What can we do to stop the price wars? Or should we even bother?
Will you stop going to your favourite park when the price reaches an extravagant amount? Have you stopped going to your favourite park, or gone fewer times in a season because the price is too much.
We spend a lot of time complaining about the prices we're supposed to pay to get into the park, so let's find some solutions.
All in all the only park that's been semi-decent is six flags. Season passes for marine world were at $50, now there's a deal. But still they gauge you with $10 parking!
There's ways of defeating Disney at it's own game, but unless robert allows me to post them, I'll not type a thing. ( my 5 yrs of reserach into the amusement park industry has pulled up some interesting things, from emergency responses times to major weaknesses concerning ticket policies.) When money's tight and the mouse wants to rip every last dollar out of your wallet, you've got to do what you've got to do!! These tricks work at all other theme parks as well. People who've pulled them off were amazed on how well they worked and how much money they saved.
As far as my stance, I DID NOT renew my season pass to disneyland. Will renew with Six Flags though. The parking is a rip-off, but that's why you go with other people or better yet park somewhere and walk :-) I hear the santa clarita metro system is GREAT!
There are two ways in getting free parking at disney as well (and no not through an annual pass), but unless robert gives me the Ok, I will not post them. These two ways are legal too.
Jeez, maybe I should write a book on how to get the most out of Disney, without draining your life savings!
This is a lot more convenient. No need to sneak around or hide. It's about finding ways to save a dollar or two in an already over priced disney resort, without resorting (no pun intended) to running and hiding, and hoping no one sees you. :)
You know how much money those coasters cost, right? Between 15 and 25 million. How do you think they're paid for? How do you think they pay for the incredible amounts of employees that work there?
Is 35 bucks or whatever REALLY a lot to ask for considering you get an entire day's worth of world-class entertainment? This is why prices are so high. Before you guys can complain about amusement park prices, you'd better also take a few seconds to think of overhead costs. If you want lower costs then OK, but don't complain when you don't get new rides, every ride is not staffed for you to be able to ride on, and the park starts to look like crap.
No, I'm not happy with that. As a visitor, life was much easier when there was one rate to pay, no reservation systems to deal with, and an obvious order in which to ride the various rides.
But theme parks are much more complex these days. Which makes me happy, as a Web publisher, because that creates a huge audience for sites like this one, where people go to help make sense of the expenditure they are about to make.
So long as parks continue to make a wide variety of discounts readily available to all consumers, I'm not that concerned about the size of the "rack rate." Let's be sure to keep in touch with each other about those discounts, so none of us ends up at a front gate paying the sucker's price.
No need to get to the park when it's about to close either. Just go about your regular routine. Never a need to alter your plans, or to alter anything.
The parks pay some good money for insurance, never a doubt about that. Are there ways to lower insurance cost for these rides, and the park as a whole? You bet there is! But the amusement park industry is so hard headed, that they never look at the obvious,and that's what makes the amusement park industry such a unique industry.
And $50 to enter a park is a lot of money to today's american family. What a lot of you fail to realize is this, a lot of people aren't as enthusiastic about roller coasters and theme parks as you!
Cheers Noel G
Every amusement park in the world has several sources of revenue, many of them are obvious, others are highly difficult to analyse without significant financial background.
1. Gate Admission
This is the direct way of raising cash, and often the most important way of raising revenue for park expansion, however as I will demonstrate it is not the only way forward.
2. Season Passes
Season Passes were begun by Six Flags in 1996, they have proved extremely popular for themeparks, supplying a lump sum up front for the rest of the year whilst some themeparks depend too much on season passes, like Six Flags, others do not, such as Parc Asterix. The last financial figures from Six Flags revealed season pass sales last year were down across the country.
This is done through either direct sponsorship, or combined marketing ventures. Many parks ignore this vital source of revenue stream, most have sponsorship, but marketing schemes and music video advertisements could raise huge sums, if management were willing to investigate.
4. Corporate Trips
These attract good sources of revenue, but if a park must close to regular guests at the same time as having corporate events, the park may find it unwise to do such deals. However, these are a good source of streams in the off-seasons.
5. Parking Admission
Parking is becoming increasingly important across the world, but many themeparks have still not seen the advantages in automated ticket machines, adapted from car parks, instead they rely on expensive human deployment ticket staff.
There are others, but cost reductions can be made throughout the business, I personnally prefer spending on advertising than rides, they are increasingly more likely in an economic downturn to become more dependable in future growth.
If we can convince parks to do this, how do we make that translate into lower prices at the gate? Or would most people be happy to get more for their money, to see the parks re-incest the money in more/better rides/shows?
I honestly think Disney wants to raise prices to encourage people to buy their multi-day passes, which are overpriced too. Who needs three frickin' days at those two parks?
12 or more hours spent at a theme park for just $50 or less seems like a good deal to me!
However, the newer trend of allowing outside food vendors into theme parks is something that should end right now! It doesn't benefit anyone. The theme park doesn't get the full concession profit because they're purchasing the brand, the brand doesn't benefit because they have to charge extra for their concessions to offset the cost of leasing the pavillion, and the guest doesn't benefit because they're getting the same food they can get outside the park at a 25% or more markup along with eliminating traditional theme park fair.
In the end, theme parks will only go as far as the guests are willing to go, so if they can get into the red with admission prices at $60, that's what they will charge. It's all supply and demand, and as much it may seem to suck, most theme parks are actually worth the cost of admission, especially if you buy a season pass.
Many of the problems we see in the theme park industry today, and in the economy in general, are due to the proliferation of MBAs in companies' management ranks.
Sorry, management is not a distinct skill that can be separated from knowledge of what a company produces. Attempts to do that inevitably reduce managers to spreadsheet jockeys and number crunchers, who gut a company's long-term position for maximum short-term gain.
An experienced manager, who gained his or her position by working in the company rather than going to a business school, would know that bringing in a bunch of outsiders would hurt the company's revenue in the long run. That's why the Disney company (who had such managers back then), spent the 1970s and '80s buying out all the outsiders that Walt had to bring in to get the Disney parks launched.
Another point to consider, here -- insurance. Theme parks are trying to pass along higher insurance premiums through admission increases. Long term, prices are set by customers' willingness to pay, and not sellers' production costs. But theme parks are going to this airline-style multiple pricing system in an attempt to fleece a few suckers, while not driving away the hard-core fans who are likely to find discounts.
That said, I think we'll soon find out that the insurance industry is pulling the same sort of scams that Enron and the energy industry were pulling two summers ago. Don't believe anyone who tells you that larger court judgments and increased claims are driving premiums up. Nope, it's insurance companies trying to cover their losses in the stock market and a few players in a consolidated market trying to exert market power that's too blame.
If we had real anti-trust and securities enforcement in this country, the insurance industry wouldn't be able to pull this off, and theme parks would have one less expense hurting their bottom lines.
If you get a season's pass, then your locked in with a good rate for a year, and the renewal rate is usually cheaper than the current going rate!
Yes, it is a pain to shell out $50 for the Orlando parks, and to pay anything for SF Over Georgia. But they continue to build, and we all have to eat, therefore the prices to up.
If you complain about paying, that's your problem. Just remember all the moaning and groaning your doing when your on the newest and fastest coaster with a big smile on your face!
By the way, I DO NOT work at a park, I just understand business!
David, so what has Disney built that is "bigger, better and more expensive?" They haven't built ANYTHING like that since Indy in 1994, so that excuse goes right out the door. What about DCA? That park's barely WORTH a couple bucks. I clearly stated elsewhere that rising prices are fine, if the parks are giving you something for those extra bucks. Of the parks who have raised prices (USH, DCA, DL and SWO) only USH is offering up a substantial attraction this year, and even theirs won't show up for another 5 months or so!
As for the costs to run the parks, you could probably find that in a Disney financial report, if you can slog your way through that thing. Problem is, the parks are ALL profitable as is. Disney's are so profitable that they are the largest moneymaker in the world of Disney. So this has little to do with needing the money as it has to do with seeing if they can get away with it.
If a park wants to use the extra money from a price increase to fund new attractions -- great. But, as I've said before, price is a function of demand, not a park's expenses.
That said, I think that much of the opposition you're seeing here to Disney's price increase is due to frustration with the company over the past decade. Russell, you say that the 50th anniversary rehabs are coming. But word from inside the company suggests that many of those proposed rehabs are being scaled down or eliminated entirely.
Many theme park fans simply don't trust Disney anymore, after debacles like Light Magic, California Adventure and Tomorrowland. They want to see Disney deliver a real improvement before forking over any more admission money. Promises of future improvements from Disney won't cut it with those consumers anymore.
Animal Kingdom is another story. That park is just totally lacking in attractions. It is relying on it's animals to provide the entertainment, and aside from the bird show, there are no formal animal shows. That means Disney is counting on kids to sit still in the hopes that a sleeping animal will do something cool. Disney definitely should have planned at least one more e-ticket attraction prior to opening AK, but they took the gamble, and they are having to pay for their decision. AK was a nice park, but having the National Zoo(free admission) 20 minutes away, I don't see myself paying $50 for that park again until one or two more rides are added. But again what should Disney do...Do they plunk $200 million into a brand new park for two custom attractions that will most likely be big hits and a new land(assuming the beastly kingdom rumors), or a few well themed stock rides that everyone on this site will grumble about for one tenth as much?
Sometime I wish I was an insider and knew some of the reasons why decisions are being made, because it is very possible that we are missing the boat on a lot of Disney's reasoning, and they think that they're doing what best for us, but are relying on bad sampling data that doesn't represent the majority of guests who visit their park, or maybe we don't represent the majority of the people who visit their parks. It is possible that the growing popularity of Six Flags and Cedar Fair has lowered most people's standards and don't expect as much out of Disney as some people do. I would be willing to guess that about 50% of the people who visit Disney parks weren't alive when WDW was first built(that includes me), and about 25% weren't alive when EPCOT was first built. So a lot of people who are visiting their parks do not fully understand Disney Magic. I think it's still there, but Disney's attempt to cater to so many different people, they have lost what was essential to their success. They are also trying to stay current but still providing "family entertainment." What was cool to us as a kid is not cool to kids of today. Disney is faced with the dilema of pleasing the purists who want to keep old "classic" attractions which cost increasingly more money to maintain and rehabilitate(Matterhorn), and youngsters who are looking for more exciting and more thrilling attractions then we ever experienced as a kid. So what do you do, do you tear down Space Mountain and build a new Space Mountain which pisses off the parents and pleases the youngsters, or do you spend almost as much money to rehab the Matterhorn to please the parents and the kids go to Six Flags to ride something more thrilling?
As for DCA, Russell, you have no idea how cheap that park is. Put it this way... IOA cost just over a billion to build. DCA cost the same, if you include Downtown Disney, the roadwork and the new garage. I would guess that DCA itself cost no more than 600K. Which means it cost HALF of what IOA cost. And the vast majority of the money went into shops and restaurants and not into rides. For every Soarin' Over California, there is one clone and one off-the-shelf ride. And their allegedly "custom" attractions are basically three: Soarin', Screamin' and the Grizzly River Rapids. I wouldn't even count Golden Dreams, since it is just a film, or that Limo thing, since it was cheap and closed so quickly. The park is ugly, cheap and there are few attractions of any worth inside it. At least AK is pretty and has animals.
First, you can hire new forecasters that are more able to predict trends in the industry, currently most parks are gaining 1-10% each year in admissions, so to predict anything more than that would not be a sound practice. Forecasting is a difficult job, but forecasters know that its better to error on the side of caution, and if that's not being done, then new forecasters are needed.
Second you could lower admission prices/keep them steady. This will allow the parks to maintain the status quo, and theoretically gain at the same rate as the previous year. That also asumes that the previous year was an "average" year. Obviously if a park is nearing capacity on many days throughout the year, then lowering prices would be out of the question, because then the quality of the experience would be deminished.
Finally you could raise admission prices. This is course that many parks are taking. Comming off a year where many parks are still trying to find their identity after 9-11, most parks experienced modest growth. Additional growth is expected in the comming year, so it seems logical to raise prices, not only to maximize profits, but to manage growth. If a park grows 20% in the next year, how is it supposed to come close to matching that growth the following year? Most parks don't have the ability to expand to meet that kind of demand, so by raising the admission, you control the rate of growth while increasing profit margin. It's been proven that many people will still go to the parks regardless of the price, so why not make the most out of the situation while creating a "nest egg" for future expansion.
If your park is having trouble handling the crowds today, as evidenced by Marc-André Routhier trip report over New Year's week, then raising the price can control the growth tomorrow and allow time for the park to expand. It's all about "growing pains," and I think Disney is experiencing them, especially in the Magic Kingdom and Disneyland(more so because of the closing of marque attractions).
Thanks for sharing!
I would like to present a different perspective on pricing. Pricing in every business is hot issue. Nobody likes to spend a lot of their hard earned money.
Problem #1 : The average family income in Canada and the US hasn't been soaring over the last few years. Inflation was controled. Many people have even lost a lot of their retirement money invested in stocks.
Conclusion: People don't have more money to spend on entertainement.
What do people do when prices are moving up but not at same rate as their income? They think twice before spending it? Are they making the right decision? Can they have as much fun while spending less on some different experiences? If i still want Disney would I go as often?
Also: We are all making one crucial mistake when taking only the admission price into consideration. A 2$ increase seems like nothing but we are forgeting that, for most of us, going to a theme park means hotel, airfare, food,...
The actual price of a one day experience at Disney cost me : 300$US/day during the holidays. Not 50$. This price includes food, air fare, hotel, park hopper.
People are not complaining about the 2$ but about the overall cost/day.
When I went to WDW on dec 28th and realised that every key ride was packed, it pissed me off to pay 300$ US that day just to make 4-5 rides and eat hotdogs/fries.
The theme park offering for travelers is so much expensive that people will look for altenative entertainement. This opens the market for new comers and reduce, to my opinion the long term growth of this industry.
Finaly about Disney strategic thinking
I disagree with your reasonning about family entertainement. You are saying that parents want to keep old rides and youngsters want thrill. To me it's not showing on attendance figures. MK has much more visitors then any other park. Even today. This means old and magic is still prefered (2 times more then thrill parks). What does it mean?
We are still hit by the techno wave. Theme park executives are fascinated by technologies and are replacing creative content by it. It's easier, take less time and less creators.
Thrill without content is empty, doesn't touch people's heart.
Thrill has no lifetime (thrills rides are obsolete very quickely)
Thrill is only a trendy thing. Now weightlessness is hot. In 10 years it will be something else. In 10 years they will have reinvested and reconstruct everything.
In 20 years Peter Pan will still be magic. Not Mission Space.
So overall I think they should go back at making great stories and making rides with them instead of try to please thrill seeker that will never, anyway, be satisfied completely.
Have a good day
First of all thank you for your kind and gentle response.
I would like again, to express my point of view. When you say : "If heart warming stories are so critical for success, then why is Disney loosing market share?" there is a logical answer to it which is: " Because Disney's stories are no longer heart warming"
Most of their stories are predictable, standard predesigned scenarios (just read books on the matter you will see, it is stuning) that deliver standard movies. We haven't been touched deeply by Disney in many years. Yes, Toy story was good, but heart warming? The only thing that touched my heart recently was The Lion King. But again a sad story of a baby lion trying to survive in the evil world and eventually by miracle achieve freedom and social power.
I sincerly believe that the trend in screenwriting is way too psychological. Always someone trying to overcome personnal problems, loneliness in such a dramatic way that i wander where is the entertainement. Peter Pan use to fly. Who would't like to fly by magic power? Ok he needed to face the cruel capitain but it was in a fun, childish environnement. In today's movies we see too much super hero like Buzz Lightyear in real environnements reminding us of a tough life, a tough world. This is where I think most screenwriters are making a big mistake. Entertainement serves escapism of everyday problems not virtual close up of problems.
To move people you need to put them in a world where they would dream to live, dream to experience things. They don't want to be reminded that life is a bitch and that if you transform yourself you will succeed. (LIFE AS A BATTLE). Do you remember the following song in Mary Poppins: "Just a spoon full of sugar helps the medecine go down...."
We are far too serious and psychological today in entertainement or too funny without good heart warming content. This observation is based on my personnal values. You may think differently but in my opinion nothing will ever beat warmth, caring and love in entertainement.
I strongly believe that Disney's problems are related to the fact that they are no longer able to touch us deeply, to make us forget the present in order to enjoy a happy moment of life.
Have a nice day
All i'm saying is that i'm not attached to the twilight zone story. OK the ride was a physical thrill to me and attractive. But there was so much people on my last visit that i decided not to go. Was I greatly dissapointed? No. I was much more pissed off not to be able to go again in Peter Pan the ride because it was too crowded. I'm attached to the magic of the story and to fly in the air.
Teen and young adult will love TOT. But in 10 years will you still want to go to WDW to ride TOT? Is this what you will be looking for? Or will you demand newer more thrilling rides? Will i still want to see Peter Pan in 10 years? Yes!!!!! That's all I'm saying. I think very great stories will last forever and their rides too. I guarantee you will see the Pirates of the Carrabean ride in 20 years. I doubt you will see TOT in 20 years when you will be able to fly over the earth for 500$/ticket. TOT thrill will be nothing compare to this incredible experience. As you know, US companies are building planes right now to fly over the earth atmosphere in the next 5 years.
Thrill will kill WDW. They will fight whoever has thrill including a 1/2 hour flight over the earth. Do you think that they will beat that?
(So... sorry, Russell.)
On June 20, walk past any bookstore in the English speaking world, and you'll likely see dozens of children lined up, waiting for the chance to buy a book.
Not any book. A 1,000-page book. And, come midnight, when those kids can buy the book, many of them will sit down and read the entire volume, cover to cover. Tens of thousands of children will stay up, day and night, reading, until they finish the thing. Kids' attention spans are just fine, thank you. It's the quality of so much of the stuff they are given to watch to that is diminishing.
Disney, Universal or any entertainment company can command an unbelievable amount of attention and focus from the world's children. And its adults. All they need do is quit churning out garbage and instead invest the time, money and talent to find the next Harry Potter.
My little 12 year old has read these books at least 3 times each and is still tempted to read them again and again. I guarantee that if a park is built on the Harry Potter theme she will want to go again and again and again. She is desperatly waiting for the 5th book not because she's getting bored of the old one but because she wants to know the next step in Harry's adventure.
What Theme Park business people don't seem to understand is that they are building and selling characters and stories to whom you are attached to.
Carefull: The sucess is not only due to the studio's marketing strategies. Marketing alone is nothing. Without a very good character, it won't last. Exemple: Treasure planet. Even with enormous marketing ressources, no kids are attached to the hero. The story is too ordinary and the kids are not buying into it. Marketing is not the prime reason for sucess. The characters and the attachement to them are the key reason for the sucess.
Also sales figure is not the only thing to take into consideration to evaluate the attachement of the public to a character or story. The longivity of the characters will determine the level of attachement. We need to look over the long haul. Just trying to make X millions instantly is a very dangerous marketing strategy. Some classics took years before becoming famous. Today, we judge people and companies by the level of immediate success. It took Walt 30 years before creating a permanent bond with the american people. Asking for immediate successes is killing creation. It is asking all creators to adapt to trendy matters and walk away from profound inspiration. Sales should be there to support further creative efforts and give guidance but not to rule the orientation of a company. Only it's core values should dictate the future of a company. Strategies can change but not the values.
In conclusion: The key to any long term profitability and building a franchise is solid stories and great characters.
Unfortunatley, Disney is no longer able to create animated classics because they have become a film machine. They are no longer creators. The start of a production is no longer the magic but the need to produce X, Y Z. It's doesn't start from the heart. They make movies to make revenus and no more to explore the vast possibilities of the human mind and heart. Because of that they need artificial thrill to compensate for the lack of content. So they invest tones of money on great images, graphics and few on creation and rich character building. They have emptied the well of creation. They now have technician producing movies. No more creators. This is why we feel hungry after seeing Treasure Planet.
Too bad they don't understand it.
But I have to agree with Russell on the fad thing. I HATE Harry Potter.
Off topic, but that magic died with Frank Wells and I totally agree with you...the Parks at one time were run the same way, with love and magic before the bottom line. Maybe one day Disney will wake up and remember what made the films and the parks the wonders they are.
Walt Disney World's Magic Kingdom
Disney's Animal Kingdom
Disney's Hollywood Studios
Disney California Adventure
Universal's Islands of Adventure
Universal Studios Florida
Universal Studios Hollywood