Is the growth of DVC outpacing the growth of the parks?

[rutgers1]

I bring this up because, although we keep seeing one DVC resort after another open, there hasn't been much in the way of additions to the parks in recent years.

From my perspective, a new "regular" hotel on the Disney property generally serves to lure someone that might have stayed off-property previously, particularly when that new hotel is a value. However, DVC serves to bring someone back more frequently than they would have normally come to Disney. Take me for example. Prior to buying into DVC, I was on the "every other year" plan. Now, this year, I am coming twice, and I plan on going at least once a year for the immediate future. Although I am sure that not everyone is in my boat, I bet a lot of you reading this see a bit of yourselves in me.

So, with that said, will DVC put a crowd burden on the parks that they will not be able to meet?

 

[Chuck S]

If the parks become so busy that they are constantly crowded, Disney will be able to justify a 5th gate. DVC still makes up a relatively small percentage of overall WDW Park visitors, and to fill the parks take a great deal more people than DVC can provide, even if every DVC room were filled to capacity. Even if every on site room hotel room were filled to capacity, the parks would not be filled without off-site or local guests.

 

[Tara]

If the parks become so busy that they are constantly crowded, Disney will be able to justify a 5th gate. DVC still makes up a relatively small percentage of overall WDW Park visitors, and to fill the parks take a great deal more people than DVC can provide, even if every DVC room were filled to capacity. Even if every on site room hotel room were filled to capacity, the parks would not be filled without off-site or local guests.

I agree completely with this - a 5th gate is an enormous expenditure just in design and construction alone, likely requiring adding significant debt. Then there's the cost of operating the 5th gate (including labor), expanding transportation, etc. What I see now is a concerted effort to increase gate during less-traveled seasons - hence the free dining in August, extending of special events such as Food & Wine or MNSSHP, the 4+3 deal with the extra $200 during their 2Q (Jan-Mar), though some of that was to help that Q's revenue, of course. When the attendance troughs in certain time periods begin to shallow out, then you might hear talk about a new park. I suspect that they would do things like expand existing parks first (like a new land at AK, new attractions at other parks).

DVC might be outpacing DVC members' perception of park growth (i.e., they travel more frequently, therefore they're more likely to grow bored with current offerings). But they'd be much smarter to simply alter their marketing tactics towards DVC members (maybe that's why the make such a big deal about trading out to travel the world?) than to keep adding parks and attractions to keep up with a need that isn't based on bodies-through-the-gates.

 

[oakmanner]

Mos DVC Members are former day guests so it is really not an increase in over all guests at WDW. Once day guest become DVC Members they no longer are day guest therefore "less day guests".

Although I suspect most DVC'ers visit more often than they did as day guests.

I'd love a fifth gate, however in this economy and the $ Disney is spending at DCA a fifth gate is way out in the future!

 

[drusba]

DVC is a small percentage of annual WDW visitors (likely less than 4%). The annual park total visitors estimated figures previously plublished in Amusement Business, now published by Economic Research Associates, has not increased inordinately in the last 10 years, i.e, it has been both up and down (2002) and probably will go down a little this year over last, and any increases have reflected good economic conditions when they occur and Disney has added Coronado (1999) , AKL (2001) and Pop Century and there have also been numerous off-site hotels added since. Also, SSR replaced rental units, as has part of AKV and as will BLT, so they have not added many more rooms through DVC than existed before. DVC members do go elsewhere with trade-outs once in a while. My sense is that for DVC to start having any significant impact on crowds you will need to double the current number of WDW DVC resorts and by the time that happens, probably at least 15 years away, you would hope they will have added another park.

 

[tjkraz]

Disney learned an expensive lesson with the Animal Kingdom. They had hoped that a fourth gate would encourage guests to extend their trip durations and earn more money for the company. For the most part it didn't happen. Instead of spending 6-7 days at 3 parks they spent 6-7 days at 4 parks. It may have helped spread the crowds out a bit, but at the cost of hundreds-of-millions in construction and operating costs for the fourth gate.

I don't know that Disney will ever open a traditional 5th gate at WDW. Before the recent economic meltdown there were signs that Disney was considering some form of boutique park like Sea World's Discovery Cove. Under that business model there would be a relatively small number of guests serviced each day at very high prices (DC charges something like $300 per person, per day.) That could well prove to be an untapped market for Disney.

It costs a lot of money to build and maintain a stand-alone park. Staffing alone has to cover things like ticket sellers and takers, park security, parking lot attendants, street sweepers, management, gift shop staff, and so on. Disney has a lot of room to expand its current parks--particularly DAK and DHS--before they sink all of that money into another destination.

As for DVC, Disney hasn't really added as many room as you may think. The Disney Institute was closed to make way for SSR. Two floors of the Animal Kingdom Lodge were converted from cash rooms to DVC. The North Garden Wing at the Contemporary was demolished for the Bay Lake Tower. Yes there has been net growth, but some reductions as well.

Of the total guests visiting the theme parks on any given day, only a fraction are folks staying at Walt Disney World resorts. And of those only a smaller fraction are DVC members. In building new hotels, Disney's goal is to take business away from off-site resorts. When they sell DVC points, in many cases they are poaching sales away from Disney's own cash properties.

DVC will help grow the theme park business, but no time soon will it reach the point where a fifth park is mandated in order to handle the guest capacity.

 

[Donna M]

Since we have DVC we only go into the parks maybe twice during the week we are down there. We look at it as a resort to relax for a week. We go every year so we have 'been there, done that'.

There probably are some people in our slow boat.

 

[CarolAnnC]

If the parks become so busy that they are constantly crowded, Disney will be able to justify a 5th gate. DVC still makes up a relatively small percentage of overall WDW Park visitors, and to fill the parks take a great deal more people than DVC can provide, even if every DVC room were filled to capacity. Even if every on site room hotel room were filled to capacity, the parks would not be filled without off-site or local guests.

Chuck is right - look at early December, for example. It is extremely popular with DVC resorts booking up way before the 7 month window. Yet, the parks are uncrowded, and actually among the lowest park attendance days of the year.

 

[rutgers1]

On one hand, your points make sense and I hope you are right. On the other hand, I guess I just want to see another park opened, lol.

Actually, rather than open another park, I hope they make additions to Animal Kingdom and Hollywood Studios so that they can become a bigger part of my vacation.

 

[Brian Noble]

The chances of a fifth gate are about nil for a very long time. As Tim points out, the average stay is already hitting the typical domestic vacation of about a week, plus or minus, with more to do than you have time for. A fifth gate would just cannibalize what's already there.

Your second "hope", though, I think is already clearly on the path. Lots of good things have recently happened in AK (EE, LMA) and Studios (TSM, the probably-a-family-coster under construction at Soundstage 1) and there are juicy rumors for more.

For the health of the resort, AK needs to become a "three meal park", and Studios needs to finish its transition away from "working studio" to "hollywood that never was" well before any new gates are added.

As to DVC's impact: the resort averages over 128K people per day in the four theme parks. DVC only has several thousand rooms. Not to worry.

 

[rigsby25]

I too would like to see more additions to the parks that are already there. When you go often, it seems like you do the same things over and over and over again. Even though I like everything at the parks, I yearn for more.

 

[Dean]

I too doubt DVC has a dramatic effect but I realize it is additive. It seems DVC members don't go to the parks nearly as much as do non DVC guests over the same time period. There are many things Disney can do to spread people around without a new park, some are mentioned above, there are many more. However, while a new park doesn't make sense in one sense, the construction costs now would be much less than it would have been 3 years ago. To justify a new park you have to do at least one of two things. Either overfill the existing capacity or create a situation where you expect increasing crowds. DVC is a steadying influence to the system but is unlikely to create enough crowd issues to throw the system off other than on days that tend to get closed anyway and those situations are self limiting to a large degree.

 

[jennypenny]

Chuck is right - look at early December, for example. It is extremely popular with DVC resorts booking up way before the 7 month window. Yet, the parks are uncrowded, and actually among the lowest park attendance days of the year.

I think this is why you'll see resorts converted to DVC before you see a fifth gate. There is talk of closing Pop and re-theming it and adding family suites. I could easily see Disney converting the whole resort to DVC with an animation theme or something like that. It would be a nice compliment to the more upscale BLT. And it would reduce Disney's total number of value rooms which would drive CRO customers up to moderates at busy times.

DVCers have proven to be a reliable consumer base so I wouldn't be surprised to see DVC re-task some things to accomodate this. I think DVC membership would have to quadruple before it had any negative affect on park attendance. Honestly I don't think it ever would--DVCers attend at off times when Disney is looking for customers. I would think there is an inverse relationship between DVC attendance and CRO bookings (Christmas and Easter notwithstanding). That's what makes it so lucrative for Disney.

 

[Chuck S]

I wonder, if it weren't for the fact that Disney houses all the "groups" like cheerleaders, Pop Warner, etc. at All Stars, if Pop Century is actually the more popular Value resort with regular cash guests? I know we prefer Pop Century to the AllStars, and often drive to Pop Century to eat a light dinner at their food court.

I still think the existing POP could be left as in, and a DVC resort built in the abondoned area across the lake. The DVC resort building could even be nicely themed to he different decades of the early to mid 1900s, without using the giant icons, the existing food court /check-in building (assuming it is still in usable shape) could easily be modified to include a table service restaurant as well as the food court. and they could reduce the size of the check-in area to put in a resort store with a better selection of in-room food items for DVC. Just because POP Century is a Value resort, that doesn't preclude a DVC resort nearby. The existing unused guest room buildings could be finished and included in the current Pop Century, or rethemed into "Value Studios" for DVC, as they aren't really big enough for a queen and a full sleeper sofa...they could use two real full beds, or a full bed and sleeper sofa. There is room to add a somewhat cramped kitchenette. After all, we've already seen some smaller "Value" rooms at AKV Jambo.

 

[murcor]

Since we have DVC we only go into the parks maybe twice during the week we are down there. We look at it as a resort to relax for a week. We go every year so we have 'been there, done that'.

There probably are some people in our slow boat.

Right there with ya!!

We go for 2 weeks and do maybe 2 or 3 parks (that includes the water parks etc)

The following year we do two different parks. By the 4th year we start the rotation again

A 10 day no expiry tkt will last us 3 -4 years

Even though we only do a few parks we always seem busy, not sure doing what

 

[BEASLYBOO]

Since we have DVC we only go into the parks maybe twice during the week we are down there. We look at it as a resort to relax for a week.

Love Disney, Love DVC! but DVC has taken the commando pace out of our vacation. We enjoy the resorts, the parks and all that they offer but we've also started to explore what else Orlando has to offer in the way of attractions and fine dining. By the same token, when the parks are too crowded, we head back to the resort. This June we're staying 6 days, we'll do Epcot, Typhoon Lagoon and Islands of Adventure. The rest of the time we will relax, enjoy the resort and dine out at a few of our favorite Orlando restaurants.

 

[ADP]

Considering the wait times at attractions I'd say that'a big 10 - 4!

We've grown accustom as guests to accept wait times beyond 60 minutes. To me...Seeing those kind of wait times means we are out-pacing the parks even in tough economic conditions.

 

[JimMIA]

I don't think DVC has anything to do with it, because DVC is WAY too small a slice of the WDW pie to have much effect. However, I do believe the growth of visitation generally has outpaced the capacity of the parks.

And none of the second-tier venues have worked. I think, at one time, they envisioned DTD as almost a 5th gate, but the attractions there didn't work any better than the attractions at the Boardwalk. Hence, closing DisneyQuest and Pleasure Island and turning the whole place into a massive Disney Store. The water parks haven't exactly taken off, and what else is there...miniature golf?

We usually go in relatively slow periods (May and early November), and we still find the parks overcrowded to the point of not being enjoyable some days. It's much worse during busy periods.

The real beneficiaries of this trend are the Sea Worlds/Universals, et al of the world. They get more overflow; WDW just gets more uncomfortable. But as others have said, major increases in capacity come with a very high pricetag.

 

[Brian Noble]

I do believe the growth of visitation generally has outpaced the capacity of the parks.

Unfortuantely, the data don't back that assertion.

The Magic Kingdom's busiest year? 1991. Same with Epcot. Studios' busiest year? 1997. AK's peak years are current---with the opening of Everest.

What's notable about 1991 and 1997: those were around the time Studios and AK opened, respectively.

MK's annual attendance has recovered close to its peak---but I suspect some of that has to do with the hard-ticket Parties, which effectively give MK an extra Operating Day each time one is held, as that attendance is counted separately.

 

[tjkraz]

Considering the wait times at attractions I'd say that'a big 10 - 4!

We've grown accustom as guests to accept wait times beyond 60 minutes. To me...Seeing those kind of wait times means we are out-pacing the parks even in tough economic conditions.

Don't know when you are visiting but I have never waited 60 minutes for any attraction at WDW. Waited about 25 minutes for Astro Orbiter once, but that's about my upper limit. Although Fantasmic may have been a 45-60 minute wait one time if you want to call that an "attraction."

But speaking to wait times in general, the biggest problem there is that Disney doesn't run its attractions at full capacity during slower periods. They will run the coasters one or two trains short of what they can really handle. They'll operate only one load platform at PotC, Space Mountain and Great Movie Ride. Star Tours will run only a fraction of the simulators available.

Some of the time those are sensible decisions. It doesn't make sense to staff PotC for a 5 minute wait time when 10-15 is still reasonable. Other times...well, draw your own conclusions.

But the point is Disney can absorb a lot more capacity with its current parks and attractions simply by increasing staffing. As crowds grow, that's the first approach to take long before a fifth theme park becomes a reality.