Disney and Universal Keep Building So Visitors Stay Longer and Spend More

The center of the theme park universe this week is adding more waterslides, aqua rides, floating mountains, and flying banshees — and, most importantly for their operators, fresh reasons for visitors to drop some cash.

As Walt Disney World Resort and Universal Orlando Resort ramped up to host simultaneous grand openings, top executives from their parent companies explained the bigger strategy to investors.

The bottom line: If you build more at the parks, people will come, stay more days, and spend more money.

“We look to make our park destinations must-see destinations,” chief financial officer Christine McCarthy said during the MoffettNathanson Media & Communications Summit last week. “We also look for projects that we believe cannot only drive new attendance, but can drive increased attendance through repeat visitations….We also look at extending length of stay, and most importantly we look at improving the guest experience because that is really key to getting repeat visitations.”

The company will hold the official opening on Saturday for Pandora — The World of Avatar, a new 10-acre land at Disney’s Animal Kingdom. McCarthy said that is an example of a project that will achieve the company’s goals, with themed rides, dining, retail, entertainment, and merchandise.

“So all of that comes together to make a very, very attractive and compelling experience,” she said.

McCarthy said expectations are for Pandora to provide a lift like Cars Land did at Disney California Adventure in 2012.

“We had an immediate increase in attendance and a lot of that attendance was very sustainable,” she said.

While Disney doesn’t release attendance numbers, the annual Global Attractions Attendance Report compiled by the Themed Entertainment Association and economics practice at engineering firm AECOM show the number of people who visited Disney California Adventure soared 22.6 percent to nearly 7.8 million in 2012 — even though the new land opened in June. The following year, attendance jumped again to 8.5 million.

McCarthy said the additional crowds at California Adventure also helped smooth out attendance between that park and neighboring Disneyland at the Anaheim complex.

“It balanced more of our load, our guest visitation across the two parks,” she said. “And we expect that same kind of phenomenon to be apparent with Disney’s Animal Kingdom, that this will draw more people into Animal Kingdom and will better balance the load throughout Walt Disney World.”

McCarthy said she expects an even greater impact from Star Wars lands coming to parks in Florida and California in 2019.

“We believe that these will also drive significant increased attendance that we believe will be sustainable in both Hollywood Studios, where the Orlando Star Wars is going, as well as in Disneyland,” she said.

Not to be outdone, Universal Orlando Resort is opening its newest attraction, Volcano Bay, on Thursday. The operator is calling it a “water theme park” rather than just a water park and considers Volcano Bay part of a strategy to keep Orlando visitors — especially those with older kids — within the world of Universal during their vacation.

Another part of that plan? Giving those guests places to stay right on site.

Michael Cavanagh, chief financial officer for Universal parent company Comcast Corp., said during a J.P. Morgan investor conference that the company is investing in more hotels with partner Loews Hotels and Resorts to extend the amount of time that visitors stay on the property. Once there, the idea is that they drive up per-person spending at parks and the admission-free CityWalk area.

“So we’ve got those levers that you’re trying to drive,” Cavanagh said. “And to do that and sustain growth, which has worked well for us, you’ve got to invest in the parks.”

Before Volcano Bay, Universal also opened the Race Through New York Starring Jimmy Fallon ride this year. And the operator opened wildly successful Harry Potter-themed lands in Orlando and California in recent years. A Nintendo-themed addition is also coming to Orlando at some point, though details on that have not been released.

The investment in new attractions isn’t limited to the U.S.

Universal is building a park in Beijing and will open a Nintendo world in Japan, where it also added a Harry Potter area.

Disney announced plans in 2016 to embark on a multi-year expansion of Hong Kong Disneyland, where a 750-room hotel just opened. And the company is expanding its Shanghai resort, which opened almost a year ago and has already drawn 10 million visitors.

McCarthy said that so far, two-thirds of visitors to the park have been from outside Shanghai, which has led to “very high” hotel occupancy and higher-than-expected daily rates and revenue.

“So those are all good things,” she said.