Walt Disney World Magic Kingdom Discussion Thread

[xstech25]

Is Disney even making enough money off of this to make it worth the effort? It looks like there are only 3-4 cabana's, so just a few thousand in revenues a day (assuming they sell out). The average family that goes to WDW probably spends the same as a days worth of cabana sales. If they put them in all 4 parks and sell out every day that's about $3 million in revenues for the whole year for the whole property. When you consider:

-The added staffing & health care. I know its not a lot of employees, but covering 4 theme parks day & night 365 days a year, if each employee is making $20-25k, after you're done paying insurance & taxes on all of them...that's a huge expense.

-The maintenance of the units, the A/C, furniture replacement when something gets damaged or needs to be replaced due to the humidity.

-The same amount of money is made if you have 20 priced at $100 or 3 priced at $650...there is obviously a very small set of people willing to shill out $650 for a tent while at a theme park, so you can't just add more without lowering the price substantially.

 

Consider this one a head scratcher to me. Doesn't seem to be worth the time and headache, and making the parks look tacky just for a couple million in revenues IMO.

[Jew]

Is Disney even making enough money off of this to make it worth the effort? It looks like there are only 3-4 cabana's, so just a few thousand in revenues a day (assuming they sell out). The average family that goes to WDW probably spends the same as a days worth of cabana sales. If they put them in all 4 parks and sell out every day that's about $3 million in revenues for the whole year for the whole property. When you consider the added staffing & health care (I know its not a lot of employees, but even just adding a few can be very expensive), the maintenance of the units, the A/C, etc it just seems like a waste of time and effort.

 

I think you are overestimating the cost. I also think you are severely overestimating how much an average family will spend in a day---it probably isn't $649 (admission is not included with the cabana, so that doesn't count).

 

I'm all for Disney finding every which way to make more money without having any impact to the average guest experience. I have no doubt these will sell quite well---they wouldn't bother with testing it if they didn't already know there was a market for a place where people can go and relax away from the hustle and bustle of the park without having to go all the way back to their hotel.

[SharkTums]

Is Disney even making enough money off of this to make it worth the effort? It looks like there are only 3-4 cabana's, so just a few thousand in revenues a day (assuming they sell out). The average family that goes to WDW probably spends the same as a days worth of cabana sales. If they put them in all 4 parks and sell out every day that's about $3 million in revenues for the whole year for the whole property. When you consider:

-The added staffing & health care. I know its not a lot of employees, but covering 4 theme parks day & night 365 days a year, if each employee is making $20-25k, after you're done paying insurance & taxes on all of them...that's a huge expense.

-The maintenance of the units, the A/C, furniture replacement when something gets damaged or needs to be replaced due to the humidity.

-The same amount of money is made if you have 20 priced at $100 or 3 priced at $650...there is obviously a very small set of people willing to shill out $650 for a tent while at a theme park, so you can't just add more without lowering the price substantially.

 

Consider this one a head scratcher to me. Doesn't seem to be worth the time and headache, and making the parks look tacky just for a couple million in revenues IMO.

 

You're not thinking big picture. Do you really think Disney is only going to put in 3-4 Cabanas and make them look temporary like this? Consider this a test for a MUCH larger, permanent roll out.

[Hilltopper39]

I was at the Magic Kingdom on Saturday for most of the day, we never made it over to Tomorrowland where the cabanas are but it was kind of odd that I didn't see any kind of advertisement for them anywhere else in the park. Maybe I just missed it but are they advertising these things in the resorts or anywhere else on property?

[DirkFunk]

Is Disney even making enough money off of this to make it worth the effort?

 

Operating and maintaining the cabanas, along with staffing (part timers don't have access to the same sorts of plans as full timers, and who says full timers will maintain/operate them?) probably wouldn't cost more than $200K a year (assume 20K for startup/repairs, 4 full time $10/hr employees w/fringe rate of 40%, 6 college program kids @ $9/hr on 6 month contracts = 190320), and operating at 75% occupancy for 12 months, you're talking over $700K in direct income plus additional income from food/beverage purchases made in the cabanas. That's half a million dollars before you add in the other indirect spending.

 

HAVING SAID THAT: This being tested at the exact same time as Express Bus Service (through backstage!), the Ice Cream Social Cruise, a new festival at EPCOT, and the Monorail Food Tour is not an accident. Attendance is dropping overall at the parks and they are trying to keep their revenue margin high by getting the people there to spend more money any way they can. There will be more and more and more special events to try and drive business. Is that necessarily bad? You make that call for yourself.

[Hilltopper39]

The Express transportation thing actually sounds like a pretty decent idea, if I were visiting the resort for 4 or 5 days and planned to park hop a lot I'd easily pay the $12 or whatever it was for that service to avoid the trams, and the security check lines, and stuff, especially at the Magic Kingdom.

[xstech25]

HAVING SAID THAT: This being tested at the exact same time as Express Bus Service (through backstage!), the Ice Cream Social Cruise, a new festival at EPCOT, and the Monorail Food Tour is not an accident. Attendance is dropping overall at the parks and they are trying to keep their revenue margin high by getting the people there to spend more money any way they can. There will be more and more and more special events to try and drive business. Is that necessarily bad? You make that call for yourself.

Just got back from WDW and it was packed the entire time we were there. I live in Socal and know all too well how bad DLR gets with the crowded walkways, WDW was almost as bad even though the parks are way bigger. Even the attractions that don't traditionally get really long queues were 60 for much of the time (Pirates, Mansion). Frozen was posted between 120-150, most of the major attractions were about 90, even the character meet & greets Adventures Outpost and Epcot Character Spot were posted at 60 and Ariel M&G at MK was posted at 45 when I walked by it at like 10pm. We went on Small World at 11pm and it still had a full queue.

 

Just seems kind of odd they are full on cost cutting and upcharge mode when the parks are still very busy. It would have been nice to have Stitch's Great Escape open, even though I wouldn't have ridden the park was so packed anything that could suck in crowds would be nice. It was also bizarre with no night parade when all the queues were still long at like 10-11pm. I know this is traditionally a slower time of year and have been to WDW and DLR on holidays when they are busier, but it definitely still felt very busy. My guess is that it has to do with the Rivers of Light miss at DAK this summer, the park was still open late with nothing really new to keep people there resulting in nighttime operation being a huge a waste of money (so far). Also Avatar probably being way over budget.

[DirkFunk]

Just got back from WDW and it was packed the entire time we were there. I live in Socal and know all too well how bad DLR gets with the crowded walkways, WDW was almost as bad even though the parks are way bigger. Even the attractions that don't traditionally get really long queues were 60 for much of the time (Pirates, Mansion). Frozen was posted between 120-150, most of the major attractions were about 90, even the character meet & greets Adventures Outpost and Epcot Character Spot were posted at 60 and Ariel M&G at MK was posted at 45 when I walked by it at like 10pm. We went on Small World at 11pm and it still had a full queue.

 

Magic Kingdom is doing generally fine, but when you're getting 20 million people through the turnstiles, a 5% decrease may not be immediately noticeable to you, but certain is to the folks who run Parks and Resorts. Their spiffed up version of the numbers for Q4 of the last fiscal year was a 4% "shifted" drop and 10% actual dip in attendance. In order to keep growth margins above 5%, how do you do that when people aren't going? You get the ones that do to spend more via increased hotel/ticket/food pricing and creating additional upcharges.

 

Also - is a park like Studios still busy? Yeah. Any park that consists of 3-4 shows and 5 rides and has >5 million people going to it is going to be busy. Half the park is walled off. If 30,000 people show up, there's only so many places for them to go right now.

 

Just seems kind of odd they are full on cost cutting and upcharge mode when the parks are still very busy. It would have been nice to have Stitch's Great Escape open, even though I wouldn't have ridden the park was so packed anything that could suck in crowds would be nice. It was also bizarre with no night parade when all the queues were still long at like 10-11pm. I know this is traditionally a slower time of year and have been to WDW and DLR on holidays when they are busier, but it definitely still felt very busy. My guess is that it has to do with the Rivers of Light miss at DAK this summer, the park was still open late with nothing really new to keep people there resulting in nighttime operation being a huge a waste of money (so far). Also Avatar probably being way over budget.

 

People love scapegoats and they'll try to blame something. Listen: Eternal attendance growth that keeps profit above the margin for inflation is not realistically possible. There is a point where even Disney World will arrive at in which everyone in the market for their product already buys it. They might have gotten to peak theme park! It might be that no giant spending on a new theme park will increase margins.

[Ape]

We are just doing one Saturday Feb 11th at Magic Kingdom before our cruise the next day. I am hoping it is not crowded but for some reason I have always had this fear that the park is always shoulder to shoulder and I do not want to be involved in that.

[xstech25]

People love scapegoats and they'll try to blame something. Listen: Eternal attendance growth that keeps profit above the margin for inflation is not realistically possible. There is a point where even Disney World will arrive at in which everyone in the market for their product already buys it. They might have gotten to peak theme park! It might be that no giant spending on a new theme park will increase margins.

The population of Florida continues to grow very healthy and probably will for a long time, the world population continues to grow, emerging markets continue to grow (though the ones close to Florida, such as central America and Brazil, are in a big slump right now. They will recover eventually). It might not be worth it to build a new park right now but eventually it probably will be. I agree with you they should be cautious because what is the point they start cannibalizing their own business...but lets say in 2040 or something if they add another park and all 5 parks are busy all the time it would be hard to argue that they aren't making more money.

 

I think the big challenge WDW faces isn't economics, its keeping everything fresh and up to date when there is so much there. Of course that's a whole other discussion.

[Jew]

population growth =/= attendance growth

 

The simplified version of every theme park business model is this: no matter what, the cost of doing business will be high. You can fudge the numbers a little bit by closing some venues, but you're still looking at high costs to operate and maintain what you do have open. You can also only guarantee one revenue stream: admission tickets, which generally should cover your operating costs or come close to it. Food, merchandise, and premium products are how you make a profit. That is why parks will never stop introducing new products that don't come with high costs to them---front of line tickets, VIP tours, cabanas, hard ticket events, premium parking, different annual pass tiers, limited edition merchandise, seasonal food items/festivals, express buses, character dining, etc.

[jynx242]

We are just doing one Saturday Feb 11th at Magic Kingdom before our cruise the next day. I am hoping it is not crowded but for some reason I have always had this fear that the park is always shoulder to shoulder and I do not want to be involved in that.

 

I've found it always behooves me to just expect it to be super-busy (especially on a weekend,) and plan accordingly. With smart use of Fastpasses and a little forethought, you will still get to do just about everything you want to do. Remember, even when it is very busy - it is Disney World. You will still have a nice time!!

 

Have fun, and remember, you get to relax on a cruise after your Magic Kingdom day - what could be better??

[I Like Theme Parks.]

you get to relax on a cruise after your Magic Kingdom day - what could be better??

It could be better if somehow Knoebels was involved!

[jynx242]

^Everything is better with Knoebels

 

but cruises don't suck either

[Ape]

This day is mainly for my three year old. I am just hoping he gets to see and do the things he wants without obscene wait times.

[Hilltopper39]

This day is mainly for my three year old. I am just hoping he gets to see and do the things he wants without obscene wait times.

 

Don't forget to use Child Swap, it can really come in handy with little ones especially on attractions with longer waits like 7 Dwarfs Mine Train if you can't get a fastpass.

[DirkFunk]

People love scapegoats and they'll try to blame something. Listen: Eternal attendance growth that keeps profit above the margin for inflation is not realistically possible. There is a point where even Disney World will arrive at in which everyone in the market for their product already buys it. They might have gotten to peak theme park! It might be that no giant spending on a new theme park will increase margins.

The population of Florida continues to grow very healthy and probably will for a long time, the world population continues to grow, emerging markets continue to grow (though the ones close to Florida, such as central America and Brazil, are in a big slump right now. They will recover eventually). It might not be worth it to build a new park right now but eventually it probably will be. I agree with you they should be cautious because what is the point they start cannibalizing their own business...but lets say in 2040 or something if they add another park and all 5 parks are busy all the time it would be hard to argue that they aren't making more money.

 

I think the big challenge WDW faces isn't economics, its keeping everything fresh and up to date when there is so much there. Of course that's a whole other discussion.

 

It isn't hard to argue that they aren't making more money. It is actually very easy. Unless a 5th park has a substantial effect on the number of nights stayed on property and has a proportional increase in ticket price for multi-day/multi-park tickets, the actual revenue to Walt Disney World doesn't change so much. The expenses to obtain that revenue do, though.

 

Let's throw something else out there: regardless of how you feel about the TEA numbers, last year they looked like this:

 

MK: 20,492,000

EPCOT: 11,798,000

DAK: 10,922,000

DHS: 10,828,000

 

It doesn't take an MBA to realize that the bottom two parks at WDW basically equal the attendance of the first park. So let's be clear here about what the situation at WDW is. Magic Kingdom is the draw. The other three parks are really overflow/dining zones. If you manage to build something at one of those that greatly increases attendance, it probably comes with an increase of attendance at Magic Kingdom because everyone still wants to go there. MK can barely handle more people than it got in 2015. This is the inherent purpose behind MyMagic+: Spend money to bring up guest satisfaction without causing attendance to increase so dramatically that the infrastructure is no longer capable of supporting it. The Disney superfans will tell you that increasing capacity with more rides is the solution, but that does nothing for the basic infrastructure deficits with the capacity of the monorail or bus system.

[xstech25]

Some of what you said makes sense, but to say they are not going to try an increase attendance because MK can't handle any more is ridiculous. I don't know how you can say that when STAR WARS LAND IS BEING BUILT AT DISNEYLAND the biggest clusterf*ck of any theme park on the plant. Also to say that Mymagic+ was purposely created to minimize attendance increase (trying to say this as polite as possible) might be the most ridiculous thing i've ever read. Mymagic+ was added because in the digital age it's common sense to try and adapt to changing consumer trends. If your assumptions were true Bob Iger wouldn't have said that they are looking at adding more hotels at the earnings call. More hotels = they are expecting more people...regardless of length of stay.

 

Also regarding infrastructure to handle crowds, it seems to me what you are trying to say is that its not worth spending the money on things like the new hub, second ferry dock, and additional components at Soarin and and Toy Story Mania...they would make more money by just leaving them the way they are and not getting the higher attendance because it would keep their costs lower. MK just made a huge investment with New Fantasyland which ironically has an onimover, two Dumbos, and a dinkly little coaster that has an unload platform and runs like 4 trains. That's a huge investment in increased attraction capacity for the park. If the attendance increase warrants having another park eventually there will be another park regardless of its impact to MK you can count on that. It's called add more boats/buses/parking...it's what they've been doing for over 40 years when they expect attendance increases. It may not be for a few decades...but eventually it will get to that point.

 

Ironically I have an MBA and had to go through all those diminishing return case studies

[DirkFunk]

Some of what you said makes sense, but to say they are not going to try an increase attendance because MK can't handle any more is ridiculous. I don't know how you can say that when STAR WARS LAND IS BEING BUILT AT DISNEYLAND the biggest clusterf*ck of any theme park on the plant. Also to say that Mymagic+ was purposely created to minimize attendance increase (trying to say this as polite as possible) might be the most retarded thing i've ever read. Mymagic+ was added because in the digital age it's common sense to try and adapt to changing consumer trends. If your assumptions were true Bob Iger wouldn't have said that they are looking at adding more hotels at the earnings call. More hotels = they are expecting more people...regardless of length of stay.

 

I should start a Google Doc with links to all this stuff from the past so that I don't have to repeat it. Rasulo pretty much said this verbatim about why MyMagic+ was developed instead of several hundred million dollars in new rides 3-4 years ago. Disneyland isn't Disney World, and increasing resort revenue there is a whole different game. Meanwhile, at WDW, "More hotels" = more DVC best anyone can tell. DVC makes money even when no one stays in it due to yearly fees and initial buy. He might also be referring to Flamingo Crossing, which isn't exactly anything game changing.

 

Also regarding infrastructure to handle crowds, it seems to me what you are trying to say is that its not worth spending the money on things like the new hub, second ferry dock, and additional components at Soarin and and Toy Story Mania...they would make more money by just leaving them the way they are and not getting the higher attendance because it would keep their costs lower. MK just made a huge investment with New Fantasyland which ironically has an onimover, two Dumbos, and a dinkly little coaster that has an unload platform and runs like 4 trains. That's a huge investment in increased attraction capacity for the park.

 

Spending on infrastructure and capacity when the park is slammed with people is exactly the right thing to do. None of those things are "game changing" moves intended to push the needle significantly and alter the distribution of attendance. All of it combined is probably half the cost of MM+.

[thrillrider]

It looks like CNN is all over the cabana story now...

https://m.facebook.com/story.php?story_fbid=10208174676272623&id=1472998283

 

Not many (if any) positive reactions to it.

[coasterbill]

It looks like CNN is all over the cabana story now...

https://m.facebook.com/story.php?story_fbid=10208174676272623&id=1472998283

 

Not many (if any) positive reactions to it.

 

People just like to bitch. If a business comes up with something that can make them more money but at the same time have zero negative impact on people who don't pony up the cash for it then there's literally nothing to bitch about. It's a win win for everyone.

[Jew]

People like to bitch about nice things they can't afford is a more accurate way to describe it.

[gerstlaueringvar]

Those people are just dumb and they will probably never be able to afford one of these service.

[SharkTums]

We were talking about something similar to this recently. 95% of the people complaining about this probably don't even visit the park or intend to. People just feel they have the right to bitch loudly and online over EVERYTHING and it's really getting annoying. If you don't have anything nice to say, don't say anything at all!

 

And like others have said, this doesn't impact your day personally if you are actually at the park in ANY way so let it go!

[jray21]

Yeah, I don't understand all the complaining. If you have the money, great! If not, who cares!