It's gut-check time for Orlando theme parks
The weeks between Thanksgiving and New Year's traditionally are among the slowest, if not the slowest, of the year for Central Florida's theme parks.
At the turnstiles, that is. In the planning and promotions departments, though, this is hardly a down time. The holiday season is when families start thinking about their summer vacations. (Heck, that's why we're running a series on theme park vacation planning.) Theme parks are taking a hard look at their advance bookings and ticket sales and making decisions about advertising, promotions and pricing.
According to Jim Hill, the outlook at Walt Disney World may be grim. Hill reports that just 35 percent of the resort's hotel room nights have been booked for January.
Theme park managers, from Disney, Universal and Busch, aren't taking the news lightly, it appears. Reps from all three have been talking to local officials, trying to squeeze some more money from regional marketing funds to pay for additional advertising.
It's gut-check time, not just for Orlando-area theme parks, but for businesses throughout the industry and the country as a whole. Massive changes are coming in the U.S. economy, as the government ponders new bailouts and markets shift. The companies that can hold on to and win new customers now will be the ones that dominate their industries for a generation. Those that cut back and lose market share might not even survive this downturn.
Are you in, or out? That's the question that theme parks will answer with their actions in the next few months.
Update: [Junk] rolls downhill: U.S. 192 hotels suffering, too. Just 30 percent of rooms were occupied in September. Thirty-buck rooms abound, but still go empty.
In... our trip in June to WDW is booked and paid for. Still keeping an eye out for decent airline ticket prices (YEAH RIGHT!) and haven't bought tickets to Universal Studios yet. I'm wondering what attendance will be like as well.
Gut check time for me and my family means no major theme park trips next year whatsoever. The only amusement park I will visit is Worlds of Fun which is exactly 15 minutes from my house. And the only time I will visit is in May when the company I work for (if I still have a job in May) funds a company picnic to WOF.
Not if you continue to talk about the others. ;-)
Wow this is getting serious...but i think they have to realize that january is a down time for them and with the economy there will be less people. now when it gets to summer and if it is still under 50 is when they need to worry
Jim is leaving out some critical information in his piece. While reservations are only at 35 percent, he fails to mention what the normal reservation rate is. How much of a drop off are we dealing with here? 20 percent? 50 percent?
Orlando parks....Disney included, would be the wiser to prepare for a down year. The economic crunch has gotten to people's retirement, but it will soon start hitting more people's wallets. When credit card companies start clamping down hard on their cardholders, than the people who continuously rely on them will find themselves in a pinch as well. Black Friday sales may have been ok, but A) It's one day out of the shopping season, and B) I think that many are still living like nothing is going to happen. People talk about bailouts, but I highly question how effective they will be...given the fact that we seem to be simply throwing money at the same people who got us into this mess.
I think the key metric for this year and next will be market share. Forget about revenue and operating income. They're gonna stink. But you must hold on to your market share, even as the market as a whole contracts. And ideally, you will increase your market share, positioning yourself for big profits when the market does expand.
And let's also remember... market share
Believe it or not we are actually in the middle of trying to decide if we should just book a trip for around February at WDW or go ahead and buy into their vacation club. We may be one of the few that is actually thinking of doing this. DVC has offered us some nice deals on the new Contemporary Vacation Club resort but then again, we are looking at the buy 4 get 3 free. It is a tough choice but one we are probably going to have made by the end of this week. We really want to take one more trip during the least crowded months before our son goes to kindergarten in August. We also are planning another trip to the Smokey Mountains for next year and will probably hit up Dollywood.
That's a tough call. I wonder if Disney will be offering DVC deals soon, too.
While Robert is correct that (at least on paper) the success of one park canabalizes another, when national and international travelers come to Orlando to see a new "gate-crasher" attraction (i.e. Universal's Potter) they will tend to go down the road and spend at least some time at another park (be it Disney or Sea World).
It will be interesting to see if Sea World and Universal have better years simply because of their new coasters. At the very least, locals would be more apt to go to those parks. I wonder if Disney is making a mistake with all of their cutbacks and by not having any major attractions opening next year.
I agree with TH that Harry Potter will grow the theme park market. But there is a lot of time between now and then for grave damage to parks' bottom lines.
I guess if we had anything worth seeing around our parts, we might consider a "staycation" too, but we don't so we choose to travel abroad. As long as we can afford it, we will continue to do so. I think that's what it comes down to for most folks who choose to go and for those who can't.
Hey here's another cosideration.
What are local travelers? If you're an Orlando local, why would the attractions want you to travel?
I find it funny that Disney's volume is down for hotel bookings. I have checked several other home rentals sites taht I keep bookmarked and they are tracking at around 75% booking through February. Seems the home owners are catching on to the ecomony trends sooner and faster than Disney lowering their prices and offering very competitive deals. We have always gone down that route. You get a lot more for your money that way. Looks like the economy is waking a few other people up to that fact as well.
I suppose it is cheaper to stay off site, but we just like being on site for our entire vacation(s).
Agreed on focusing more on the immediate region. The passholders and those within a few hours will become valuable commodities in the next couple of seasons. As for market share, the parks with the new attractions will succeed the most. Universal stands to gain market share with the Harry Potter attractions. A new Busch Gardens coaster will also help in that area. Unless this whole mess goes on (and it just might) for a long time, I don't think that the Orlando market will be a survival of the fittest kind of thing, at least for the big guys in the area, because they are all quality parks.
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