Disney Expansion Plans??

[keishashadow]

Received this yesterday in investor newsletter...aka blue sky concepts.;)


Disney Parks eyes stand-alone hotels
Wednesday February 7, 10:23 pm ET

LOS ANGELES (Reuters) - The Walt Disney Co. (NYSE:DIS (http://finance.yahoo.com/q?s=dis) - News (http://finance.yahoo.com/q/h?s=dis)) is considering "blue sky concepts" of creating smaller theme parks and stand-alone hotels, retail, dining and entertainment centers, Jay Rasulo, chairman of Disney's Parks and Resorts told analysts at a conference on Wednesday

Building stand-alone hotels in urban areas where families already travel would give Disney the chance to reach out to parents who feel their children are still too young to appreciate a trip to a Disney theme park, Rasulo said.
Along those lines, Disney could locate versions of its Downtown Disneyland, a high-end retail, dining and entertainment district, in urban areas far from its parks, he said. The company also was exploring alternatives to full-size theme parks, including "a smaller, deeply immersive park" that would offer consumers a more interactive experience at higher prices.


These ideas are "blue sky concepts" that will not be executed unless the new businesses could achieve a high return on invested capital, Rasulo said.
Disney also was looking into expanding its water park offerings beyond Typhoon Lagoon and Blizzard Beach and possibly adding ships to its two-vessel cruise lines, Rasulo said.
Rasulo had little to add about the lackluster performance by Hong Kong Disneyland, which opened in September of 2007, and failed to meet first-year attendance target of 5.6 million.
"Hong Kong Disneyland developed a little more slowly than we expected in 1999 when the deal was put together" but the company was confident of its growth trajectory, he said. "We identified some challenges to be addressed in the near future in sales and marketing and seasonality," he added.

[Luckymommyx2]

I had just read something similar on the Orlando Sentinel website. As much as I love Disney I don't think it's a good idea. It wouldn't be Disney to me if it's outside of Disney...you can't create that same magic outside of the parks IMO. I'd rather they invest the money back into the parks.

The only thing I think everyone would be on-board with ;) is the addition to their cruise line. People have been wanting more ships with new places for quite some time.

I'm interested in reading what other DIS'ers have to say.

[PatriciaH]

They kind of tried that with Disney Quest and it those closed pretty fast.

[ziggystardust]

They kind of tried that with Disney Quest and it those closed pretty fast.

I was going to say the same thing :)

[keishashadow]

Hard Rock Hotel is opening a small theme park w/hotel in Myrtle Beach next year...

bet Disney sets up one too, either w/hotel/DVC or stand alone.

[bicker]

This article is explicitly about "blue sky concepts" -- it isn't about what Disney is planning to do, but rather just about what they're thinking about considering.

[quiltymom]

[QUOTE=keishashadow;16897201]

"offer consumers a more interactive experience at higher prices."

Now, why doesn't that surprise me?

I know that they had a Club Disney located in Newberry Park, CA a few years back, but it closed after a while. I wanted to take a peek inside to see if it was too "big for DS (who was one at the time), and they wouldn't allow it without paying for an hour of playtime first.

Who knows if it would work, but as someone already posted, it just wouldn't be Disney somewhere else!

[CanadianGuy]

I could see this working if it was done properly.

The problem with DisneyQuest is that it was a brand extension that didn't follow. Kinda like Kelloggs H-2-0 water. It didn't follow logically. It HAD to be a destination unto itself. And it was too darned costly.

DisneyQuest was the wrong idea at the wrong time.. poorly executed and it didn't fulfill any easily understood or conveyed 'need' in the consumer's mind. Bad strategy from start to finish.

Now.. if Disney were to look at building something with a hotel and indoor entertainment complex that could be ported to different cities..

Imagine a Disney themed hotel with an entertainment area featuring a few ride type things like the Buzz Lightyear Spin ride... maybe a short 25 minute show like they have at the theme parks (Beauty & The Beast, Aladdin or Voyage of the Little Mermaid.) It could have a version of "One Man's Dream" ... maybe even Pirate and Princess themed attractions? An indoor tea cups ride.. A Haunted Mansion type attraction where you target ghosts a la Buzz Lightyear... A "Toy Story" play area.. whatever.

Perhaps an indoor mini-Main Street USA would anchor each hotel with stores in a street setting with the facades done up like Main Street USA.

Such an attraction could feature props, sets or costumes from the latest Disney theatrical aimed at families. It could feature character meet & greets from time to time.. Pin trading.. It would of course house a Disney store with a larger-than-the-average-mall selection of items. In fact, they could and probably would have exclusive merchandise just for these 'Resort-Attractions' .

Eventually they could port things like the Soap Weekend at Disney World.. into a bit of a touring show running for a weekend at each of these hotels. Meet your favorite soap star -- closer to home.

They could use naming from well known Disney restaurants as part of the draw.

Something like that could be a draw both for hotel guests and for locals. It could be an adults' romantic evening out.. it could be a teenager's first date... it could be an afternoon with the kids or a weekend outta town shopping and spending time with the family in a Disney atmosphere.

Done properly -- the vertical branding Disney has between the parks, the movies, the ABC-TV, the ESPN brand.. could carry over to these locations. It could be logical brand extension.

Think of it like 'Disney Lite'. Marketed like "A taste of that Disney feeling when you can't go all the way to Florida."... or "Experience the Magic .. Closer to Home"

THAT is a very different concept from DisneyQuest. And I believe if properly executed and if it was to draw on the logical brand feelings about Disney already in the consumer's mind ...

It COULD work very well... AND it could wet the appetite for those who haven't taken the plunge of a full-on WDW vacation.. and urge them to do so.

[EDIT: Just reading thru this again - I can almost SEE the commercials for this in my mind! ]

[micksterlee]

I have always wondered why Disney hasn't opened some Disney themed restaurants featuring animatronics and occasional visits from characters.Seems like places like Chucky Cheese have great success with this concept.

[CanadianGuy]

OMG Yes..

Imagine having the TimeKeeper greet you at the entrance to the restaurant and have him doing a running spiel till your server was able to seat you!

J

[Mickey28]

Why would you want to water down the brand? Bad idea from the get go. What makes going to Disney so special is that if you don't live in close proximaty(sp) to the parks and you're a big fan it's a big deal when you do get to go. I use to work for Hard Rock Cafe and when I started they were just opening the 50th store after 25yrs. As soon as they were bought out by a larger corporation they began a massive expansion and went to over a hundred units in the next 5 years. Now I know many of you have been to a HRC and at one time probably only got to go to one when you were on vacation. However, most of you probably have one close to your hometown or in your hometown now, and it is no longer a big deal to go to one. That's why their business has dropped more than 50% in the last 5 years. Noone cares if they go to a HRC because they can go anytime. If they even care to go at all. Sorry to make this so long, but if you water down the brand and make it too available it removes the element of making it special. JMHO.

P.S. Please don't compare Disney and Mickey to Chuck E Cheese.

[ransom]

It'll be interesting to see what, if anything, comes of this.

There are three main concepts outlined in the article.

1) A Disney Hotel Line: "Building stand-alone hotels in urban areas where families already travel would give Disney the chance to reach out to parents who feel their children are still too young to appreciate a trip to a Disney theme park, Rasulo said." I'm not sure how this plays to Disney's core competency. Having hotels near the theme parks makes sense, because it allows the company to better control the guest experience (and capture the guest dollars). But expanding that into arbitrary cities all over the world?

2) Disney Retail Line: "Along those lines, Disney could locate versions of its Downtown Disneyland, a high-end retail, dining and entertainment district, in urban areas far from its parks, he said." Too bad they sold off the old Disney retail stores, eh?

3) DisneyQuest Line: "The company also was exploring alternatives to full-size theme parks, including 'a smaller, deeply immersive park' that would offer consumers a more interactive experience at higher prices." Too bad DisneyQuest had to be closed everywhere outside of Orlando due to unprofitability.

Ah, well. It's all blue sky stuff, but it's sort of disheartening to learn that they're apparently thinking of revisiting their failed past rather than moving into the future.

[CanadianGuy]

Well I agree that it *COULD* be watering down the brand...

But done properly .. it could serve as a feeder experience to the theme parks.

I gotta be honest, when they launched the cruise ships.. I had my doubts. But that seems to have worked VERY well.

Yes... something like this could go horribly wrong.

That's what they said about Walt's original idea for an animated mouse.. Disneyland.. then Disney World...

Disney still takes chances. I like that. Of course not everything works (LightMagic at DL anyone?)

J

[jayandstacey]

I could see this working if it was done properly.

.....

Now.. if Disney were to look at building something with a hotel and indoor entertainment complex that could be ported to different cities..

Imagine a Disney themed hotel with an entertainment area featuring a few ride type things like the Buzz Lightyear Spin ride... maybe a short 25 minute show like they have at the theme parks (Beauty & The Beast, Aladdin or Voyage of the Little Mermaid.) It could have a version of "One Man's Dream" ... maybe even Pirate and Princess themed attractions? An indoor tea cups ride.. A Haunted Mansion type attraction where you target ghosts a la Buzz Lightyear... A "Toy Story" play area.. whatever.


I'm tracking with you. A multi-use building complex (retail, hotel, even office space) mixed with entertainment would be a draw. And on that scale (even with smaller rollercoasters) the whole thing could be indoors, allowing year-round operation in any climate.

Many posters complained with "If I want to do Disney, I want to do it right" and fear saturation. But given Disney's breadth, you might go for different experiences. So you might only go to your new local Disney spot for an adult dinner and a movie, but take the kids to Orlando for the "big show."

Yes, Disney Quest failed and Disney will have future failures. But as with any business, growth should always be explored, and Disney has always succeeded in the long run.

[keishashadow]

For my family a smaller type of any disney park would be a great diversion.

Since we live too far to comfortably drive to the world, we're lucky if we get to go 2 - 3 X year, even with ap's

We visit other local (within couple hundred mile) parks & attractions additionally each year. :thumbsup2 If a smaller one was built in that range, we'd be there instead.

There is a saturation point (for some, the rest of us are mouse junkies).;)

[ReggieB]

There was talk of Disney doing something in Singapore a year or so back, in terms of some sort of entertainment center. However I do know they have opened an animation branch out there, so I'm thinking the rumors got the nature of the venture a little wrong. But the idea of some sort of entertainment complex has been out there for a bit.

[keishashadow]

An additional Wall Street Journal article has come out as to more details...

as in mini-parks w/accompanying hotels/DVC both in US & Caribbean; link on DVC boards.

Interesting to see what transpires.

Do hope they don't foresake upgrading the existing parks w/new attractions, etc. in this endeavor.

[MJMcBride]

Do hope they don't foresake upgrading the existing parks w/new attractions, etc. in this endeavor.

now there in lies the problem

[Luv2Roam]

I think this is a good idea all they way around.
First, Disney is already in the hotel business. They are all set up and can be ready to go in no time.
They bring Disney to their guests. Remember how we all use to write or say we would go to a Disney Store for our Disney fix? Guests will just check in to a hotel to be immersed. :woohoo: No need to take a cruise. Just stay over night if need be, without having to travel to FL, CA or overseas.
And the brand name will mean security and quality to travelers.
And think of the marketing they could do! Almost endless possibilities between the parks, DCL and Adventures by Disney.
The parks are a different segment than what these will be. I don't see not having this new brand means more park perks.
I think it is a plus all the way around.

[doubletrouble_vb]

This could possibly work even if old plans were recycled...provided it was implemented outside the US. I keep stumbling over the notion of "urban areas". In what urban area that is a tourist destination in the USA could this possibly be done affordably? Atlanta maybe...but why not continue on south a few hundred miles.

[Another Voice]

In what urban area that is a tourist destination in the USA could this possibly be done affordably?
Affordability is not exactly the market Disney is going after. Like the cruise line or the tour service, Disney is expecting people to pay above premium prices simply because these resorts will be have the Disney name.

It's not by chance that the Grand Floridian was the resport mentioned as one that will be cloned.

[MJMcBride]

Affordability is not exactly the market Disney is going after. Like the cruise line or the tour service, Disney is expecting people to pay above premium prices simply because these resorts will be have the Disney name.


and people do. I know nothing of the tour service, but from what I understand the cruise line is very well done and organized (having been on Carnival it must be better than that)

[jayandstacey]

Disney could do very well in the indoor waterpark hotel business.

Right now, the 'pure play' company in that space is Great Wolf Lodge, with maybe 7 locations in the US. They took an early lead two years ago, but faltered and haven't kept pace with competitors. Everyone from Holiday Inn to independant operators are biting - there are now oevr 30 such parks in the US.

The draw? You can charge $400 a night for a hotel room and get away with it - and do it year round. Just like at WDW.

The Wisconsin Dells are saturated, but pretty much the rest of the US is open. And all the other operators lack the Disney extras - shopping, known characters, promotional tie-in to other stuff (like WDW).

Disney could put up 5 of them around Washington DC alone (or maybe one giant one) and, I think, make some good return on their money.

[Another Voice]

and people do.
But people treat the cruise line as WDW's fifth theme park. They go on it to prance with the character and eat Mickey shaped food. The cruise is a complete vacation, just like a trip to WDW. There's no competion, no other sights to see.

There's a real question if anyone (as in the normal travelling American public that is the vast majority of Disney's customers, not the people on this board) is going to pay three hundred bucks a night to do the same thing in Salt Lake City. Are visiting Seattle really willing to see Experience Music in the day and then dine with rubber headed characters at night? Will normal people think that Yellowstone is enhanced or trashed by a Brother Bear Water Park?

[raidermatt]

I think this is a good idea all they way around.
First, Disney is already in the hotel business. They are all set up and can be ready to go in no time.
They bring Disney to their guests. Remember how we all use to write or say we would go to a Disney Store for our Disney fix? Guests will just check in to a hotel to be immersed. :woohoo: No need to take a cruise. Just stay over night if need be, without having to travel to FL, CA or overseas.
And the brand name will mean security and quality to travelers.
And think of the marketing they could do! Almost endless possibilities between the parks, DCL and Adventures by Disney.
The parks are a different segment than what these will be. I don't see not having this new brand means more park perks.
I think it is a plus all the way around.

Disney operates hotels, yes, but only clusters in a few locations. They don't do anything like what Hilton, Starwood, Marriott, etc. do.

Also, yes, we heard many say they went to the Disney stores for a Disney fix. But Disney still wasn't able to make the stores work.

I'm not saying nothing in these plans could work, just that its got a lot of very legitimate question marks, and Disney's past forays into this kind of stuff have had spotty results at best.

[larry_poppins]

Does Disney realize that if they build stand alone hotels all over the place they will have to act like Marriott and HIlton? Better value, better service.

Also they will have to value their customers instead of taking them for granted. All "normal" hospitality companies have "reward programs" for frequent guests. I am partial to Hilton HHonors. If Disney is going to charge $300 for a room and Hilton is going to charge $249 and give me Hilton HHonors points guess where I am going to sleep? I have never understood why Disney does not reward their best guests.

Larry

[EUROPACL]

I have never understood why Disney does not reward their best guests.

Larry

Clearly you've never been blessed with the towel hotel animal.

http://cdn.tripadvisor.com/Images-g150793-d254471-b1167039S-Room_service_leaves_us_a_towel_animal-Villa_Premiere_Hotel_Spa-Puerto_Vallarta_Pacific_Coast.jpg

[Another Voice]

If Disney is going to charge $300 for a room and Hilton is going to charge $249 and give me Hilton HHonors points guess where I am going to sleep?
You just don't get it.

While Disney will charge more, have smaller rooms, provide fewer services, offer fewer amenities, be more rigid in room assignments, be in less desirable locations, and be staffed by outsourced employees - they'll make up for it by using the word "magic" in each and every sentence of marketing they produce.

[TheDogbots]

see they will never do this, because that would mean bringing jobs back to the U.S.A.... phaw! who does that!

hey wait maybe they can bring back the animation divisions, scatter them around the country and put them behind glass for kids to see at the mini-parks! :P


but for real, at first i thought perhaps this may be an interesting idea... the idea of mini parks intrigued me... but they would have to be the size of DL and have three hotels each to bring a draw... and at that point you are just building another DL.... but if each one was different (ie did not copy anything else in the USA, though Disney sea could be done over here i think) then people would probably come... you could easily build a northern park indoors, you would just build in large "dome" pods that would connect to a central hub. if the total amount of attractions included 50% that were different i think it would work, but only if they achieve 50% originality. i think there would be huge draws to getting in a car and driving 300 miles for the weekend. stick them near major airports, buy tons of land around the mini park and you have room for expansion if it becomes hot... if it doesn't take off move the rides to existing theme parks and sell the place... no money is wasted on development because the content is reusable elsewhere...

I could see this working in Texas, the NE (Albany, NY?), DC area, Great Lakes area (around Toledo, OH?,) perhaps around Salt Lake City, St. Louis, and perhaps up in the NW somewhere. I suppose you could even do one of the indoor parks up in Ontario. I think it is very doable. Since people will drive for the name Disney, they should shoot for areas that have the most travel corridors to population centers (hence naming Toledo rather than Chicago for the great lakes) The key is to make the places not as extreme as WDW, so that WDW would still be the "mecca" of the Disney Pilgrimage, besides WDW would still get 95% of the international travel. the downside is DL may suffer from such a plan, but lets face it DL is in a part of the country no one likes to visit anyway... ::ducks::

The more i think about it, the more i like it... Disney just needs to make sure they can hit the crucial 50% originality mark or there would be no reason to visit the mini park...


Also, the water park idea that someone mentioned is an ok idea, i think that would work better on a mass scale, here in Erie, PA we had the worlds largest indoor waterpark put in about five years ago (yeah I am sure someone beat it within a month...) it does extremely well, and has pretty much destroyed the one classic theme park we had left (which inst much of an accomplishment siince its in the middle of the city, and practically building into the lake because of no room) Disney could easily make a name in this industry, but the question is, would they want to? i think the cheaper prices of competitors would win out in the long run... pay 50 bucks to waterslide with mickey, or 25 to do it by yourself? a waterslide is a waterslide... even when its crushin gusher... or whatever it is called....

OVer all i think Canadianguy was on the right track with his first ideas...

Oh definitely have to add... that though i think it would be neat, i think it would be more logical to concentrate on throwing in new quality attractions into WDW and DL (not just spin and shoots like buzz and the other new pixar ride) rather than building new mini parks... but if they wanted to do both i wouldnt be opposed lol.

[raidermatt]

Disney already showed what it can do with a mini-park, and its sitting next to DL giving away free tickets while management continues to try to figure out how to fix it.

Even a "mini-park" is going to cost hundreds of millions of dollars, and they won't have the luxury of relying on an MK or DL to co-market with it.

Something like that just seems WAY to risky for them, especially given the fact that they haven't proven lately that they have the kind of ability needed to even have a good chance to pull something like that off.

A water park... maybe. But like the hotel idea, now they'd be going against established competitors. Plus, does a water park bring the kinds of margins they would be looking for? Water parks don't bring tourists looking to have signature dining experiences and buy plush, they bring mostly kids who don't spend much in souvenir shops. See Six Flags for how that strategy has worked out.

I don't know, I guess some of the things they mentioned COULD work, but I keep coming back to the same point: Are things like this really a better investment than what they could do with their existing resorts?

[mark&sue]

I'd like to see something in Spain, but then I am buying a vacation home out there and not so sure what to do with my dvc points. There is always the disney med cruise but not keen on going back to DLP as too french!


Susan

[Tinker_]

I may be crazy-- but I really hope they do this! I would be very happy with a character meal restraunt like Liberty Tree Tavern within driving distance! We live in OK, and if something like this was built in TX, we would be there A LOT. AND- it wouldn't stop us from going on our WDW trips-- just help give us our fix!

[ursijam]

I think that the much more likely option for the experience would be to tie in the hotel/mini-park into an area that is an established tourist destination.

Take the most of the Adventures by Disney experiences and enhance it with the hotel/mini-park on the front/back-end or in the middle and I think that you would have that as a general destination as well as drive more traffic through Disney as a general travel organizer.

[Jakey]

I think this concept would work quite well if properly executed. This may be the reason for so many rumors of parks being built all over the country. Disney is making inquiries about property and doing their research.

Hyatt, Hilton, Mariott, all of these hotel chains are busy building huge resorts and even Vacation Club properties all over the country. Why would anyone want to go to these unthemed properties if Disney built their much more immersive version? I think Disney sees this going on within the hotel and tourism industry and spies a niche they could greatly exploit.

I know for our family, it would not curtail our visits to WDW at all but they would get a lot more of our money if they built something like this near us in Texas. Since we're DVC, it would enhance that as well if they included point use as an option or built a DVC resort as well.

Hyatt Hill Country Resort near San Antonio has been in operation for a number of years now and has a small water park and golf course as its offerings. They are now in the process of building a Vacation Club resort adjacent to it. If they can do this, Disney can do it better!