What does Hong Kong Disneyland need to reverse its slide?
Disney's planned billion-dollar expansion of Hong Kong Disneyland
can't come soon enough, given the park's recent financial performance.
The park last year posted its eighth annual loss in its 11 years of existence, with attendance in 2016 dropping to 6.1 million visitors. That's down from 6.8 million in 2015 and from 7.5 million in 2014 — Hong Kong Disneyland's all-time best annual performance. Last year's attendance at Hong Kong Disneyland was the worst for the park since 2011, when it drew 5.9 million visitors.
For comparison with Disney's other "Magic Kingdom" parks, Walt Disney World's Magic Kingdom drew 20.5 million visitors in 2015, the latest year for which full data is available. Disneyland in Anaheim welcomed 18.3 million visitors that year, with Tokyo bringing 16.6 million, and Paris 10.4 million. Shanghai Disneyland appears to be on track to draw around 12 million visitors in its first year of operation, based on visitor numbers to date. Among all Disney theme parks, Hong Kong Disneyland is beating only the Walt Disney Studios Park in Paris, which drew 4.4 million visitors in 2015.
The problems in Hong Kong and Paris are not limited to Disney. The November 2015 attacks in Paris led to a sharp decline in tourism in that region, and a strong Hong Kong dollar versus the Chinese yuan has made that destination less attractive to visitors from mainland China. Hong Kong Disneyland lost 600,000 visitors from in the mainland in 2016 versus 2015, accounting for almost all of the 700,000-person decline in attendance between the two years.
Hong Kong's population is just under 7.2 million people, so Hong Kong Disneyland can't rely on its domestic audience to propel it to the attendance levels enjoyed by Disney's other Magic Kingdom parks. Hong Kong Disneyland needs international visitors, and with the one-two punch of a currency disadvantage against the yuan and competition from Shanghai Disneyland, it's unlikely that those visitors will be coming from mainland China anytime soon.
To entice more international visitors, Hong Kong Disneyland is adding a Frozen-themed land in 2020 and a major new Avengers-themed attraction in 2023. In the meantime, the park will change its Buzz Lightyear ride to a Marvel-themed shooter, build a Moana theater in Adventureland, and re-top its short, Anaheim-style castle to make it taller and more visually impressive. To house those international visitors, the park is opening its third on-site hotel, Disney Explorers Lodge, which opens April 30.
But will that be enough? Right now, Mystic Manor is the park's only major, unique international draw. The Big Grizzly Mountain Runaway Mine Cars provide another strong attraction, but it's not one unique enough from Big Thunder Mountain or Expedition Everest to draw fans who've ridden Disney's other mine-train roller coasters. And the recently opened Iron Man Experience might be Disney's first Marvel-themed ride, but it runs on a Star Tours-style ride system that many fans have experienced countless times already.
Given the relative ease with which many international visitors can enter Hong Kong versus Shanghai, Hong Kong Disneyland has a logistical competitive advantage over the newer, bigger Shanghai Disneyland park. But if we're talking about competition for international theme park fans in (or traveling to) Asia, Hong Kong Disneyland is going to have a hard time luring Disney and theme park fans away from the widely beloved Tokyo Disney Resort.
Hong Kong Disneyland needs to find a niche — whether that's pricing value, unique attractions, or just a clever marketing campaign — that allows it to prosper along with Shanghai, Tokyo, and even Anaheim in drawing visitors from throughout east Asia and the Pacific rim. And, given its recent financial slump, it probably needs all three.
Rate and Review:
GREAT use of facts to support a well thought out presentation!
Horrible, small park. Go look at the pitiful attempt at Toy Story Land - and you'll be nervous about what they might do at DHS.
Have you ever noticed that all international Disney parks fail/have failed. Oddly the only ones that have worked from beginning to now is the 2 parks that Disney doesn't own.
Hong Kong Disneyland needs a massive new attraction. Either Carsland or Star Wars Land. Marvel or Frozen won't add much to the mix. The park should also take advantage of the evening crowds that seem to descend upon downtown Hong Kong in massive numbers. Stay open longer with evening passes and offer evening foods like a night market.
What Disney should try to do is offer discounted tickets or even a free day for Passholders from other Disney parks as long as they stay at a hotel on property. That way people have an incentive to visit and those pass holders like myself are usually die hard Disney fans so we would jump on that opportunity. With the contingency of them needing to stay on property they still get money from hotels and any food and merchandise these pass holders buy. And of course the popularity would then spread quickly through word of mouth.
I think Disney's biggest problem with its International Magic Kingdom parks is that they're more or less cut copies of the same park. Except for absolute Disney fanatics (and I admit there are a lot), there's no reason for a visitor to want to go to different parks... If I'm a UK visitor, its not "should I visit Paris and Florida", its one or the other... with Florida likely winning that.
Add a Downtown Disney, another hotel a new attraction every year, big or small just keep them coming. And, heavy promotional events. By-the-way, why did they close Autopia so early?
Chad, I have to disagree. As an international traveller, the decision between which park you want to go to isn't based on which park is better, but which is in a more desirable location (unless the theme park is the primary reason for the holiday).
If you look at the other articles that the reporter in the South China Morning Post wrote about HKDL, you can see that Disney is not seen favorably by locals who refer to the HK government's original agreement with Disney as "unequal," which echoes the post-Opium Wars unequal treaties that China was forced to sign by Western powers in the 19th century. Disney is seen as heavy-handed by HK locals, who view Ocean Park as their local, hometown park. Mainlanders don't like how they're treated by HK locals and now have a bigger and better park in Shanghai. For international visitors, HK has lost its allure as a tourist destination to Singapore, Tokyo, Phuket, Bali, etc. Post-1997 handover, HK has been receding in profile and image into 'just another big city' in China. In the end this is Eisner's folly for desperately wanting to be near the China market after being rebuffed by China for the Kundun film controversy and blocked from Shanghai, which was always the true prize destination for Disney. HK legislators and citizens are balking at the big price tag for a HKDL expansion, though they have no choice but to continue to throw money at the park. Closing it down would be a surrender to HK's archrival, Shanghai, and signal the end of HK's aspiration to Asia's "global city" (HK government's failing PR ploy to maintain international relevance). In the end, the HK government will ask Disney to put up more of the funding for the expansion and take a bigger, probably majority, stake in the park. Further into the future, HKDL's prospects appear bleak not due to it being a bad park, but due to the structural and historical environment enveloping it.
It makes no difference, if Disney "invests" 1 billion dollars or 5 billion dollars. Hong Kong D.L. is not fixable. Pull the plug. If Iger sinks another billion into that park, it will be Iger's folly, not Eisner's.
I think it is a similar problem with Shanghai. If you can afford to go to a Disney Park, why not Tokyo, Anaheim, or Florida?
"To entice more international visitors, Hong Kong Disneyland is adding a Frozen-themed land in 2020 and a major new Avengers-themed attraction in 2023." And once again, Disney refuses to even consider building something original. If it can't be tied to an existing franchise, they want no part of it. Ticks me off.
Maybe Disney can sell "park hopper" tickets so guests can visit both the Shanghai and Hong Kong parks. They should create a vacation package that includes airfare between the 2 parks, hotels and tickets.
Is it possible that this may be the first Disney park to fail and close? And or be sold and/or be re-branded as not a Magic Kingdom? With continued expansion of the parks, odds are that this will happen at some point.
I can only imagine their dilema with this park. Spend a lot of money and hope it turns its fortunes around, but no sure thing. Scary. I bet some people's jobs are on the line with this.
Only 6 million per year! This is the place to be!
Honestly, I think the best option for Hong Kong would be to stabilize attendance, then do what is necessary to make the park work with the attendance they're getting. Unlike the other Disney resorts, there has never been much of a reason for anyone outside of the area to visit Hong Kong Disneyland unless they were already visiting Hong Kong for other reasons. Now that Shanghai Disneyland exists, there is even less draw to Hong Kong Disneyland for anyone that lives more than a few hundred miles away. The new attractions won't work as a long term solution...this park got a couple years of boosted attendance from building three mini-lands, but then everything started to decline again. To me, there's no reason to believe that history won't repeat itself.
I think they need to build a second gate over the esplanade from HKDL, on the expansion pad which is ready and waiting. Something totally unique (not a clone of another park... and definitely NOT a studios park). Something that will attract people from all over the region. It doesn't have to be huge (it can't be!). I think that the just have to think totally out of the box.
Considering that Paris Disney only achieved 13.5mil in attendance with a massive French population and all the surrounding European population, I would have to say that Hong Kong Disney with such a small population is doing pretty well with its attendance.
I wonder, is there opportunity for expansion or are they limited on land?
Greetings to all the previous posters.
Thank you Yeowser - its good to hear from somebody local who has a clear view.
Yeowser: Good insight, but I was saying "offer evening foods LIKE a night market". It won't be a substitute or replacement. It will be offering what many people are familiar with and offering Disney as an alternative evening entertainment. Disney in Anaheim and Orlando have both installed Festival Food Booths to cater to people's need to try out different cuisine. They can easily offer this concept in Hong Kong since it is familiar.
You know that theme park feasibility expert's credo about the entertainment industry in general !?
In response to grant crawford
Great input Yeowser. I think the idea of expanding to a second gate is an option, but no without (significant) risk.
China is only for a very short time letting western influences into their park. Japan has a longer relation with the Disney brand.
HKDL recorded HK$4.8 billion revenue and posted a HK$171 million loss. That's just 3.5%. A little more income and the park will make ends meet. This will happen with the Disney Explorer's Lodge opening on 30 April. It is very good for the park economically that the new hotel is able to open just before the Golden Weeks of China and Japan. Surely it will be hugely popular given the two current hotels enjoyed 97% occupancy during the Chinese New Year. The resort's future looks bright right now.
Re Anton M
O T. not buying it. during, many times of the year, there are more foreign born people at the Disney Orlando parks, than American's.
RE: Kelly - HK Disneyland park itself has a few small expansion pads left, but there's not a lot of space to grow that park significantly (not enough for a Carsland, for instance). For the new Marvel attraction that's coming in the next few years they're having to remove Autopia, for example. However, there is a large plot of land opposite Disneyland Park which appears to be set aside for a second gate. If you look on Google Earth or Google Maps it's pretty clear. It's a great location, with very little additional infrastructure required as it can be served by the existing esplanade, bus stops, train station and hotel.
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