What's the most important number to watch when looking at a theme park company's financial reports?
We just wrapped another round of earnings reports from Disney, Six Flags, Cedar Fair, SeaWorld, and Universal owner Comcast. It's easy to get lost in these reports, with their many lines describing revenue, income, spending, and business-school alphabet-soup items such as EBITDA [earnings before interest, taxes, depreciation, and amortization - if that helps].
But one item I always find interesting is in-park spending per capita. Basically, that's the amount of money that a guest spends beyond admission. It includes your spending on food, merchandise, line-skipping passes, on-ride photos, or other special activities, including character meals. Parking fees also can be included in that figure, as well.
Obviously, theme parks want to drive that number as high as they can. In the past, companies even have been willing to give up revenue on admissions, with lower ticket and pass prices, if they thought they could get it back with higher in-park spending.
So where are you willing to spend more? What things can parks offer inside the gate that tempt you into getting out your cash, card, or phone to spend more money?
With reduced capacity, parks have been focusing on driving higher in-park spending per visitors to help make up for big drops in ticket revenue. Higher prices are one way that parks can do that, but if parks raise prices too aggressively, fans often find ways to avoid them. You stop buying souvenirs. You eat lower-priced snacks rather than more-expensive meals. You skip the on-ride photos, upcharge attractions, or line-skipping passes. Everyone is experimenting right now, so I would love to hear from you about ideas about things you actually would welcome spending more to get or experience.
What's been your favorite thing to spend money on in the parks recently?
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