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Credit: Disney Parks Blog (background)Executives at The Walt Disney Company have claimed in the past that the solution to over-crowding at the Disney Parks would be variable pricing, but the strategy has failed so far.
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Over the last year, executives at Walt Disney World Resort and Disneyland Resort have pointed to a specific solution to help with crowd control at the Disney Parks, a variable ticket pricing plan. Last year, Disney CFO Christine McCarthy announced that The Walt Disney Company would look into Disney Park pricing as a mechanism to help grow its revenue and control crowd sizes. She would go on to say in the earnings call:
What is different is, compared to the last time we had a slowdown in the economy for managing our parks business, we have more commercial tools and levers available to us. One of the ones that’s quite obvious is discounting. That’s something that we have used in the past, and we will continue to use it because it is an effective lever for managing your yield.
But we’re not going to use it to the extent to which we used it during the last recession. Some of the other things that are new would be the reservation system. So, you know, we manage attendance now. We can track it real time.
On many days, we are fully booked now. But we can adjust that and be very flexible in real time on adjusting it, if we if we so choose. The other thing is we have a tiered pricing structure that gives us a lot of flexibility. And we also have reimagined our annual pass business model.
And we could also have some more flexibility in using our annual pass program. We also have technology advancements, and this is more on the expense side. That provides us opportunities for cost flexibility. So, we have things like mobile ordering, contactless check-in.
So, those kinds of things give us levers on the expense side. But we do feel that we have — you know, once again, hearkening back to the opportunity we took during the pandemic, we did permanently remove a significant amount of operating expense at the parks. And that better positions us right now as we go into an uncertain economic environment.
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However, according to TheStreet.com, the variable pricing strategy has not succeeded. The latest report would go on to say, “To put it bluntly, that plan hasn’t worked, at least partly because while many families would want to visit on the cheaper days, those days never line up with when kids aren’t in school. That’s why Walt Disney’s Theme Park complex has seen packed crows in March.”
During this spring break, ticket prices have been sky-high, yet the crowds in the Disney Parks are packed.
What was the response? Extending Park hours. A few days ago, Walt Disney World Resorts Magic Kingdon, Disney’s Hollywood Studios, and Disney’s Animal Kingdom received extensions on operating times in April of this year. However, nothing was announced or changed for EPCOT.
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Either way, at this point, Disney has some work to do to get the overcrowding problem solved.
How should Disney control the Theme Park crowds during the busy seasons? Let us know what strategy you think Bob Iger and Josh D’Amaro should take.