DEBATE: Does Disney understand their market?

[HB2K]

Nope, as Matt correctly pointed out, my question is simply whether IOA should be considered a "full" or "complete" park and, if so, why hasn't it met expectations much less seen TDS type numbers.

That's a very important question.

The Brand Name.

And the more Eisner does to cash in (i.e. kill) the Disney brand name by associating products which don't fit with the public's perception of the brand name, the more he helps competitors gain marketshare.

The most important & valuable asset ANY company can posses is their brand name reputation. Once you've tarnished it, it's next to impossible to get back to where you were.

Just give Universal & others time. If they keep building parks similar to IOA, and Disney keeps trying to profit off of their name alone, you'll see a difference in numbers.

 

[All Aboard]

Weighing in late, as is the case these days...

"and USF's new attractions would hardly be considered "destination attractions"

I'm not sure what your definition of a "destination attraction" is, but (at least from the hype) the Shrek and supposed Mummy attraction seem to be of high E ticket caliber. Terminator is the best 3-D experience I've seen and Shrek is supposed to top it (according to Universal.)

This discussion has gone off in a bunch of different directions, but I'll focus on why I think DAK missed the mark with the public.

The chief problem with DAK for us has nothing to do with theming or immersiveness, it's simply attraction volume and attraction quality. Disney took a chance on developing a park that relied heavily on folks "taking to" Maharaja, Pangani, the Oasis & Discovery Island Trails as "attractions" rather than "theming." Kind of like Main Street, a walk through Adventureland and Frontierland being called "attractions." They really aren't, they add to the experience, but they are not really attractions in the minds of most people. "Attractions" as most folks are used to are rides and shows. Given that, DAK opened with very few "attractions" and it hurt the public's perception of the park.

Single example - shortly after DAK opened in 1998, a woman from my office came back from a trip. This was before I had been. Naturally I was very interested in hearing her reaction. In short it was "awful, barely anything there to do." Unfortunately, I think that's the reaction of a whole lot of people. They are accostumed to big "attraction counts." Think of how many rides and shows there are at the Magic Kingdom.

Now, let's look at the attractions that are there. In my opinion, there are three knockouts - Kilimanjaro (but I'd prefer they drop the Little Red thing) It's tough to be a bug and Festival of the Lion King. Kali is way too brief and packs all of it's punch into a single drop, beyond it, there is little or nothing. Dinosaur is built on the same technology as Disney's arguably best stateside attraction. Yet, it falls miserabley short by most accounts. Drive, stop, not our dino, drive, stop, not our dino... Disney can (and has) done so much better than that.

And then to correct these shortcomings, they added Dinorama.

Clearly, there's nothing new in this post, no insights or thoughts that we haven't hashed out time and time again. And, it's nothing more than personal opinion. But, I just have to believe that these are the reasons DAK isn't packin' em in. So, in this case, I really do think that Disney misguaged the market. They offered a product that didn't mesh with the public's perception or desire for a theme park. Or, at least not as much as Disney expected it to.

 

[stlphil]

Okay, I'll jump into the fray...

Maybe it is because Michael is right after all, well half-right anyway. Maybe it really is about the brand.

You can have a great, full featured, fully themed, filled with WOW factor park- but that is not sufficient, and the competitors know it.

You have to have the family-friendly brand as well, and it's only when you put the two together that you get the really huge attendance numbers that generate the really big bucks that make the whole effort worthwhile.

What Ei$ner forgot, or didn't realize, or misunderstood, is that it is also not sufficient to only have the brand and not have the great park. Which leads to AK, DCA, DSP all being disappointments.

Does Disney understand their market? Walt did. But what really distinguishes the current Disney from Walt is that Walt was not afraid to make a mistake (and he made plenty of them), and the current crew is paralyzed by the fear of making a mistake.

 

[raidermatt]

You see, I'm beginning to think that the benefactor of any reduced value of a Disney vacation won't necessarily be another theme park...why? because nobody who operates theme parks really appears to be working to seize upon this perceived current weakness by Disney.

The only piece of this I would take exception with is that Universal certainly appears to be working to take advantage of Disney. They have invested a large amount of capital over the last 4-5 years.

They may not be doing everything right, and they may or may not succeed in becoming a destination resort on a par with WDW, but you can't say they haven't been trying.

But otherwise, yes, guests who choose to stay away from WDW (or visit less), will not necessarily go to other theme parks, even if those theme parks are trying to become a resort destination.

This leads right back into my contention that WDW should be viewed as a niche player in the resort destination industry, as opposed to the giant in the more narrow theme park industry. Most guests who decide not to vacation in WDW don't instead go to Universal (though Universal is trying to change that). They go to Hawaii, New York, Europe, Washington DC, The Caribbean, etc.

I'd love to hear some of you alls thoughts on why Disney's competitors aren't going for the jugular now that Disney is perceived as wounded...

Because their thinking is similar to Disney's. That's a big part of the point. Disney used to think differently. Now, they are becoming just like 99% of the other companies in the world.

And again, Disney has the built in advantage of characters and theme park assets built-up over 45 years. Everybody knows the public will buy Disney's brand of entertainment, if its done the way they expect Disney to do things.

But will they buy it from Busch?

If somebody wants to be the next WDW, they not only have to top what Disney does today, but they also have to top what Disney has done for the last 45 years.

Who's got the stones to try that multi-billion dollar gamble? Universal? Maybe. They've taken the first steps. The question now becomes:

"And THEN what are you prepared to do?"*


*Semi-obscure movie reference

 

[raidermatt]

...why hasn't it (IoA) met expectations much less seen TDS type numbers...

Several reasons.

1- As others have said, BRAND. The Disney brand has been tarnished by many different things, but when it comes to theme parks, its still carries more weight than any other company. As stlphil says, Eisner is right when he talks about the value of the brand. The problem is that value is not a God-given right. It was earned with the hard work and innovation of many people, most notably Walt himself. The value has diminished, and it will continue to do so unless things are done to truly ENHANCE the brand, not just capitalize on it.

2- OK, admittedly, I haven't been to either IoA or TDS. But certainly in the pictures it appears TDS has a lot more detail and themeing than IoA. That's not a knock on IoA, its just that some of the stuff at TDS just simply looks amazing. I don't think it has as many attractions as IoA, but given the choice, most people will choose quality over quantity when it comes to attractions.

In other words, based on the "Disney Standard", IoA maybe be closer than DCA or DSP, but it ain't no TDS.


One thing I'm curious about is the height restrictions at TDS. The Disney website vaguely refers to restriction on quite a few attractions, but I couldn't find the specific info on which ones had height restrictions, and what those restrictions were.

I'm of the opinion that IoA falls into the same trap as Disney has been, which is to provide height restricted rides, and kiddie rides, but not enough "whole family" attractions.

TDS may have the same issue, but overcomes it with spectacular themeing and detail.

 

[DVC-Landbaron]

Matt,

There aren’t as many as "several" reasons and yet there are hundreds. But it can all be boiled down to one. And you said it all. (Several days ago, I was tempted to respond similarly, but really didn't think it was worth the effort (It seems I'm entering a JJ state of mind!), those that understood, I didn't need to tell and those who refused to see, would never 'get it'!!).

In other words, based on the "Disney Standard", IoA maybe be closer than DCA or DSP, but it ain't no TDS.

Perfect!!!!! I would only add that it is also ain't no "Walt" Disney. But it certainly come close to Disney ®.

 

[Bob O]

For the other companies involved in the theme park business like paramount/Busch the theme parks are a smart part of their business plan as compared to disney where it is a major part and has been a cash cow that helped to make up for the numerous bad decisions the company has made. I think for Universal also the theme park busines is a small part of the overall company and none of these companies put the emphasis on theme parks like disney does. Now for Universal that could change considering what happens to their ownership but they are putting money into their parks with new attractions(no not spinning carn rides). Attractions like Shrek can be part of a major campiagn as likely can be the attraction going into the old Kong building while disney has MIS which is being paid for by another comnpany and has been reduced in both size and scope of the attraction if the rumors are true.
Now i havent been to TDS so i cant say how the park is other than pictures but from what i have seen of IOA personally and the pictures ive seen of TDS i dont see IOA taking a backseat. As for customers, Universal's park in Japan also set major attendance records when built so you are dealing with a different marketplace that seems to love most things American.
And the disney brand is being tarnished by eisner with alot of the tarnish added since 9/11 and all the lawsuits they are involved in like the Pooh lawsuit now and the ovitz/katzenberg debacles which both cost disney alot of money and bad press world wide and a loss of the pooh suit will only magnify things. People expect more from disney due to the greatness of walt and it is being squandered and the upcoming generations may not have the love for the company/name as alot do here.

 

[Another Voice]

The problem with both Universal and Disney focused on the resort concept rather than on making a theme park. The current business model that everyone subscribes to is that “if I get x number of guests to extend their stay for y number of days at z dollars per day, we’ll be rich.” Animal Kingdom and Islands of Adventures were both simply resort expansion projects: neither park was strong enough to lure people into flying a thousand mile to see them. The local market and the annual market (time share owner, habitual repeat visitors) in Orlando isn’t large enough to support the additional parks. Out west, California Adventure was another resort expansion project that didn’t interest visitors or the substantial local market. Same deal with Disney Studios Paris.

None of these projects were “full sized”, they were simple additions. And the business models were constructed accordingly. Instead of figuring out ways to attract visitors, Disney and Universal simply assumed people would show up anyway based on the strength of the existing attractions.

The problem is the public still thinks in terms of separate full-day parks. You can whine and complain and fuss about why simply looking at the plants at Animal Kingdom make it a full-day park, but the general public doesn’t see it that way. Nor do they see it as “more to do than every before”. A typical will guest will make the decision to drop five grand for WDW on how they answer “is Animal Kingdom worth the trip”. They answered that question for Island of Adventure with a “no” for the same reason – a nice park but not worth the trip. Gee, in Anaheim people figure it isn’t worth a thirty minute drive.

RULE ONE: Make something people want to see and they will beat down the turnstiles to give you money.

As for Mr. Scoop’s complaint that no one else is stepping in – of course they’re not. It’s good old American business blinders at work. And Mr. Scoop could have made the very argument in 1955 about if amusement parks were profitably, how come no one else was in the business. It took Walt Disney five years of convincing to get over that question; it’s going to take people without his skills a little longer to get there.

 

[Peter Pirate]

Seems to me that you just proved Scoop's point Voice. There will be no new innovation no big, wow parks and no give 'em quality and they'll come philosophies because there is no more Walt and the corporate world does not care to take such "risks" in its strategic planning. Blame Eisner & Disney all you want but nobody is winning at this game because nobody is playing.

Once again Scoop was right on when he said that only the niche market could possibly subscribe to and be successful in these areas because once the company (any company) has reached certain heights and goals it then becomes time to eat or be eaten...And the cycle continues once again...

 

[Bob O]

Scoop Is wrong!!! It may not be today or tomorrow but somebody will step up to the plate and challenge disney like Universal has. It could be somebody buying Universal due to their money woes or some one we arent even thinking of at this time. As a aside Bill gates has been buying shares of Six Flags, now this doesnt mean he is out to make Six Flags into disney but you never know what person/group of people will see a opening and decide to get involved, escpically us disney contuines to falter and loses the rights to the pooh characters which is a possibility. None of us know what the future may bring and im sure 5-10 yrs ago no one would have imgained disney being in the shape it is today when a small company they partnered up with(pixar) beats them at their own game in creating family movies.

 

[Another Voice]

In other words Mr. Pirate, you’re basically saying that since Disney is now a big time corporation all we should hope for is the safe, the bland, the unimaginative, and the uncreative tripe that we expect from everyone else.

You, sir, may lower your standards. I choose not to.

If Disney is unwilling to provide the level of excellence that they have in the past, then good riddance to them. If all you’re looking for is a brand experience, then buy a pack of Mickey stickers from K-Mart and slap them on cans of Cheez-Wiz, loaves of Wonder Bread and the cassettes of ‘The Care Bear Movie #19’. Instant Disney® product without the fuss.

What attracted me to Disney in the first place were their products and their attitude. They create things simply for the joy of creating and they worked damn hard to make them as well as possible. A lot of times it didn’t work, but when it did it was genius. And most of all, things were always moving forward onto something new, something exciting, something different.

These days all that appears to be gone. The same rides copied and cheapened; the same movies remade and cheapened. Everything reduced, down-scaled, cut to a lower level. Wonder is no longer cost-effective; amazement doesn’t reflect in the stock price, and the old standards can’t be achieved anymore.

Hooey. Those are just excuses for people who don’t even want to try.

Imagination has nothing to do with corporate size, economics or lowered public tastes. Imagination is only the result of hard work and confidence. Any group, no matter how large or how small, can achieve quality if they wish.

Disney doesn’t care to achieve that level anymore. It’s not because they are structural prohibited, it’s not because powerful outside forces are stopping them – they choose to be mediocre. They have chosen money over creativity, an easy choice to make in Hollywood and all businesses.

I choose not to settle for mediocrity.

 

[Peter Pirate]

I'm always settling for mediocrity according to youse guys...

If Disney is unable to provide the level of excellence they have in the past, then good riddance to them.

HEY!!! I agree. I'm just not dilluding myself as to the difference between "what I hope for" and what I think will really happen.

I'm with everyone here in hoping that a return to the days of yore can be achieved. I want new and creative everything but business logic tells us this probably won't happen doesn't it? You said so yourself in so many words. Don't shoot the messenger. I'm no spawn of satan because I happen to be able to see the diffrence between what I hope for and reality.

Look at the current situation. No news, little in the rumor mill. Is Eisner gone? Nope. Any hint of it? Nope. They won the series business is picking up at ABC and the Parks will slowly drift back to where they were. Disney is not the train wreck you naysayers portray nor are they in panic mode.

Sorry to say Disney will continue to drift on its current course. I'm sure there will be some glimmer of hope (Space) and I'm sure there will be clunkers (a lame show replacement for HOND perhaps). But nothing is going to change with the rapidity that everyone here wants.

It is what it is and if it does slip to total mediocrity the drop will not be perceptable to most but more importantly if there is no competetor to rise to the occasion or to challenge Disney's lead, then the Company WILL just become another bright pop icon with new generations garnering little of the magic that we past two or three generations have had the luck to be a part of...If it happens as Voice says, "good riddance"...But it won't be happening by next year...

 

[PKS44]

out there...lurking in the east... quietly building up power and money and knowledge about how to actually make money AND be creative and quality minded is a company called OLC (Oriental Land Company) In the what may end up being one of the worst economic down cycles in history, they have succeeded in the business of leisure/vacation/theme parks, etc...just because the foolish and shortsighted in this country cannot figure out that making money by cheapening yourself is self-destructive does not mean that "nobody" else is doing it the right way. Ford, GM, Chrysler --all were kings...once--Toyota was just a little Japanese car maker....now, the number one selling car in this country is a Toyota. If Disney and all the others want to keep conducting business as if they have no other choice than to be average- some day someone will take them on and take them out...Peter Pirate needs to read the piece over on mouseplanet by Dan Steinberg about the business of magic and Augmented/Specialty/Commodity markets and providers-if not OLC, some clever and greedy company will eventually folllow the money which sits at the end of a rainbow reached only by following REAL successful business strategies for the long term...it is the only way to distinguish oneself in this market...all other strategies are doomed to fail...but the demand will always be there--people want to have fun.

Paul

 

[Peter Pirate]

OLC has stepped out on a limb once and succeeded. Do you really think they'll be doing it again?

OLC doesn't have a stirling record for employee or customer concern but has a big reputation as a money maker.

Before anyone trumpets this company as the new ideal lets wait and see what they do next.

 

[PKS44]

Originally posted by Peter Pirate
OLC has stepped out on a limb once and succeeded. Do you really think they'll be doing it again?

OLC doesn't have a stirling record for employee or customer concern but has a big reputation as a money maker.

Before anyone trumpets this company as the new ideal lets wait and see what they do next.

Once?? Tokyo Disneyland is the Number 1 visited themepark in the world (success once). Tokyo DisneySea was derided by the US Disney people as a folly while they built the much more sensible DCA -TDS has enjoyed enormous success exceeding all expectations (success TWICE).

As for having concern for the customer...they at least make an effort to impress their customers with the quality of their product-from the buses to the hotels to the parks and the attractions- they lavish detail and quality on their on customers from what I have read...and the customers keep coming for more...what a concept.

Paul

 

[airlarry!]

Ugh. I have to agree with the Pirate on this one.

Everything that I read when I used to hang out on the fool.com boards poiinted out that the success in Tokyo has been because of the partnership of Disney and OLC, and not because of OLC.

AV may disagree with me on this one, but we had some pretty informed people who stated that OLC is not Walt incarnate. In fact, they are a Tokyo version of Ei$ner's perfect ideal for the parks. Spend a little, charge a lot, and rake in the bucks.

But apparently there is a kicker in the whole deal. OLC had to meet IMAGINEER standards anytime they do anything with the resort. Little thing called a license, you know.

So we get a great partnership...kinda Wells-ian...or Royian...but in reverse. There the money people who were desperate to add onto the resort could not cut corners because they had the awesome talent of the Imagineers riding herd on them to create the best. It is why I have said that the TDS isn't something Walt would have done, but if Walt would have wanted to build a water version of the MK, than he would have built TDS.

Here in the States, we've got the reverse...here the money people have control instead of the creative people. But don't fool yourself into thinking that OLC is a knight ready to rescue the parks. I think there is not enough evidence. What we do have evidence of is that if given the proper support, the Imagineers can reate something so astounding to the general public that they will line up for hours just to get in.

I will applaud OLCs efforts, as outlined by Marc Borrelli's excellent series at www.mouseplanet.com to create a beautiful wonderland that all of us should plan to visit, as soon as the crowds start thinning out...

 

[larworth]

Why hasn’t somebody responded

Here are a few reasons:

A. There are few existing competitors who could react

The regional parks did some migration in this direction (themed queue’s, simulators) in the early 90’s. They have since decided “theme” parks are not their gig. Too big a strategic shift for the Premier/Paramount/Cedar Fair’s to make. BG may still have some aspirations, but too small a unit within AB to take this kind of risk. These companies have capital spending issues just competing in their own niche, let alone take a step-out play.

Universal had already hoped to take more advantage of their decline. How could they justify another huge investment at this point. Corporate instability had paralyzed them until lately. They are just now testing the waters to see how vulnerable Disney may be.

For a new entrant the business case would have to be pretty clear, which it is not.

B. The decline is not yet cataclysmic or irreversible.

Even a weaker Disney will continue to pull in it’s share of customers for years. With saturation/economic uncertainties it would not be clear, enough market share, would be available to justify the large investment it would take to "out-do" them. An entrant would also want to be sure Disney is now incapable of mounting a serious counter-offensive. I don’t think one could make that assumption today (although they are working on it).

C. The time lag here is pretty long.

Once someone did decide there was sure vulnerability (don’t we still debate it), how long does it take to get a park into the construction phase. Look how long it takes Disney to do market feasibility, site location, land purchase, approvals, and concept design for a MK clone. How long would this take for a new entrant???? A decade??? An outsider would have had to arrive at the vulnerability conclusion in the early 90’s to be close to greenlighting a new park today.

I don’t think we can take the lack of industry reaction as any indication the decline is not real. The Disney management team knows how big a competitive advantage they have (in terms of being easily displaced by another theme park entrant not by alternative vacation options) and knows they can leverage this position in favor or short-term versus long term gains for many, many years. That doesn't make it right.

 

[raidermatt]

HEY!!! I agree. I'm just not dilluding myself as to the difference between "what I hope for" and what I think will really happen.

Maybe this is our disconnect. I don't think the rest of us are making predictions here. We are offering opinions for what SHOULD be done. While I wouldn't call it a pipe dream, I think we all realize it might never happen.

I'm just of the opinion that the future is an unknown, and rather than resolve myself to what I think could happen, I'd prefer to call for what should happen.

Make sense?

With respect to OLC, I don't know enough about how they operate to offer much of an opinion. However, I will say that being motivated solely by profits does not have to result in the opposite of what the old Disney philosophy would have resulted in. I think if Disney just put more of a focus on sustaining and gowing LONG TERM profits, and understanding what truly creates those profits for them, the end results of their efforts would be something much closer to what most of us are looking for.

It may not be perfect, and it may not have the "soul" of Walt, but at least it wouldn't be inept.

What we do have evidence of is that if given the proper support, the Imagineers can create something so astounding to the general public that they will line up for hours just to get in.

Your Airness, this is EXACTLY what I mean. One doesn't have to be Walt, or even think like Walt to grasp this concept. One only has to understand the business that Disney is in, and want to profit from it.

He was the creative version of Cy Young. Cy Young set some records, he did some things with a baseball, which will never be done again. Sure, now and then some young gun will start piling up wins early on, but Cy's records always survive. Maris' fall, Cobb's fall, Ruth and Gehrig's record fall, but not Cy's.

True. We may never see anybody start from scratch and build another Disney, just was we may never see anyone win 500 games.

But the concepts behind Cy's success are still valid and can be used by others (in fact they are...).

You seem fixated on saying that we are calling for another Walt. That is simply not true. Concepts like long-term focus, customer satisfaction and showmanship were not invented by Walt, and they did not die with him.

Again, this isn't "settling" or any other type of easy out assignment of the unoccured, it's just reality.

Perhaps defeatist is more accurate...

I mean, simple reality requires that statisically, somebody would rise up and defeat Disney in their perceived time of vulnerability.

Where do you get these statistics? Multiple posters have laid out multiple reasons why this simply isn't true, yet you continually go back to "Walt was one of a kind", and your version of statistical reality.

Quite simply, the theme park industry cannot afford to take the risks which the movie industry can because it cannot survive the inevitable bombs nearly as effectively as the movie industry. I know you know and realize that.

Seriously Scoop, do you really believe what you are typing? You can't get much more of an absolute bomb than DCA. I guess that was your idea of a low risk? I don't see how the theme park industry could handle too many more "low risk" projects like that.

After all, I again repeat the refrain that nearly every CEO is in the game to make money---and if they saw a great way to make money, it only makes logical sense that they'd leap at the chance.

But you see--they don't see it. The creative types see it, but they don't have the business muscle, while the ones with the fiscal muscle to pull it off either don't see it or don't care to strain their eyes lest the realize somebody needs a new prescription.

Of course they don't see it. If they did (in particular Eisner), we wouldn't be having this discussion. But what does what Eisner sees have to do with what he should see?

You try to prove that a philosophy won't work FOR DISNEY (another key point you repeatedly miss) by pointing out that they don't use it.

Then, you lament that many people do "get it", but they just can't turn it into relality, so we should just accept what is given to us by those who can't see creativity/quality/guest satisfaction going together with profts.

I'm hard pressed to come up with a better example of a "settleing" or defeatist mentality.