Why do theme parks keep raising their ticket prices?
Recent news of price increases at Walt Disney World, Universal Orlando and the Disneyland Resort have elicited quite a bot of anger and anguish from readers, many of whom feel that they won't be able to afford the theme park vacations they've enjoyed in the past.
That passion speaks well for the quality of experience that these theme parks provide, actually. The parks have created something that many fans don't want to lose. But these price increases send another message, too - that the nation's top theme parks aren't necessarily middle class destinations any longer.
When I was a kid, wealthy families wouldn't have been caught dead slumming it on vacation at a place like Walt Disney World. Disney was strictly a middle-class destination, the choice of families that could never afford a week at Hilton Head or some other rich person's golf-and-beach resort. The upper-middle-class families who came to Disney might stay on-property, in one of the few hundred rooms available at the Contemporary and Polynesian Resorts. But for the rest of us, thousands of rooms in low-cost motels on 192 awaited. With two-day passports less than $20 in the 1970s, a family of four could spend a couple days at the Magic Kingdom - including counter-service food - for under $100. Pair that with a drive over to the free beaches on either coast, and Florida offered an affordable vacation get-away to millions of middle-class families.
But over the past 30 years, the American economy changed. Real wages (in other words, hourly wages adjusted for inflation) haven't budged since the early 1970s, despite massive gains in worker productivity. Real wages went up a bit in the late 1990s, but Americans gave those gains back in the 2000s. The American middle class has shrunk, and the gap between wealthy and working class Americans has grown to the widest level since just before the Great Depression.
The people running Disney and Universal aren't stupid. They've reacted by gradually shifting their business to go where the money is. Walt Disney World has transitioned from a middle-class destination to one for upper-middle class and wealthy vacationers. When the dollar weakens, the Orlando parks market aggressively to tourists from outside the United States. Each of the top 10 most attended parks in the United States have added ticket options and resort amenities designed to appeal to wealthy visitors, adding price points that the crowds who came to the parks in the 1970s would never have supported.
Today, if you have the money, you can choose from thousands of hotel rooms in four-star hotels on Disney and Universal property. You can spend hundreds of dollars (per person!) to have tea with a princess. You can dine in award-winning cuisine in world-class, table-service restaurants. And, for the price of staying in the correct, on-property, hotels, you can even have exclusive ride time on selected attractions, or skip the lines entirely. Appropriately, parks are adding and improving attractions in return for all this extra income, too. Today, park visitors can enjoy wonders such as The Wizarding World of Harry Potter, and soon will have an expanded Fantasyland in Orlando and a new Cars Land in Anaheim.
Now, middle class families still can - and do! - afford Orlando theme park vacations. It's just that, today, staying off-site on 192, visiting the parks during "normal" operating hours, waiting in lines, and eating only counter-service meals gives a family of vacationers the low end of what the Orlando theme parks have to offer, instead of the typical experience enjoyed by the vast majority of visitors.
Even as the parks raise their "rack rates" for admission and hotel rooms, they continue to offer discounts that sharp consumers can exploit. But to get the most value from an Orlando theme park vacation, families can't just pile in the car and hit the road for Central Florida, as they once could do. Today, middle class families that want more than a bare-bones Disney or Universal theme park vacation are going online, doing research, and getting engaged with fan communities. They're not just tracking discount opportunities, they're learning tips and lessons on how to navigate the increasingly complex offerings at the parks, to get the most value for what they're paying.
While that's great for site such as Theme Park Insider :^) - that's tough for time-pressed middle-class parents who are working harder than ever for the same wages their parents earned in the 1970s.
So what happens to middle-class theme park fans who can't afford Orlando any longer? Many of them have been discovering high-quality, but more affordable, regional parks closer to home. One of my goals on Theme Park Insider is to bring to your attention world-class offerings at these regional parks, such as themed lands of Busch Gardens Williamsburg, the Broadway-quality entertainment at Dollywood, and the free amenities and top-notch wooden roller coasters at Holiday World.
Why do theme parks raise their ticket prices? Because they can. Demand drives ticket prices in the theme park business. So long as people keep buying tickets and booking theme park vacations, parks will continue to raise prices as they seek the "optimum market price" - the price point just before they start losing so much business that it reduced their overall income. With wealthy Americans earning more than ever, the nation's high-end theme parks have decided to go after that market. And so far, they're getting it.
Want to know why Disney and Universal are raising their prices? There you go. The smart thing for you to do - as a consumer and a theme park fan - is to set your emotion aside and to make a smart, well-informed decision about where you'll spend your vacation dollars. (And that's true no matter what your income level.) Research discount opportunities in Orlando. Learn how to get the most from your vacation dollars at the parks. Improve your money management skills. And look into world-class alternatives at competing regional parks.
Enjoy yourself while on vacation, but treat your vacation planning like it's business. Get informed. Look at the alternatives. And find the option that delivers you the maximum enjoyment without breaking your family's budget. For theme parks, ticket prices are a calculated business decision. Your decision whether or not to pay those prices should be just as well calculated.
If you based your vacation on the 1970s example, it would still apply to today especially if this is regarded as middle class. When I was a kid, we had vacations similar to your example. My mother was a single parent and she took us on vacations to Disneyland and Sea World in San Diego and we stayed at local motels and such. You can still do a cheap vacation.
Great article. Part of the reason we moved to Orlando is how it reduced the cost of going to the parks.
The middle of this almost seemed to be a rallying cry for #OccupyMainStreetUSA.
Spot on. I'm planning our family's third trip to Orlando in 15 years, and wondering how in the world we did it before! Still planning to use the same percentage of our budget for vacation expenses, but this time we'll be on I-Drive instead of on-site.
Great, timely article, Robert. Really appreciate the breakdown and focus on getting the biggest bang for your hard earned savings - even if that means skipping Disney/Universal completely!
One of the best ways to save towards a Disney vacation is the new Disney Rewards Visa card. They give you double points for supermarket, restaurant, gas & Disney purchases. If you're a family that only goes to Disney once every three or four years, you can easily amass a large number of points, and then use those points to pay for Disney tickets, Disney hotels, Disney restaurants etc. Use the card for your routine food & gas purchases, pay it off each month, and it will cost you very little. There's a yearly fee for the double rewards card, but that can get paid quickly if you use it for supermarket purchases. As Robert says, make good business decisions to help alleviate the vacation cost.
Very well put Robert. I have been making the same argument for some time not, albeit not quite as eloquently as you just did. I wish I did not live in an area devoid of good regional parks. In Colorado we have Elich's and Lakeside. Now don't get me wrong I love Lakeside for the nostalgia and the price is certainly right. Elich's has only two decent rides and is mediocre throughout (I still miss the old Elich Gardens from my youth). I would love to live near Bush Gardens, Dollywood, Holidayland, Knots, Magic Mountain, Knoble's, Ceder Point etc. but I don't.
Perfect article Robert - bang on the money.
I wonder how to calculate WDW tickets today vs. the 1970s, when in the 1970s you had to PURCHASE ticket books as opposed to one gate price = unlimited attractions.
To the above anonymous poster: You named 7 amusement parks you don't live near. You misspelled four of them, and got one name wrong. That may be a record! ;)
I think that this assessment is true, although it seems that if you are willing to live like in the '80s while on vacation (no fancy food all of the time, no expensive character dining, braving the lines, etc) that you can do fine. When I went to WDW as a kid, I remember enjoying the waits for rides, the anticipation was awesome (especially at a ride like PoTC). For our next Disney vacation (probably a couple of years away), we'll seriously consider the Art of Animation resort, which is pricey per suite, but not if you bring grandparents along in the same room. While you can argue that Art of Animation is not a 'value'-priced hotel, I for one am very glad to see Disney throwing some creative muscle behind the lower-to-middle-tiered resorts. I was never interested in the 'value' resorts before (they seemed like cheap and cynical attempts to wrest middle-class dollars from off-property hotels), but with this one I think they hit the nail right on the head. I could see going and spending at least a day of the trip just hanging out at the hotel, as it is emmersive like the parks. So, I guess it seems like Disney is trying to do something here for the middle-class (not merely the upper-middle class) but maybe I'm looking at this too generously.
Great article Robert! I would like to respond to the person(s) saying they will continue to come here for vacation and stay on I-Drive instead of on property:
Here's one way around the high prices:
By the way, note to Mr. Niles: Looking sharp in that tie, buddy! Great photo of you and Mrs. Niles.
I appreciate this article, but it does not address the cost of living and how that has skyrocketed in recent years. More expensive costs for me means more costly goods and services used in theme parks and other entertainment venues. Yes, I can lament the good old days, but that is not the fault of the theme parks. It is reflective of our government "at work." I am much more careful as to where I spend my money. I frequent the Disney parks less often, plan better, and use creativity to pull it off. As for the smaller parks around the country. I'm sorry, they just don't appeal to me. I am accustomed to theme parks that are better with the details and thus they will still have my loyalty. I bring sandwiches and water bottles if I have to, but I make it happen on our budget
Why limit it, TH? We are often corrected even on those rare occasions when we
I'm pretty sure that these theme parks do not have to charge so much. Not only is it expensive in USA but here in Europe it's also expensive. So much so, i don't go unless i can obtain a discount offer. Disneyland Paris has become so expensive, so i always wait for discounts. And we all know that this park is a poor version of magic kingdom.
James: No, you're not. I mean, yes you are. I mean, that is, hummina hummina hummina..I don't know what I mean. I'm so confused.
All I can say is, I have enough money that I could enjoy a Disney vacation whenever I wanted.
Ah well ...
@ Charles: There is an abundance of "Magic" at WDW! If it weren't perceived as a good value by the majority of the tourists attending it would be spread like wildfire. It's just not the case.
Great article. To get more bang for the buck we plan, plan, plan. The tickets are the only real expense that has grown greatly over the years. We book a nice house rental for under 1k. With a big group of people that is better than the motels of the past. Food choices are everywhere today. 10. buffets, fast food, walmart frozen meals, that you can throw in the oven in your house rental. Far cheaper and time saver in the park, than the over-priced Disney restaurants. Still travel by vehicles and the cars are more gas efficient, although gas prices do rise. But nothing compares to the excessive cost increase of Disney tickets. And for what to build a Beast restaurant, with even more exorbitant prices? Star Wars redux, nice but about 10 years too late. Holding out hope for Avatar. We have been increasing our visits to Universal/Sea World to every 2 years and slow down on Disney from annually to now every 4 years.
@ David Brown
I think it's supply and demand. If people are willing to keep paying the prices to go to the parks, the businesses will continue to up the prices until they see growth of attendance slow.
OH MY GOD! I just saw the kid in the stroller! Could that be a young Blogger-to be?!
Walt Disney is rolling over his grave. His vision of a place where "ALL" children can enjoy time away from the problems of the world is now up for rent to the highest bidder. Disney has become the "Beverly Hills of theme parks". Someone please do an "Occupy Disneyland" so someone in corporate can see that greed is corrupting Walt's image of the "Happiest Place on Earth". Disney has become the new symbol of Corporate Greed and you can quote me on that.
GREAT ARTICLE and spot on!
With the increase in prices of everything people want to get every cent of there money's worth. This has caused nasty, mean, pushy people that ruin the experience for others. We have FL passes and lately we have gone in the parks and left in a short time because we could not stand the obnoxious people.
Because they can. As long as people are willing to pay - they can - and will. Sums up the article in two sentences.
I think your explanation is correct. As long as the price point fails to affect the bottom line, theme park operators will continue to increase the price. However, what about the original reason Walt open his park in '55? A place where everyone of any age could enjoy the day. A place where families can enjoy time together. And, by the way, time where parents could insist that kids leave their cell phones, and video games at home. I understand that raising prices can keep out the "rift raft," but it also limits the source of income for the park, and creates a financial fence that further limits what those who cannot afford the park can do. Even as a cast member, I cannot really enjoy the park outside the wandering about thanks to the free admission (which is really paid in sweat 60-80 hours a week). In truth, I think park operators have fallen short of their primary purpose: to make the most money for their shareholders. Even if they had a day to celebrate Walt's dream by rolling back prices for the day, it would be better than excluding those with incomes under six figures.
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