stated goal of getting rid of just 100,000-200,000 public sector employees? I missed that announcement.

Fired USAID staff alone (forget about their spouses) returning to the country will add around 25,000 to the job-seeker numbers, so I think the "goal" may be misleading -- but either way, I can't see their resume being submitted to WDW for housekeeping hires

That was the stated target when they mailed out the early retirement buyout offer. It’s not unprecedented either, over 400,000 federal jobs were eliminated in the late 90s and it didn’t result in a downturn.

 

[hopemax]

The unknown is the downstream effect. Federal contacts and grant money went into the private sector, supporting private sector jobs. Private sector jobs dependent on federally funded research. Uncertainty isn’t good for business or decisions about expensive vacations.