Attendance remains below prepandemic levels, but Disneyland and Disney World are making more money than ever. The company has raised some prices and eliminated or started charging for other services and features that used to be free.
By Robbie Whelan and Jacob Passy of The WSJ. Excerpts:
"These days, Walt Disney Co. DIS -2.89%▼ has a new magic trick: wringing every last dollar out of each visitor to its profitable theme parks."
"The results reflect a major strategic shift on Disney’s part, where the company is focused less on maximizing the quantity of visitors and more on increasing how much money each visitor spends, an approach the company refers to as yield management. Improving the visitor experience, the thinking goes, will prompt guests to spend more hours—and therefore more money—at the parks because they are having such a good time."
"The biggest change in the past two years—and the most lucrative for Disney—is the introduction of a smartphone-app feature called Genie+ that costs $15 per person a day, on top of the price of admission, and allows parkgoers to skip the unreserved lines for some attractions, which the company refers to as “standby.” But Genie+ doesn’t cover everything. To skip the standby lines at the most sought-after attractions, including some Star Wars and Guardians of the Galaxy-themed rides, reservations now cost an additional $10 to $17. Standby waits for popular attractions can last hours.
At the same time, many benefits that used to be free—from parking for certain annual passholders to airport shuttles to MagicBand wristbands that serve as combination hotel-room keys and park passes—have been eliminated or now come with a price."
"Disney’s theme-park pricing is determined by “pure supply and demand,” said a company spokeswoman. “No different than airplanes, hotels or cruise ships.”"
"annual passholders at Disneyland account for about one half of annual visits—but . . . annual passholders tend to spend less than other visitors per visit"
"A typical annual pass holder might ride only one ride during a visit, eat an ice cream cone and walk around for a few hours, taking up capacity that might otherwise be used by out-of-state visitors"
"About half of visitors to the parks pay for and use Genie+"
"of those who pay for Genie+, 70% say in post-visit surveys that they plan to do so again"
"Disney has stopped selling nearly all new annual passes to Disneyland and Walt Disney World and has done away with a host of free perks that annual passholders used to enjoy. Existing annual passholders can renew their passes, although earlier this month, the company raised the renewal price for its highest-tier annual passes to Disneyland by 14%, to $1,599 from $1,399, while at the same time introducing more blackout days when passholders can’t visit"
"The new reservation system has allowed the company to limit attendance without having to turn visitors away when the parks become overcrowded, as it occasionally did in previous years.
The company also points out that it offers frequent promotions, including discounted room rates at its hotels, packages that become more economical the more days a visitor spends at the park, and discounts for residents of Southern California and Florida."
"Some longtime fans who come to the park regularly, and aren’t splurging on once-in-a-lifetime memories, complain about the new fees."
"The Genie+ app feature replaced a system known as FastPass that used to come free with any ticket sold at Disneyland or Walt Disney World. The new service—along with a free version, known simply as Genie—does more than make Disney money: It also helps the parks’ operators direct traffic and spread people around the parks more evenly, to reduce waiting times overall, and upsell visitors by offering them promotions on food, merchandise and ride-reservation fees.
Each park has an operation center with a “heat map” that tracks where Genie+ users are in the parks using GPS technology. Park operators can direct traffic using the app by notifying visitors where the shortest lines are and offering food and merchandise promotions to cajole them to other areas.
“If I’m seeing too much activity on the west side, I’m able to spread where I direct people to the east side,” Mr. D’Amaro said. “Our attractions will be load-balanced better, and lines will be shorter, and what that means is the experience will be better.”
In an analysis for The Wall Street Journal, Touring Plans analyzed room prices, including taxes, at three popular Walt Disney World hotels over the past decade, and found increases that far outpaced inflation, which in July hit a record high of 9.1%."
"Prices for tickets and certain food items have also climbed faster than inflation over the past decade, the Touring Plans analysis found. Disney fan blogs have noted that classic purchases at Disney parks, including the pineapple Dole Whip frozen treat ($5.99 last year, $6.99 this year at some locations) and studded Mickey Mouse-ears headbands ($29.99 last summer, now $39.99) are quickly getting costlier, outpacing inflation."
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