lockedoutlogic
DIS Veteran
- Joined
- Apr 26, 2007
One note. Disney has to choose between high ticket prices v. higher attendance.
As you pointed out they miss potential merchandising, food, and ticket sales from their price increases. However that 300,000,000 number you cited is offset by millions more willing to spend that money. Most guests are not going to spend more then a week at WDW. Trying to appeal to that small niche market (myself included) at the expense of capturing greater profit from the vast majority of customers is not good business.
If you're arguing that they should be making large additions each year to the parks to draw in that tiny market, that also doesn't make sense. Supposing they were going to spend 500 million on a new E Ticket to appeal to that niche what would they get? Say they get 20% returns on that 300 million which would put profits at 60 million. Between the construction cost of the new ride and increased operating costs incurred by the ride Disney would still not end up making more money short term.
It would take years before Disney would have the return on investment they're looking for. The problem with your argument is if by the time they had recovered costs the ride would already cease to placate the niche and they would've started reducing trip size again.
My question would be how much more time would you spend at the parks if they did open up a new ride? A day? Two days? Three? It seems unlikely one ride could make you do that. More likely Disney is pricing that niche out (myself included).
The premise is to expand the repeat, high spending repeat customer in an effort to extract "guaranteed" primary and secondary spending...
They tinkered with it in the past.
By "tinker" I'm talking about the annual pass program and the Disney vacation club...
And they are both phenomenal successes that have yielded billions in operating capital and walkaway profits.
Whatever his shortcomings...give Eisner a credit for that.
Now they are basically limiting park "additions" to what can be argued as the "bare minimum"...the argument can be made that its less than that.
And they are spending to fill in the lagoons in magic kingdom with concrete to pack in more tourists...and to have roped off areas to up charge for a view of the spectacular fireworks...
Which are closing in on 12 years old.
Boy...how time flies