The idea that a giant tourist attraction like Disney could fall victim to price sensitivity, especially under the current macro economic conditions, is telling. It further underscores that if theme parks are going to charge an arm and a leg, they need to deliver an experience worth the price tag, to remain competitive.
Are wait times shrinking at Disney Parks? Is that a sign of weak demand? That was the claim in a recent article in the Wall Street Journal, a claim CEO Bob Iger pushed back on in a CNBC interview this week.
Traditionally, waiting in line is part of the theme park experience in Orlando or Shanghai, and data from Tour Plans marked the past 4th of July weekend as one of the slowest in years for attendance.
Roger Niles of ThemeParkInsider.com, a newsletter focused on Disney, said wait times are a flawed indicator of theme park attendance, especially for a 4th of July that falls on a Tuesday.
“To say that Disney World’s attendance is tanking or that the parks are empty is a wild exaggeration at this point,” said Niles.
Niles, who said he has previously worked at Disney World on multiple 4th of July stints, believes the holiday’s dynamics, block-out ticket promotions on the date that cannot be booked by Disney pass holders only regular visitors, weather warnings and competition for other Florida experiences like Universal Orlando or SeaWorld are all factors that could cause the wait-times signals to be misinterpreted.
Visitor figures were already increasing, as the signals shifted from a 27-minute wait according to Tour Plans on the 4th of July, to the two-hour mark on July 13th, as detailed by the World of Disney App, said Niles.
Tour Plans founder Len Testa, who initially noted the wait times on July 4, agreed though also noted a push to Disney’s other products, such as cruising.
“We’re seeing the end of Revenge Travel from 2022. And people are moving on to other things beyond theme parks,” said Testa, as indicated by Port Canaveral performance data, which is about an hour east of Disney World in Central Florida.
“People are traveling, they’re just going to places other than theme parks,” said Testa. “Disney is very expensive. The average trip we see is around 5 days in length and costs around $4,800. That’s typically a family coming from out of state and staying at a Disney resort.
“For perspective, that’s over twice as much as the average American household spent on travel for an entire year in 2019, according to the U.S. Bureau of Labor Statistics,” added Testa.
Testa said his platform’s users have complained that instead of going to Disney World to see its version of Italy, you could actually go to Italy for the same amount of money.
The ongoing legal dispute between Disney and Florida Governor Ron DeSantis is another factor.
One travel agency Skift spoke to, The Vacationeer, said its clients on both ends of the political spectrum are choosing not to travel to Disney World.
“On the left they don’t want to travel to Florida because of the Governor and harsh laws around immigrants, and on the right they don’t want to support a company that they view as woke. We get it from both sides,” said Jonathan de Araujo, the agency’s owner.
Despite this, De Araujo stated sales were brisk for the upcoming November holiday period and spring break
Jason Cochran, Frommer’s editor-in-chief, who has been covering Disney for well over two decades and authored its Disney Guide, thinks it would be wrong to read too much into holiday numbers but does see potential for future weakness.
“I think Iger is a little bit correct in that it would be wrong to say Disney is failing because of the low attendances that we observed earlier this month. I was looking online, and the wait times for a lot of the major attractions in Florida right now are near normal.”
But Cochran said Disney will have a problem maintaining numbers because of lack of investment and aggressive pricing.
“I think Disney is having a hard time investing in the parks because it’s so busy using the parks as a cash cow,” he said, referring to Disney’s investments into 21st Century Fox and its focus on building content for Disney Plus.
Universal’s new theme park set to open in 2025 is another threat looming on the horizon for Disney, according to Cochran.
“They have minor attractions that they’ll try to wring as much publicity out of as they can, but they’re not major attractions. And that’s a problem, especially in the theme park world in Orlando where you always have to have the newest, latest and greatest,” said Cochran.
Disney’s current price point, particularly for its hotels, is a bone of contention, according to Niles who suggested the strong attendance at rival parks such as Universal, Busch Gardens, and SeaWorld, may have been at Disney’s expense.
Disney’s attempt to draw crowds with ticket deals and dining plans may get visitors through the gate, but they haven’t significantly boosted hotel occupancy, he added.
Adding to the complexity, Disney also enforces advance reservations where guests with Walt Disney World tickets for a specific date have to make the extra step of booking a theme park reservation to use them, a practice introduced during the pandemic that other parks have abandoned. The company is looking at removing this requirement by 2024.
Another hiccup in Disney’s strategy is its Vacation Club, added Niles, which has become an elaborate workaround for many visitors to secure more affordable hotel stays. However, this has inadvertently complicated the process for first-time visitors or those who simply want a one-off Disney experience.
“In general, parks across the industry are continuing to have a good year this year, after some horrible years in 2020 and 2021,” said Niles, ” If anything, I think Disney’s having to share some of the success in the industry this year, which they’re not really used to doing. So this is a little bit humbling for Disney. But humble for Disney is still the most-visited theme parks in the world.”
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