So just why is Disney raising ticket prices so early

[KSDisneyDad]

Ok Ok, we get it disney has to make a profit.There is no one here that doesn't know that.However the main discussion I think is going on here is how they have been doing it and how if may affect disney in the future. If they keep up the current increases compared to the rest of the world it will without a doubt become an exclusive club that will price out many many people.I guess the real question is do we want disney to become more exclusive or run more like a superstore that handles more people and still makes a nice profit.I prefer the latter as I have seen this working in the 80's and 90's and early 2000.I don't like the way things have turned with the new management.I particularly don't like when a higher up says discounts are gonna dry up,seems to me he has pointed to the direction they are headed in.In my opinion the darkside may be winning this one!

Is your space bar broken?

I think there is a middle ground. It's not a clear cut black and white issue. It doesn't have to be either a superstore for the masses or an exclusive club. I think Disney does a good job of trying to accomodate those on a budget who can go during free dining and stay at a value resort or someone who goes at Christmas at a Concierge level MK view room at the GF with a VIP tour guide each day.

I don't want it to become the wal-mart of themeparks. That's why we go Disney. I don't like our local "theme" park. It's not an escape or a resort destination, whereas that is how we view Disney. But just because I don't want that, doesn't mean I think it should be an exclusive club either. There are many many businesses that thrive in the middle and I think Disney is one of those.

I remember one year, we were blessed enough to make a decision to visit Disney in about a month after we made our decision. We booked airline tickets and stayed at the AS Sports for 5 nights. It was an early May trip in 2001. While on the bus, I saw a family and the Dad was wearing a t-shirt with our hometown baseball team's logo. I struck up a conversation with them and found out they had been saving up for 3 years, they drove down to WDW and were staying four days so there 2 boys could see all four parks. It was their trip of a lifetime. I never take trips for granted, but Disney is open to anyone who has a little discretionery income and makes a decision to spend that money on a trip to Disney vs something else. It may only be one trip or it could be a trip two or three times a year.

I don't think we need to make this discussion about class warfare just because of an annual ticket price increase. There are many things that increase in price faster than the average CPI. To me, you just have to ask yourself -- does the perceived value exceed my cost? If no, stop going.

 

[DebbieB]

HGTV pays for it. HGTV is owned by Disney.

HGTV is not owned by Disney. It's owned by Scripps Networks.

http://scrippsnetworks.com/

http://newsroom.scrippsnetworks.com/article_display.cfm?article_id=4872

 

[DebbieB]

$300 for an annual pass? Where can one get one that cheap? Is it for Florida residents only? I thought even those were more expensive than $300.

A $300 annual pass would probably draw a lot more visitors and make it extremely popular. Right now, the gate price for a 3-day park hopper is more than $300. Sounds like that great deal on an annual pass wouldn't apply to most WDW visitors or this whole conversation would be moot.

A Florida Resident Seasonal Pass is now $286. A full annual pass for FL residents is $414.

 

[flicx]

I don't think we need to make this discussion about class warfare just because of an annual ticket price increase. There are many things that increase in price faster than the average CPI. To me, you just have to ask yourself -- does the perceived value exceed my cost? If no, stop going.

Not really making it a class warfare issue,just stating the current trend at disney.A hundered dollars a day isn't that far away.They are still,and have been for years now, jacking up prices at a multiple that far exceeds an average families rate of income increase.It is just a fact that if this continues you will price a certain portion of the population at some point!Most people go to disney primarily to go to parks.If you make the cost of that too high people won't come,period end of story.Everything revolves around the parks,food, hotels and the extras of downtown disney etc.Now when you make that cost(park ticket ) cost a couple grand for a family of four you start to eliminate alot of people in the mid to lower income bracket. The tickets are the most essential item to attracting customers in my opinion.

 

[TDC Nala]

From a Corporation perspective, I think it is to push people towards DVC and annual passes

The cost of annual passes is going up too.

Now that the ticket prices have been raised, if people stop coming, they probably won't lower the ticket price - just offer more room discounts, more "events" designed to get people into the parks, etc, and then not raise the prices again for awhile. I would imagine that no matter what the economy brings, I bet Disney knows how high they can raise the ticket price before enough people will stop coming to make a difference. It's expensive now and at busy times they can still get plenty of people into the parks.

 

[Planogirl]

Clearly, I'm the only one who found it funny that -- in a topic littered with people saying that Universal was becoming their park of choice because Disney was too expensive -- it turns out that Universal is actually the more expensive park, when measured this way.

But I did find it funny. And not just giggle worthy, but big ol' laugh funny. Sue me.

I do think Disney knows what they're doing. They're not tossing darts at targets and choosing pricing strategies at random. Why do you think they have those survey-takers in the parks? Why do they enlist people to be part of their on-line research? Why do they e-mail surveys to people after they get home? Why do they do focus groups or call you when you've complained about something? They want feedback. They need Guest reactions and information to know if they're doing things right.

Every decision they make is based on Guest response. What people here forget is that the DIS is a very very small sample. Even if every single person on the DIS totally agreed about something eek and then every single person on the DIS wrote to Disney to express that singular opinion, it would be a very small blip. It would be noticed, and Disney would wonder why a few thousand people suddenly all wrote to them about food quality at Le Cellier or whatever, but the entire DIS is still less than one percent (and probably less than one half of one percent) of total Disney guests in a year. Everyone on the DIS may decide that Disney is no longer a value and they may all stop going. But again -- unless everyone on the DIS has been going to Disney at exactly the same time every year for a couple years (at least) running, the change wouldn't be noticed. Those 5000 fewer trips will be spread out over a year, or a couple of years, and be written off as normal attrition.

I think Disney is very clear on where to stop and how much they can add, subtract, change or not to keep "on track" financially. I think they know exactly where the line is.

That is true for the one day purchased at the gates. I suppose that they might think that those who only come for one day and don't know to purchase online will pay the extra for just that one day. I don't see the humor but we all have different things that amuse us of course.

I agree that the sample here is small. I don't see that the masses who don't post here might not as some point think "too expensive" or "the food stinks" too though. We have no way of knowing that of course.

 

[rt2dz]

HGTV is not owned by Disney. It's owned by Scripps Networks.

http://scrippsnetworks.com/

http://newsroom.scrippsnetworks.com/article_display.cfm?article_id=4872

I stand corrected. Just a marketing/joint venture contract. But, relatively the concept is still the same. Disney is making money of HGTV (and vice versa).

 

[WDSearcher]

Ok Ok, we get it disney has to make a profit.There is no one here that doesn't know that.However the main discussion I think is going on here is how they have been doing it and how if may affect disney in the future. If they keep up the current increases compared to the rest of the world it will without a doubt become an exclusive club that will price out many many people.I guess the real question is do we want disney to become more exclusive or run more like a superstore that handles more people and still makes a nice profit.I prefer the latter as I have seen this working in the 80's and 90's and early 2000.I don't like the way things have turned with the new management.I particularly don't like when a higher up says discounts are gonna dry up,seems to me he has pointed to the direction they are headed in.In my opinion the darkside may be winning this one!

But don't you think that if the price increases were so off base and so irrational and so unfair that no one else would dare approach them? I mean, wouldn't Universal's strategy, then, be to back off and prove that Disney is indeed being unrealistic with the price of admission? And yet Universal never says, "We're not raising our prices this year because it's just not right." Clearly the upper theme park execs in both companies are getting advice from somewhere that the prices are still workable for enough people to make any hit they take ultimately worth it in the end.

Disney has always -- to some extent -- been an exclusive club that prices out many many people. Six Flags and SeaWorld and Dollywood count on that. Even when park tickets were $17, my family had to save for four years to afford a trip. And even then we stayed in Days Inns and ate breakfast in our room and dinner at Golden Corral or some other cafeteria style place. My mom's dream was to stay at the Poly for even just one night and we never could. Every year when we returned, people would say to my dad, "Wow -- you must be rolling in dough to afford to go to Disney." Even then, it was considered a more "elite" vacation.

I for one hope that Disney is NEVER "run like a superstore", stuffing in more people for less money per, just so that they can "still make a nice profit".

 

[KSDisneyDad]

Not really making it a class warfare issue,just stating the current trend at disney.A hundered dollars a day isn't that far away.They are still,and have been for years now, jacking up prices at a multiple that far exceeds an average families rate of income increase.It is just a fact that if this continues you will price a certain portion of the population at some point!Most people go to disney primarily to go to parks.If you make the cost of that too high people won't come,period end of story.Everything revolves around the parks,food, hotels and the extras of downtown disney etc.Now when you make that cost(park ticket ) cost a couple grand for a family of four you start to eliminate alot of people in the mid to lower income bracket. The tickets are the most essential item to attracting customers in my opinion.

I disagree that tickets are the most essential item. But even if I do acquiesce to that logic, I don't think Disney has priced themselves out of the market for those guests who plan "big" vacations.

We look at WDW compared to other vacation destinations. If you go on a cruise, it's generally going to be at least $100 per person per day. WDW has an offer for $94 per person per day. Even if you go to someplace cheesy like Branson, MO, it will cost $35 to $50 per day for theme park tickets and then another $15 to 20 to go to a "show" or do some other local attraction. Disney tickets are $40 per day for 7 day tickets. If I spent a week locally visiting different attractions, we could easily spend $40 per day per person. That's just one of the many reasons we find "value" in our trips. Others don't feel that way and that's okay. I remember one year, we spent 5 days at WDW and then went to Destin, Florida for 3 days. We spent more per day at Destin, FL than at WDW when you factored in hotel, food and activities.

For those who don't (or can't) take these types of vacations, I would argue that a certain percent of the population has been priced out of Disney years ago. I have many family members that can't afford to travel there even if it was just once every 10 years.

And tickets for a family of 4 already exceed 2 grand if you want a fully loaded 10-day MYW ticket with park hopping, water parks and no expiration. But Disney gives you the option to carve out what you don't want so most tickets are a lot less. I believe this is why Disney continues to draw a diverse group of guests.

I just don't believe that you can easily extropolate what's done today into the future. Although Disney has increased prices over the past several years on its tickets, for many Disney guests, the overall price to going to Disney has actually gone down if they were able to take advantage of the multitude of deep discounts and free dining promotions. It seems that Disney rarely offers deep discounts on park tickets, but will discount every thing else. The only deep discounts on park tickets I've seen are the kids play free promotions. Even the 4/3 promotions aren't that great for the park ticket component as the extra 3 days is nominal compared to the first 4 days. Disney will price accordingly to draw as many diverse guests as possible and it probably won't just be a blind x% increase every year. I do not believe that Disney will price overall vacation packages to a point that most of their current guests can't go. Sure, some will be priced out of the market, but Disney simply cannot allow that to happen for a majority of their guests or they will begin losing income. If bookings are down and spending per guest numbers decrease, we will see more promotions - maybe not on tickets, but on other things. The deep discounts of the past won't continue forever, just like the new trend of fewer discounts won't continue forever. There will always be peaks and valleys. Each family just has to decide if that extra price is worth it during the "peaks". Maybe it's a shorter trip or a trip every other year instead of once a year. But on a macro level, overall Disney guest numbers will rise during these peaks as more guests experience WDW.

Disney's had several years of "down" years as evidenced by the multitude of free dining promotions, ceased building of the Animation Resort, etc. Perhaps the removing of discounts and rising prices are a good sign in that it means that Disney will be more profitable and will add even more things to make the parks and resorts even better. I know it's a bit optimistic, but they can't be too short-sighted.

 

[GadgetRick]

I do think Disney knows what they're doing. They're not tossing darts at targets and choosing pricing strategies at random. Why do you think they have those survey-takers in the parks? Why do they enlist people to be part of their on-line research? Why do they e-mail surveys to people after they get home? Why do they do focus groups or call you when you've complained about something? They want feedback. They need Guest reactions and information to know if they're doing things right.

I don't think anyone is saying they don't know what they're doing. It's obvious they know exactly what they're doing or they'd have failed long ago. Doesn't mean I have to like what they're doing though.

Every decision they make is based on Guest response. What people here forget is that the DIS is a very very small sample. Even if every single person on the DIS totally agreed about something eek and then every single person on the DIS wrote to Disney to express that singular opinion, it would be a very small blip. It would be noticed, and Disney would wonder why a few thousand people suddenly all wrote to them about food quality at Le Cellier or whatever, but the entire DIS is still less than one percent (and probably less than one half of one percent) of total Disney guests in a year. Everyone on the DIS may decide that Disney is no longer a value and they may all stop going. But again -- unless everyone on the DIS has been going to Disney at exactly the same time every year for a couple years (at least) running, the change wouldn't be noticed. Those 5000 fewer trips will be spread out over a year, or a couple of years, and be written off as normal attrition.

Well, you're sort of right on this, they're looking at customer response but, honestly, the response they're looking at is how much money people are spending. If everyone goes and tells them they suck and they're not going any more because of costs, etc. but they turn around and keep coming back. They don't really care about it. Obviously, they don't like bad PR and that's an extreme situation which isn't going to happen but, in reality, they care about how much money they're making. If they're making it and the customers aren't happy, they aren't going to change.

 

[TLSnell1981]

I think is going on here is how they have been doing it and how if may affect disney in the future. If they keep up the current increases compared to the rest of the world it will without a doubt become an exclusive club that will price out many many people.I guess the real question is do we want disney to become more exclusive or run more like a superstore that handles more people and still makes a nice profit.

I think, Disney is perfecting, a combination of the two... An expensive, exclusive club..but with superstore quality.

 

[jayandstacey]

I think the discussion regarding Disney wanting to increase prices to control crowds is laughable. If you think Disney sits around and talks about how to lower the attendance level you're crazy. They want MORE people, not less.

Think about it, if people aren't saying no to Disney over increased prices, why on Earth would they be saying no because it's crowded? As I've said Disney is ALWAYS crowded (more during certain times than others). Everyone knows this before they come (regardless of whether they're informed like many of us around here or not).

Heck, take it a step farther, during certain times (Christmas and other holidays) MK fills to capacity and they have to stop allowing people to come in! We all know it's busy during Christmas but you have to book 2 years in advance to get in!!!

So Disney knows darn well the bulk of people do NOT stay away because of the crowds. Yes, there are some but they probably wouldn't go anyway.

And, most importantly, the more people who go, the more people who spend money on other things (souvenirs, food, etc.). And Disney counts on that additional revenue. I don't know the numbers but I have a feeling the profit margins on these other things is higher than tickets. Why would they try and stop having people come and spend money on the higher-profit items???

The whole idea of Disney working to lower the crowd level is a joke.

I'm the one bringing it up - and notice I'm only talking about the parks. I do believe that Disney very much does price the parks, in part, to keep the crowds somewhat down - so they can do other things on property.

Think of it this way...let's say the price to go into a park was built into your on-site hotel room night's stay (forgetting about the feasibility of this...just for argument's sake...) - if that were the case, then why would anyone ever go to DTD? or to any other options that bring in some cash for Disney but are not in the parks? I do believe that Disney wants you on property but does not want you in the park every day of every trip - and this is accomplished through pricing.

They DO, however, want the most people possible on their massive property, spending money.

I can't prove it, and maybe it is a joke. But I think it is at least possible.

 

[jayandstacey]

It's your estimated 20% more attractions in the original park, plea three additional major theme parks, plus two water parks, plus DisneyQues, plus two miniature golf courses, plus several regulation golf courses, plus recreational bot rentals, plus water sports, pus spas, plus shopping, plus dining...and yes, I'm aware much of that costs extra.

My point - and I really detest having to remind everyone - Disney is a business. The company's ultimate goal is to earn a profit for its owners, the shareholders. Some of 'em are right here on the DIS .

Yes, aware of all that. But as you point out, if you buy a one-day, one-park ticket - you get none of that extra stuff. So back in 1982 a trip to MK cost about $30, now it costs about $90. All those other things help add to the reasoning behind that cost increase ("cuz tomorrow you can go to a waterpark") but both back then and today - the admission ticket doesn't actually buy those things.

Disney's clearly done a fabulous job of this "synergy' stuff.

We're agreed (as most are) on Disney's goal - what we seem to disagree on is just how ruthless Disney is on getting to that goal.

 

[jayandstacey]

Clearly, I'm the only one who found it funny that -- in a topic littered with people saying that Universal was becoming their park of choice because Disney was too expensive -- it turns out that Universal is actually the more expensive park, when measured this way.

But I did find it funny. And not just giggle worthy, but big ol' laugh funny. Sue me.

I do think Disney knows what they're doing. They're not tossing darts at targets and choosing pricing strategies at random. Why do you think they have those survey-takers in the parks? Why do they enlist people to be part of their on-line research? Why do they e-mail surveys to people after they get home? Why do they do focus groups or call you when you've complained about something? They want feedback. They need Guest reactions and information to know if they're doing things right.

Every decision they make is based on Guest response. What people here forget is that the DIS is a very very small sample. Even if every single person on the DIS totally agreed about something eek and then every single person on the DIS wrote to Disney to express that singular opinion, it would be a very small blip. It would be noticed, and Disney would wonder why a few thousand people suddenly all wrote to them about food quality at Le Cellier or whatever, but the entire DIS is still less than one percent (and probably less than one half of one percent) of total Disney guests in a year. Everyone on the DIS may decide that Disney is no longer a value and they may all stop going. But again -- unless everyone on the DIS has been going to Disney at exactly the same time every year for a couple years (at least) running, the change wouldn't be noticed. Those 5000 fewer trips will be spread out over a year, or a couple of years, and be written off as normal attrition.

I think Disney is very clear on where to stop and how much they can add, subtract, change or not to keep "on track" financially. I think they know exactly where the line is.

Concur.

 

[KSDisneyDad]

I think, Disney is perfecting, a combination of the two... An expensive, exclusive club..but with superstore quality.

I have to wholeheartedly disagree with this extreme exaggeration.

To me, when you say that Disney has a superstore quality, it is inferior to other theme parks. Compared to any other so-called theme park I've visited, Disney remains far superior in quality.

And it's not an expensive, exclusive club. Yes, it's expensive, but nearly all major vacation destinations are expensive whether it's Vegas, New York, DC, Hawaii, Europe, Ski Vacations, cruising, etc. Disney's not even the most expensive of these.

 

[KSDisneyDad]

A Florida Resident Seasonal Pass is now $286. A full annual pass for FL residents is $414.

What a great deal! Wish we could take advantage of that low price.

 

[jayandstacey]

Disney changed $4.95 on opening day. According to my handy dandy CPI calculator, that's worth $27.62 in today's money. Today's ticket is $90.53, over three times the inflation-adjusted initial admission.

And while you might say "but there are 4 parks now..." I'm comparing to a one-person, one-day, one-park ticket that expires. For your $90.53, you aren't allowed in the other parks.

I suspect the original tickets, once purchased, didn't expire - thus a better comparison may be $27.62 to $102.77 - but you HAVE to buy a two-day pass at $205.55

Back in 1971, many rides required an additional ticket ("e" tickets, for instance)...OK, this stopped by 1982, when a one day ticket was $14.00 (in 1982 dollars)...which would have the buying power of $32.78 in today's dollars.

SOOOO...somewhere after 1982, the rate of Disney park admission prices has increased at a rate just of about triple the CPI. And remember, CPI is an index of common household items, measured and reset every year, thus reflecting buying power of actual items, not of interest or exchange rates.

To quote myself...I thought "is this a valid comparison?"

While I still think it is, there is a hole in this. Basically, the CPI is much more commoditized than a Disney vacation. Gallons of milk, gas, housing prices, even movie tickets - these all have a certain "no name blandness" to them that makes them commodities of a sort.

Put another way, they all have significant pricing pressure. Gas prices are posted right on the sign - if a gallon of milk gets too expensive, you go to another store, etc.

Disney has, since day one, built an economic 'moat' around their brand and their offering in Florida that makes it everything but a commodity. And thus it represents more accurately what happens when a popular offering continues to add features without much competition - the prices can continue upward virtually unabated until demand is impacted.

So while this isn't a perfect comparison, but it still remains a fact that Disney prices have risen significantly faster and farther than the CPI from about 1982 on.

 

[WDSearcher]

I don't think anyone is saying they don't know what they're doing. It's obvious they know exactly what they're doing or they'd have failed long ago. Doesn't mean I have to like what they're doing though.

True enough.

Well, you're sort of right on this, they're looking at customer response but, honestly, the response they're looking at is how much money people are spending. If everyone goes and tells them they suck and they're not going any more because of costs, etc. but they turn around and keep coming back. They don't really care about it. Obviously, they don't like bad PR and that's an extreme situation which isn't going to happen but, in reality, they care about how much money they're making. If they're making it and the customers aren't happy, they aren't going to change.

Well, you're sort of right on this.

Disney cares about how much money they're making, but they understand that the amount someone spends is directly related to that person's satisfaction with their visit. If it was just about dollars, Disney could (and would) do a lot less and still be several notches above the competition. They understand that with higher satisfaction comes higher spending. And they are always looking for that point on the graph that represents the exact right amount of spending in to get the best return out.

 

[jayandstacey]

Disney cares about how much money they're making, but they understand that the amount someone spends is directly related to that person's satisfaction with their visit. If it was just about dollars, Disney could (and would) do a lot less and still be several notches above the competition. They understand that with higher satisfaction comes higher spending. And they are always looking for that point on the graph that represents the exact right amount of spending in to get the best return out.

Yeah - with you on that.

In some ways, I'm surprised Disney doesn't go after some REALLY high-end dollars, even just in small amounts. I'm pretty sure they know that they few extra dollars might not be worth the damaging "not for the average family" image. For instance:
1. Cabanas at the Odyssey restaurant, or elsewhere in Epcot. Charge $500 a day for an A/C'd room with a couch, TV, fridge and concierge service.
2. The Cinderella suite in the castle, for (say) $5000 per night.
3. Private plane/blimp/helicopter viewings of illuminations or wishes for (say) $2500.
4. Private transportation around the property, like an on-demand Disney limo service for (say) $200 per day for direct hotel<->attraction trips.

etc.

Yet, while they may not be doing those things, Disney does come close on some of these, no??

Anyway, the point is that I suppose Disney has some sense that it has to appeal to the masses, not just the whales.

 

[TLSnell1981]

I have to wholeheartedly disagree with this extreme exaggeration.

To me, when you say that Disney has a superstore quality, it is inferior to other theme parks. Compared to any other so-called theme park I've visited, Disney remains far superior in quality.

And it's not an expensive, exclusive club. Yes, it's expensive, but nearly all major vacation destinations are expensive whether it's Vegas, New York, DC, Hawaii, Europe, Ski Vacations, cruising, etc. Disney's not even the most expensive of these.

But, merchandise and dining have become generic..quality has also suffered. Disney is not the unique theme park of yesteryear, and it's sliding into the amusement park category.. We have vacationed at Disney for over 30 years. Changes have come hard and fast this past decade, especially in the last few years. IMO