Attendance Down, Revenue Up

[COscrapper]

Who says the decline in attendance was not desired? Spending STILL went UP.

I have it on good authority (friend who is at management level at Disney corporate in Burbank) that they are actively TRYING to lower attendance numbers in the parks. The ticket price increases are a measure to "reduce throughput."

I have a very good friend whose dad is an imagineer and was talking to her a couple days ago about all the price increases. She told me her dad says the main reason is to try to lessen crowds...that they do not like reaching capacity and having to close gates. People who spend tons of time and money on a big WDW vacation are of course not pleased to go to the parks and be told they can't go in. She said Disney does see that as a major problem...would maybe explain why they were calling people over Easter to ask them to go to a park other than MK?

I just wonder how high prices would have to go for people to actually stop going (paying).

 

[focusondisney]

The price increases will only get them so far. The strong dollar is keeping international visitors from coming over, and Disney has priced out a large swath of the American consumer. Families with young children aren't generally flush with extra cash for Disney world. Older travelers who do have the money to spend are looking for the high end experience. Disney's cutbacks on services for the deluxe resorts and the club level offerings will cause the travelers looking for the premium experience to look elsewhere. I see a lot of the repeat travelers to Disney beginning to question whether or not it's a good value now - that's got to hurt Disney.

You have described us! My DH & I have been traveling to WDW from Buffalo NY for over 20 years. It's been just the 2 of us for about the last 12. We go at least once a year, several years we have gotten APs & gone on 3 trips with them. Probably about 35 trips in all. We stayed at moderate resorts when we first started going with the kids. Now that it is just the 2 of us, we stay club level water view rooms at the Yacht Club. We do table service & signature dining. We have done tours, holiday parties & dessert parties.

We certainly aren't wealthy, but we have good jobs & discretionary income that we felt was well spent at WDW. Well, in the past, we thought that. Sadly, even we are beginning to question the wisdom of future Disney trips. The price increases of the resorts, tickets & dining are just out of control. But it is the cuts in service, lines for things like the Imagination ride at Epcot & the People Moverat MK & the slow release of new attractions that are really getting us. Seriously, we are paying over $600 a night for a club level room (with a discount!) and we need to wait in the lobby check in line to have someone escort us to club level to get checked in because Disney has gotten rid of the curbside greeters???!!! Recent reports from even the GF club levels where nightly rates are often over $1000 talk about skimpy food offerings & deteriorating quality.

We have loved our trips & will be truly sad to not go. But we are beginning to feel like suckers for continuing to spend so much money and get less & less service & value in return. We have a trip booked on a bounce back in September. After that we have talked about possibly going less frequently & staying in a regular deluxe or moderate level room. Maybe if enough people cut back their spending, Disney will stop all the crazy cutbacks.

We can hope, right??

 

[TLSnell1981]

I in. She said Disney does see that as a major problem...would maybe explain why they were calling people over Easter to ask them to go to a park other than MK?

I just wonder how high prices would have to go for people to actually stop going (paying).

Everyone wants to go to MK because the other parks are barely up and running....construction, rehabs, closures and outdated attractions. There's not much going on, except MK.

So many hotels to fill, but not much for the guests to do. This really is a huge mess.

 

[Glenn]

They talked about profits being up due to price rises at hotels & tickets. Wonder how much is due to cuts, cuts and more cuts in entertainments and little things? Increases in food prices for smaller meals, way less entertainment. Yes its pay more and get less.
Work in a larger place and only know 1 family that went this yr so far. Family of 3 took their daughter age 4 for the first time, starting school in sept. Mom didnt say much but it was nice to see her daughter have fun. Cannt see going back. Once there they did 1 character breakfast, canceled 1. Actually canceled most sit down dinners due to price & quality. So their daughter was happy to eat her favorite cereal in the room, pb&j sadwiches for lunch. In all she said they had fun by cutting way back on most things.
So wonder how much Disney loses by raising prices way up to the point people like this say no way?

 

[Mambo Junkie]

Hmmmm. . . Before reading, I wondered whether the decreased attendance was, as some have speculated, a desired result to enhance guest experience. Upon reading, nope - I was reminded about the dropping of Resident blackout dates to try to boost attendance, so the decline was not desired. And the article states they still missed analyst expectations, so apparently the price hikes were not intended to scare anyone away. It's hard to say whether price hikes caused any attendance drop, as many of the hikes are pretty new and lots of travelers plan their vacations much further out. I imagine quite a lot of people were kind of stuck with the increases at first because they felt locked into their plans already. I imagine there's a lag of a couple quarters to really assess the effects.

However, the article does somewhat refute the "it may not be good for the guests, but it's still good for the shareholder" argument. In the long run, what's good for the stockholder HAS to be good for the customer or something is wrong with your business plan.

While here this week I overheard several conversations about crowds and fast pass+ impact. The consensus is, people feel they are spending more and getting less, while having a lot of their experience diminished by having to deal with higher crowds. There were comments (I overheard from several groups) to the effect of how many more days they're having to spend in the parks to accomplish what they used to get done in less days. I noticed by lunch time most of the "hot ticket" fast passes were gone. I heard a great deal of complaining about things of this nature. I didn't let it affect me in any way because I am figuring out how to plan while giving the appearance of not planning. My DS and DH also commented on how much nicer this trip was without all the ADRs (I just planned 1 per day, except our Princess MK day), but I ended up canceling BOG (again!) at the last minute (walked up as they were turning someone away and told them I'd love to cancel and give this lovely group our reservation and they let me). We had decided to leave early. There are a LOT of changes at WDW, and cost increases, with lots of extra paid events, and either it's the last straw for some, or outpricing some, while others are frustrated trying to figure out the game plan that works best for them and their families.

 

[Darcy03231]

You have described us! My DH & I have been traveling to WDW from Buffalo NY for over 20 years. It's been just the 2 of us for about the last 12. We go at least once a year, several years we have gotten APs & gone on 3 trips with them. Probably about 35 trips in all. We stayed at moderate resorts when we first started going with the kids. Now that it is just the 2 of us, we stay club level water view rooms at the Yacht Club. We do table service & signature dining. We have done tours, holiday parties & dessert parties.

We certainly aren't wealthy, but we have good jobs & discretionary income that we felt was well spent at WDW. Well, in the past, we thought that. Sadly, even we are beginning to question the wisdom of future Disney trips. The price increases of the resorts, tickets & dining are just out of control. But it is the cuts in service, lines for things like the Imagination ride at Epcot & the People Moverat MK & the slow release of new attractions that are really getting us. Seriously, we are paying over $600 a night for a club level room (with a discount!) and we need to wait in the lobby check in line to have someone escort us to club level to get checked in because Disney has gotten rid of the curbside greeters???!!! Recent reports from even the GF club levels where nightly rates are often over $1000 talk about skimpy food offerings & deteriorating quality.

We have loved our trips & will be truly sad to not go. But we are beginning to feel like suckers for continuing to spend so much money and get less & less service & value in return. We have a trip booked on a bounce back in September. After that we have talked about possibly going less frequently & staying in a regular deluxe or moderate level room. Maybe if enough people cut back their spending, Disney will stop all the crazy cutbacks.

We can hope, right??

This is us too (although we travel from NH). Last trip for us was in 2013. We've branched out to other vacations and have been having more fun that our last WDW trip. Last summer we spent 10 days in the Orlando area and I really thought I'd miss going to WDW. I even planned to spend a day at DTD (or Disney Springs now) to get a bit of a WDW fix. It ended up we were so busy and having so much fun doing other things that we never made it. I never even missed it.

We'll eventually go back to WDW when some of the new attractions open up, but I don't see it ever becoming a yearly (or 2-3x a year) destination for us again.

 

[Nancyg56]

Has it been possible to get free dining over thanksgiving weekend and Christmas in years prior? Usually FD ends at least a week prior making either difficult unless a very long vacation of well over a week. Also seems that summer discounts have been a bit higher than prior years.

I have gotten FD starting the day after Thanksgiving. WE booked RO with a AAA discount and then 9 more on FD.

 

[mshanson3121]

I have a very good friend whose dad is an imagineer and was talking to her a couple days ago about all the price increases. She told me her dad says the main reason is to try to lessen crowds...that they do not like reaching capacity and having to close gates. People who spend tons of time and money on a big WDW vacation are of course not pleased to go to the parks and be told they can't go in. She said Disney does see that as a major problem...would maybe explain why they were calling people over Easter to ask them to go to a park other than MK?

I just wonder how high prices would have to go for people to actually stop going (paying).

I dont buy this. The only times they have to close gates are Christmas, New Years and 4th. 3-4 days of the year isn't enough for what They're doing.

 

[Nancyg56]

I believe there are a lot of factors in play here. When you ask people to pay top dollar for a trip they expect teh experience to match that. The changes that have taken place in the last 5 years are monumental if one has not vacationed in Disney during that time, so the shock can be mind bending.

My nephew's IL's are taking their family all 16 of them, to Disney in late June. They have DxDDP, and are staying at the Poly. WE are talking big dollars just on this group. Now it has been 9 years since MIL has been to Disney and she is planning as if it was 9 years ago. Dining is still not all booked, FP? Not yet.
I know there is still time, and I know they will have fun, but I also know there will be some grumbling when they get back home. My nephew asked how which spending money he needed to his family, and is planning on spending. You see there will be plenty of discretionary spending money because Mom and Dad paid it all upfront for them, but if they feel assaulted by crowds, cannot find last minute dining times or places that are reasonable for their family, and then begin to compare their memories of trips past to their new reality, there will be backlash in terms of future trips.

Add the people who like us, caution the last minute friends to think ahead, and they do....and then go to Lake George because they are not willing to spend that amount of money without a gaurantee that the experience will be worth it. Then we all have been treated to those people who hear we are going and feel the need to lecture on their recent disaster of a vacation.....all these stories add up.

There have been many theories that Disney Execs rely on lying those first timer's who plan once in a lifetime trips to carry their US parks and resorts. I tend to believe that may be true, although the "boots on the ground" have shown me time and time again that those front line CM's know they need repeat guests to be their cheerleaders. However, if that mindset is true, that the once and done folks are the backbone of Disney Dollars, perhaps there needs to be a huge Uturn pretty darn quick or next quarter will be even worse. Between increased costs, cutbacks in staff and entertainment, longer lines, and reduced hours, and more pay for play events, well.....

 

[nicko]

I have a very good friend whose dad is an imagineer and was talking to her a couple days ago about all the price increases. She told me her dad says the main reason is to try to lessen crowds...that they do not like reaching capacity and having to close gates. People who spend tons of time and money on a big WDW vacation are of course not pleased to go to the parks and be told they can't go in. She said Disney does see that as a major problem...would maybe explain why they were calling people over Easter to ask them to go to a park other than MK?

I just wonder how high prices would have to go for people to actually stop going (paying).

I'm not sure I buy this. I agree that the crowds are a really big problem. I also agree that long lines and heavy crowds are the number one dissatisfier for guests. If Disney truly wanted to solve the crowd problem they would do the following:

• Not reduce theme park hours as they have done this year as compared to previous years.
• Not reduce the summer water park hours across the board this summer.
• Not reduce EMH.
• Run all attractions all day and not run some of them at reduced capacity.
• Not eliminate shows and street performers that draw people away from rides.
• Add more shows and attraction now, not in 3-4 years. (See Universal for an example of how quickly E-ticket rides can be built.)

 

[Tinkalink]

I don't live there so Im not there everyday...but... We went the last week of March and the crowds were off the charts! And I mean at every park. The day we went to Hollywood Studios, you could not move in the Star wars area - that was at 10:30am. There was a line out the door and out of the exit ramp into the general just to make a light saber!
The posted online time for Magic Kingdom's park opening was 8am. We arrived at the MK at 7:15. It was packed going through security and the "turnstile". At 8AM we were in the MK, past the castle, into Fantasyland -the line for the Seven Dwarfs Mine Train was already at the entrance of Storybook Circus by Big Top Souvenirs. AT 8AM! We kept walking to Peter Pan's Flight and there was a 40 minute wait! GRRR! (This was the Thursday after Easter.)
On the positive side, we still had a blast being in the parks - we just had to make a few adjustments with rides, attitudes, shows, shopping and parades.

 

[Nancyg56]

I'm not sure I buy this. I agree that the crowds are a really big problem. I also agree that long lines and heavy crowds are the number one dissatisfier for guests. If Disney truly wanted to solve the crowd problem they would do the following:

• Not reduce theme park hours as they have done this year as compared to previous years.
• Not reduce the summer water park hours across the board this summer.
• Not reduce EMH.
• Run all attractions all day and not run some of them at reduced capacity.
• Not eliminate shows and street performers that draw people away from rides.
• Add more shows and attraction now, not in 3-4 years. (See Universal for an example of how quickly E-ticket rides can be built.)

I tend to agree. The cuts seem to be a desperate attempt to correct the numbers. Crowds can be controlled by running attactions at 100%, and increasing hours.

 

[mom2rtk]

I have a very good friend whose dad is an imagineer and was talking to her a couple days ago about all the price increases. She told me her dad says the main reason is to try to lessen crowds...that they do not like reaching capacity and having to close gates. People who spend tons of time and money on a big WDW vacation are of course not pleased to go to the parks and be told they can't go in. She said Disney does see that as a major problem...would maybe explain why they were calling people over Easter to ask them to go to a park other than MK?

I just wonder how high prices would have to go for people to actually stop going (paying).

I'm sorry but I'm not buying that storyline. Either that or they are a major company in conflict. Or maybe the right hand just doesn't know what the left hand is doing.

A company trying to reduce crowds does not lift blackout dates on some local annual passes leading up to Easter, one of the peak seasons of the year.

If they're trying to lessen crowds, why offer all the discounts this summer? Why offer free dining? Why continue to invest in prime time advertising?

There might be factions of the company that want to lessen crowds. Perhaps they feel it lessens the product they put out there. I could definitely see that being a desire of an Imagineer. But the people making the big decisions are going a different direction with it.

 

[Kona65]

When we first started going to Disney World, the pricing was high, and the attendance was low. You could go during the off season and enjoy yourself because of the low crowds. Disney started building cheaper resorts so that everyone could come to the parks. Attendance boomed, and quality went down. Now pricing is up, quality is down, and the crowds are getting smaller. But profits are up. You have to love Disney. Walt would be so proud.

 

[ellie05]

I just wonder how high prices would have to go for people to actually stop going (paying).

Well it seem we are there with decline attendance this first quarter.

But that's a double edged sword. Those price increases might have kept them profitable, but it apparently cost them enough that they missed predictions. I hope they are starting to see that there isn't an endless stream of people waiting to come through the gates and pay whatever it takes to have a Disney vacation.

I have seen a number of reports the last couple weeks of rooms being added to the free dining inventory. Lots more available than when it was first rolled out.

I think that with all the price increases late 2015 and very early 2016 they already saw decrease in attendance and then they decide to raise the prices as a desperate move not to loose money. They figure most people had already booked and will be going so the tier ticket prices came, the reduce hours (it might be Shangai or might be that they were going to go loose money), the food increase came, tier parking came, etc. All those changes were added within a very short spam.

I think the decreased attendance comes from a couple of factors. International economy not doing well. International visitors make about 25%. The US economy recover the past few years I think there was a big crow that couldn't affor Disney during the recession so when the economy recover they were able to do their one in a lifetime trip and now they are done. Universal has been slowly taking visitors from Disney and now with the price changes Disney push them over the edge.

The problem that Disney is going to be facing and we have seen that by the summer offers is that while they might say they want less people in the parks (which I don't think it true) is that they have a whole lot of hotel rooms to fill. I think price increases has also send some people offsite plus decrease attendance they are going to start having a harder time filling those hotel rooms.

 

[rteetz]

I tend to agree. The cuts seem to be a desperate attempt to correct the numbers. Crowds can be controlled by running attactions at 100%, and increasing hours.

The cuts are due to overruns in China and with MyMagic+

 

[ThurlFan]

Everyone wants to go to MK because the other parks are barely up and running....construction, rehabs, closures and outdated attractions. There's not much going on, except MK.

So many hotels to fill, but not much for the guests to do. This really is a huge mess.

This is really it in a nutshell. People will point to Pandora and Star Wars/Toy Story expansions and say "see, Disney IS doing something" - but the problem is they waited far too long to get the ball rolling. Epcot has fewer attractions now than when we started going 15 years ago. I believe the same is true for DHS. And while AK has added a headliner (one that I love btw) it still never had enough going on to keep people from rope drop thru dinner. At least people used to stay until the parade in late afternoon, but that carrot's long gone now. So what happens is everyone's all in on MK for the majority of their park days. We used to schedule 2 1/2 days of a weeklong trip for Epcot, now it's one day or one and a half days tops. We dearly love AK bit we're done before dinner and if we have park hoppers are looking for something more for the day. And we've never set aside more than a whole day for DHS and now we just skip it. this is why there's a 'capacity' problem. They fill the rooms on property and then on any given day most of those people are in MK instead of distributed among the four parks. Sure, when the new stuff is completed this will be alleviated but for the next few years while it's still under construction their reputation is going to take a significant hit from the 'OMG the crowds/waits/prices' reviews online.

TL/DR: Disney has done too little, too late, and too slowly.

 

[Nancyg56]

The cuts are due to overruns in China and with MyMagic+

I believe that in part they are. I also think that rapid uptick in costs when coupled with reduced services and staffing also are linked to the quarterly reports. I have never believed that within a corporation as large as Disney, any one event is responsible for changes, charges, or increased gains or losses. If you look at Shanghai or My Magic+ as individual slices of a pie, would either be enough ruin the numbers? I don't know.

 

[mom2rtk]

This is really it in a nutshell. People will point to Pandora and Star Wars/Toy Story expansions and say "see, Disney IS doing something" - but the problem is they waited far too long to get the ball rolling. Epcot has fewer attractions now than when we started going 15 years ago. I believe the same is true for DHS. And while AK has added a headliner (one that I love btw) it still never had enough going on to keep people from rope drop thru dinner. At least people used to stay until the parade in late afternoon, but that carrot's long gone now. So what happens is everyone's all in on MK for the majority of their park days. We used to schedule 2 1/2 days of a weeklong trip for Epcot, now it's one day or one and a half days tops. We dearly love AK bit we're done before dinner and if we have park hoppers are looking for something more for the day. And we've never set aside more than a whole day for DHS and now we just skip it. this is why there's a 'capacity' problem. They fill the rooms on property and then on any given day most of those people are in MK instead of distributed among the four parks. Sure, when the new stuff is completed this will be alleviated but for the next few years while it's still under construction their reputation is going to take a significant hit from the 'OMG the crowds/waits/prices' reviews online.

TL/DR: Disney has done too little, too late, and too slowly.

Totally agree. They are living with the results of cutting too many corners and not investing in the parks for too long. MK is a huge success, partly because it's such a great park with enough to justify the price, and partly because they neglected those other parks all along.

This is what happens when you invest in a ride rationing system instead of net new additions to the parks.

 

[dreiwhit]

I just wonder how high prices would have to go for people to actually stop going (paying).

We're actually borderline not going anymore right now. A Disney vacation costs double what our regular vacations cost us.

We wanted to go back in early 2016, but i'm not sure if we're going to have the money to go.

The economy hasn't been too good to my family and I for the past 10 years.....