Have Disney’s theme parks become playgrounds for the rich?
Disney introduced a demand-based pricing structure today, raising single-day admission prices for some holiday and summer weekend visits. The company has been raising admission prices every year, leading some to worry that it's pricing out middle class families.
Starting Sunday, admission prices to Disney theme parks will rise by up to 20 percent during holidays and some weekends – the most crowded times for the parks.
In a new, though long anticipated, demand-based pricing structure announced Saturday, similar to what airlines and hotels use, the Walt Disney Company said it will charge higher prices for single-day tickets during peak visit times to the six parks of Walt Disney World in Florida and Disneyland in California.
With the new pricing scheme, Disney – which has seen profits nearly double at its parks and resorts over the past five years, to $2.6 billion in 2014 – will capitalize on customers willing and able to pay a premium for holiday access, while thinning out the unrelenting crowds.
“In addition to expanding our parks, we are adopting seasonal pricing on our one-day ticket to help better spread visitation throughout the year,” the company said in statement to The Washington Post. “Multiday tickets, annual passes and visiting during nonpeak periods also provide our guests with options and savings,” it said.
Visitation to the parks has been soaring. Disney’s financial report for the latest quarter, ending January 2, shows that US park attendance rose by a record-setting 10 percent from the same time the year before. The fourth quarter 2014 attendance was already 7 percent higher than the same period in 2013, The New York Times reported.
To put that into context, the company’s most popular attraction, Magic Kingdom, recorded 19 million visitors last year, which is nearly equal to the population of New York state, as The Washington Post points out.
Visitation has not been affected by rising entrance fees, which in the case of Disney World, have been climbing every year since the park first opened in 1971. The adult admission price to Magic Kingdom, for example, in 1971 was $20.46 in 2014 dollars. Today that price is five times higher, with the cheapest, single-day ticket costing $105.
The continued hikes are leading some people to question whether “most magical place on Earth” is falling out of reach for most families.
“If Walt [Disney] were alive today, he would probably be uncomfortable with the prices they’re charging right now,” Scott Smith, an assistant professor of hospitality at the University of South Carolina whose first job was as a cast member in Disney’s Haunted Mansion, told the Post.
“They’ve priced middle-class families out,” he said.
The company points out that it is expanding attractions and VIP vacation packages – such as a new “Frozen”-themed attraction at Epcot and a major “Avatar”-themed area at the Animal Kingdom park – but as the Post has reported, many expansions seem to target the wealthy.
But much of the recent innovation in the theme-park industry, experts said, has gone toward retooling it as a playground for the rich and their kids. The industry has increasingly “stratified its offerings,” said [Scott] Sanders, Disney’s former pricing executive, by offering more to attract visitors like “the ‘Wall Street dads,’ who have the obligation to bring the kids to Disney but want to do it as quickly as they can and are least sensitive to pricing of anyone.”
At the company’s Disneyland and California Adventure parks in Anaheim, Calif., Bloomberg reports, “regular” single-day adult tickets, for most weekends and many weeks during summer, today will rise to $105 from $99. “Peak” day tickets, during holidays and July weekends, will cost $119. And the “value” ticket will drop to $95 from $99. Value tickets, mostly weekdays when school is in session, will account for 83 days this year.
In Orlando, Fla., the popular Magic Kingdom will charge $124 a day for peak periods, up from $105. Epcot, Hollywood Studios, and Animal Kingdom resorts will charge $114 on peak days, up from $97. The four parks will not change prices for value days, currently at $105 per ticket.
Prices are expected to continue to rise as long as demand grows, experts say. In fact, they’ll help the company control ballooning crowds and excessive lines by weeding out parkgoers who can’t afford growing entry fees.
“Disney’s made a strategic decision that they’re not going to discount to hold onto people at the middle part of the economy,” Robert Niles, editor of industry blog Theme Park Insider, told the Post. “They’re going to set their prices at the top 10 percent of family incomes and make their money where the money is.”