Mismanaging the Life Cycle of Disneyland as a Product and as a Business

[flynnibus]

Originally Posted by mousechild

Generally speaking on a per guest visit train stations are a low volume transaction system. Usually once per rider. If you spend a day in the park and go on 20 rides, you now have 20 transactions per guest.

So you don't think urban metro centers like New York City, London, Washington DC, can compare to the load of a DL? Please. 20 transactions per guest? Spread out over the entire day. Trains are actually MORE compressed due to rush hours, etc.

The New York regional transit has an *AVERAGE* of over 8 MILLION riders a day on a weekday. MILLION - not the 55,000 x your loftly 20 transactions.

Originally Posted by mousechild

Disney probably handles more daily ride transactions than the John Wayne airport and possibly more than LAX. And Disney is trying to have customer satisfaction rating far better than that of your local airport or train station.

LAX handles on the order of 5 MILLION passengers a month. DL can't even do that in 4 months. This number spread out on an average.. almost 10,000 people AN HOUR (30 days @ 18 hour operating days)

Originally Posted by mousechild

Imagine a high volume ride such as POTC. Now imagine that each rider has to insert a card of some type to enter the ride, line speed goes down, ridership goes down, line size goes up, customer satisfaction goes down.

You over estimate the transaction time required. Plus, as I stated, you don't do this at load.. you do it before load to buffer the line. You don't insert your card as you climb in the boat. The boats are still slower then the line - hence any variance in the line does not affect your total wait time.

Originally Posted by mousechild

And as of yet we have not talked about security, for counterfeiting, spoofing, and theft.

Wow - you mean like they have to do with tickets today? Fascinating...

Originally Posted by mousechild

Do you think the line to city hall is long now wait until guest start complaining about debit accounting.

Again - another model ALREADY PROVEN IN THE INDUSTRY - heck even at Disney! It's used in WDW and on cruise ships. Integrated charging on your room card.

Originally Posted by mousechild

i am not saying go to pay-to-play or don't go, but in this discussion lets at least examine the true cost both internally and externally of such a system.

Lets stop trying to point out challenges that have already been addressed and proven successful in the industry as show-stoppers.

[DCAFTW]

Originally Posted by flynnibus

Sorry - but the system is IN USE and WORKS already in other parks. Arguements like 'this can't possibly work' are already proven wrong.

The system displays for you how many points you have left when you scan. People keep track of it. The value Disney can offer that they can't today is that points can carry between visits, etc. Disney can upsell customers with 'point protection' where points bought today will be guaranteed to work in the future - protecting against cost inflation, etc.

Yup - but people are AWARE of the points because its something they pay alot for and they know its a deal-breaker for them. They MICRO-manage their points - they don't forget about them. And you play 'point check' terminals throughout the park allowing people to easily check their points with just a swipe or insert of the card.

I'm sorry, I've seen this in action in arcades, small parks, and ticket systems in parks, and people SO do not keep track of their points/tickets. It's always a mess especailly when you have a large family.

Again - they are systems PROVEN already. The benefits to guests are they can pay only for what they want... they can carry points... you don't pay high prices for people that don't ride (remember, grandma pays full price today.. regardless if she rides or not), and they get discounts with bulk purchases.

So then...grandma can stay in the hotel room...hahaha.

You mean.. like.. uhh.. fastpass? Or electronic gate media? Or biometrics? Sorry - doesn't hold any water.

*holds up cup of water*

Actually, those systems are just new technology, that basically facilitates the same task as the previous systems. They just slide the new tech in, and slide the old tech out, and requires no grooming of the general publics expectations. Most people don't even notice a difference.

With fast pass, it's an optional media. People don't need to use it, and they continue with their current behavior, if they do they take the time to learn it, and then take advantage of it. The sheer volume of people that don't use fastpass because they "don't understand it" should show that implementing a radically different system than the public is used to is very difficult. Imagine if everyone HAD to use fastpass, there would be pandemonium.

...and that's just the reaction from the guests. The logistics with installing the new technology, training the CMs, creating a body to account for all of the physical media as well as document the transactions of the data on the cards would be a huge undertaking.

[flynnibus]

Originally Posted by mousechild

Honestly I think there is very little chance Disney would change the pricing system. One reason that it would not happen is that such a structural change would have to be sold to Wall Street for a good long while before it could occur with the regulatory issues of today's environment.

HUH?

Exactly what 'regulation' do you think there is by the SEC in regards to how Disney charges for its products???

Originally Posted by mousechild

I imagine that if such a change was being contemplated that the board would have to reveal it in its regular SEC filings and the annual report.

Neither the SEC filings or Annual Reports have any requirements when it comes to guidance of revenue (they do require discussing risks tho). Why on earth do you possibly think such changes would have to be disclosed to investors as a requirement or law? That's absurd.

Such dramatic changes would probably have to be approved by the board due to the potential huge impact - but that's due to tradition oversight - nothing to do with regulations or laws. That's simple fearmongering.

Originally Posted by fo'c's'le swab

IMO, the AP system as it now stands is a monster that cannot be appeased or cajoled. Anything short of this 'unlimited access' is going to be perceived as a 'step backwards' for APers.

Yup - but sometimes love hurts. Endless price escalation with no measurable benefit to the AP holder is hard to swallow as well. And there are ways to start minimizing the APs today - limiting total sales, price adjustment, total visit limits, etc.

Originally Posted by DCAFTW

Now THIS, I would like.

I go a couple times a year, but definitely not enough to warrant the cost of an AP, especially considering the dates I would be likely able to go are usually blacked out of the cheapest option.

A non-expiring 15 day parkhopper would be GREAT.

Sure it would - but it would be the worst thing Disney could do because it gives you EXACTLY what you want. It totally removes the upsell from the ticket strategy. The point of the AP is not to be cheaper then buying 365 tickets - its to upsell your ticket spending with the added benefit to Disney that your return visits include more exposures (leading to more sales) and of course the spending you can't avoid (food, etc).

Why is the sale in the store 'buy 2 get one free'? Because they want you to spend 2 times priceX...not just give you 30% off priceX.

Upsell and get the consumer to spend more then they initially intended to.

[mousechild]

Originally Posted by flynnibus

So you don't think urban metro centers like New York City, London, Washington DC, can compare to the load of a DL? Please. 20 transactions per guest? Spread out over the entire day. Trains are actually MORE compressed due to rush hours, etc.

Perhaps I was unclear in my post I was looking at the system from the viewpoint of the user not the company. Do you really want to replicate the front gate experience 20 times in the park, or a train terminal experience 20 times a day?

[mousechild]

Exactly what 'regulation' do you think there is by the SEC in regards to how Disney charges for its products???



Neither the SEC filings or Annual Reports have any requirements when it comes to guidance of revenue (they do require discussing risks tho). Why on earth do you possibly think such changes would have to be disclosed to investors as a requirement or law? That's absurd.

Such dramatic changes would probably have to be approved by the board due to the potential huge impact - but that's due to tradition oversight - nothing to do with regulations or laws. That's simple fearmongering.

Never said the SEC would require them to but ask any financial analyst what happens if you change your revenue structure on the fly with no prior warning to investors, the stock usually tanks as institutional investors flee to avoid the disruption. One of the reasons every board traded company has endless meeting with institutional investors is to give them long term warning about structural changes so that they have confidence in the stability of the business model. Change the business model without warning and you destroy the investors confidence.

Pick up the WSJ or use any online service and look back at what happens to a company that has to suddenly announce a change in traditional performance, the stock tanks, at least temporarily. Given the historically high P/E ratios of todays stock market stability is king. And btw look what happens with regard to stockholder lawsuits if the board fails to inform in a timely manner.

All I have been saying is that the change to pay-to-play is much more complicated than you are making it out to be both from the corporate and the consumer sides.

[flynnibus]

Originally Posted by mousechild

Perhaps I was unclear in my post I was looking at the system from the viewpoint of the user not the company. Do you really want to replicate the front gate experience 20 times in the park, or a train terminal experience 20 times a day?

I scan a card every time I go through a doorway in my office - its not that big of a deal.

People who ride public transit are used to doing it every time they enter or exit stations.

People who visit other parks that use attraction tickets are used to not just giving someone ticket, but counting out and HOLDING the tickets they need until they are collected, etc.

Honestly - its not that big of a deal. It's not a foreign concept. People wear the dorky laynards all day long at Disney by choice... wearing one with a pass to scan isn't that big of a deal.

Make the media magnetic and all you do is 'tap and go' for an even easier, less mechancial interaction that is more wear-resistant (at the expense of more costly media).

[mousechild]

Okay lets agree to disagree and wait a few years and see if Disney changes the system or crumbles to the ground. You think the current system can easily be replaced with a more profitable pay-to-play system and I think they are going to stick with the one ticket buys all ride system because it seems to be working well for them. From what I could see the park last week the current system was working pretty well and their annual report seems to back that up.

[flynnibus]

Originally Posted by mousechild

Never said the SEC would require them to but ask any financial analyst what happens if you change your revenue structure on the fly with no prior warning to investors, the stock usually tanks as institutional investors flee to avoid the disruption.

Actually you did when you said "...with the regulatory issues of today's environment". What does 'regulatory issues' have to do with your explanation of investor confidence?

Originally Posted by mousechild

One of the reasons every board traded company has endless meeting with institutional investors is to give them long term warning about structural changes so that they have confidence in the stability of the business model. Change the business model without warning and you destroy the investors confidence.

Yet - what you originally wrote was
"I imagine that if such a change was being contemplated that the board would have to reveal it in its regular SEC filings and the annual report."

Regular SEC filings and annual reports are reports about PREVIOUS performance, not future (sans the normal stuff on officer actions, etc). What you said previously and in this post are complete opposites. Last time you claim 'regulatory issues' and reporting about PAST performance. Now you are talking about prepping investment bankers and industry analysts on future performance.

Originally Posted by mousechild

Pick up the WSJ or use any online service and look back at what happens to a company that has to suddenly announce a change in traditional performance, the stock tanks, at least temporarily.

Yes - because people didn't know. When you brief analysts you can't tell them your performance numbers - that's called insider information. The stock reacts when the news is published not because the board failed to brief people - its because they could NOT tell people and this is the first time people are told. Anaylsts get briefed on direction, moves, products, etc... but they don't get performance things prior to earnings releases - that the analysts have to interpret and predict on their own.

You are fearmongering again and mixing concepts. Companies brief analysts on strategic changes, and yes a radical revenue model change in the parks would certainly be a topic for discussion - because Disney would be SELLING the analysts and investment bankers (which is what you do.. ) on why this is a positive change. The reactions to strategic moves is completely different then 'change in traditional performance' aka earnings warnings or releases.

Originally Posted by mousechild

All I have been saying is that the change to pay-to-play is much more complicated than you are making it out to be both from the corporate and the consumer sides.

And again - nearly everything you have offered in justification is a mash-up of falsehoods and mixed up information.

I think pay-for-play is a miserable idea - but the reasons given on why it CAN'T be done here are really unfounded.

[DCAFTW]

I think we are really going to have to just agree to disagree here. I personally have very little faith in the general population to follow directions and change to a new set of rules. I think any change of this magnitude would turn into a complete mess of confusion, frustration, and chaos, and would result in a lot of guests being extremely upset.

Again, I think Disney would be more likely to rip out the castle and replace it with an interactive walkthrough of the lower intestine than go to a pay-for-play setup.

[mousechild]

I guess this transcript with all the forward looking statements and earnings guidance never occurred.

http://www.seekingalpha.com/article/...all-transcript

And I think almost all my statements were about why it would be costly and not worth the effort not that it wasn't possible. But as far as having to give fair warning any system that would degrade the value of what someone already has such as pre-purchased tickets and APs would have to be dealt with and that means a long warning period.

[The International]

Disneyland will never, ever switch back to pay-for-play. Ever. I am entirely confident, just like I'm confident that they will never add Dumbo to Space Mountain.

I love these threads because nobody ever really provides evidence that their fantasy pay-for-play system is better than the current system, nor is there ever any evidence to prove that APers are killing Disneyland, but still we're supposed to accept both of those concepts as fact just because.

There are a lot of things Disney *could* do to increase profits. Charge for bathrooms, charge for drinking fountains, make the parade cost extra, etc. They would never do those things because guests would hate them. This thread makes it sound like the average guest has just been brainwashed by pay-once admission and just doesn't know the glory of pay-for-play pricing which seems incredibly silly to me. Nobody likes pay-for-play pricing, nobody would accept it at Disneyland, and if implemented (which, of course, will never ever happen parkwide) it would make everyone's life a little more difficult just for an amount of money and efficiency that nobody in this thread can actually define.

[JiminyCricketFan]

I think you are right about how life-cycles are mismanaged. But ALL of the Disney resorts are suffering from this. WDW is the main resort suffering because there does not seem to be the understanding that reinvestment in improving the parks will bring more revenue.

The problem is compounded by executives who do not understand why Disneyland or any other Disney resort is popular. They seem to need to have constant polls to determine what is popular. They do not really understand what draws people to the park. Now the Imagineers DO seem to understand. But they don't seem to be the ones who make the decisions. They seem more the hired workers to create the "ideas" that the executives have. Take for example Pirate's Lair at Disneyland. Tom Sawyer island DID need a make over. However with all the new technologies that are available to today, that area could have been a "real-life" treasure hunt game that the whole family could have enjoyed. But the renovation was focused as a marketing tool for the last POTC movie. Now that the movie promotion is over, the island now seems forsaken by both guests and Disney management. No one is willing to come to terms with the fact that it is not attracting guest as they hoped it would. No one wants to "fix" the problem. IMHO, they spend too little, refurbished for the wrong reason, and did not respect the desires of Disney fans and guests who just feel unsatisfied.

Thanks for your post.

[PragmaticIdealist]

Originally Posted by sediment

A hybrid between the one-day passport and an annual passport looks like what? A five-day parkhopper with a longer effective period and more days? A once-a-month pass? Those sound extremely easy to implement, and I'd really like to see a five-day, non-expiring, parkhopper option.

A limited-use Passport that is attraction-admission-based could involve realigning queues, sometimes entrances AND exits and involve more CMs scanning cards. Not there is a problem with the latter, except for the current shortage of good CMs and the power those CMs would have and/or misuse. Creating self-scanning gates could do the trick.
Still, it disperses the revenue collection throughout the park, instead of concentrating it at the entrance gate. So, it's not "as simple" as you think to implement. Especially when the alternative is NOT to implement it.

To address the problems associated with the Annual Passport, Disney needs to persuade some existing holders to, instead, buy a subscription that allows them to purchase non-transferable One-Day Passports at a steep discount. In that way, some of the cost is upfront while the rest is tied to each visit. Most likely, the first visit would be included with the subscription.

To address the problems associated with the Unlimited-Use Passport, Disney needs to offer a Limited-Use Passport that provides admission to Disneyland and unlimited use of most Disneyland attractions. However, over-utilized attractions, those offering the FastPass service, would require a separate charge. While I believe Disney should eventually ascertain a way to eliminate the stand-by queues at these attractions, doing so is not essential. Guests would either place their Unlimited-Use or Limited-Use Passports into the existing FastPass dispensers in order to obtain FastPass tickets. The Unlimited-Use Guests would not be charged while the Limited-Use Guests would. Each Limited-Use Passport would be associated with an account that can be arranged in several ways. It can be tied to a credit card or a hotel room, or the account might contain credits that are debited with use. The credits would be purchased at the main-gate or at any of the various shops inside the parks. Disney might even package a block of credits with the Passports, themselves, in the same way that ticket books were originally included in the price of admission to Disneyland.

The threads I cited provide a more complete description.

[PragmaticIdealist]

Originally Posted by The International

Disneyland will never, ever switch back to pay-for-play. Ever. I am entirely confident, just like I'm confident that they will never add Dumbo to Space Mountain.

I love these threads because nobody ever really provides evidence that their fantasy pay-for-play system is better than the current system, nor is there ever any evidence to prove that APers are killing Disneyland, but still we're supposed to accept both of those concepts as fact just because.

There are a lot of things Disney *could* do to increase profits. Charge for bathrooms, charge for drinking fountains, make the parade cost extra, etc. They would never do those things because guests would hate them. This thread makes it sound like the average guest has just been brainwashed by pay-once admission and just doesn't know the glory of pay-for-play pricing which seems incredibly silly to me. Nobody likes pay-for-play pricing, nobody would accept it at Disneyland, and if implemented (which, of course, will never ever happen parkwide) it would make everyone's life a little more difficult just for an amount of money and efficiency that nobody in this thread can actually define.

Prior to the development of the FastPass service, Imagineering tested an electronic pay-for-play system with a fair degree of success. Cost was a factor, though, as were knee-jerk reactions like those that have been expressed in this discussion.

Tony Baxter, the new creative leader for Disneyland, certainly appreciates the need for pay-for-play, so don't be surprised if you see it return as an option in the future, especially because the cost-benefit analysis has changed and because Burbank now has wiser leadership.

[DCAFTW]

Originally Posted by PragmaticIdealist

To address the problems associated with the Annual Passport, Disney needs to persuade some existing holders to, instead, buy a subscription that allows them to purchase non-transferable One-Day Passports at a steep discount. In that way, some of the cost is upfront while the rest is tied to each visit. Most likely, the first visit would be included with the subscription.

To address the problems associated with the Unlimited-Use Passport, Disney needs to offer a Limited-Use Passport that provides admission to Disneyland and unlimited use of most Disneyland attractions. However, over-utilized attractions, those offering the FastPass service, would require a separate charge. While I believe Disney should eventually ascertain a way to eliminate the stand-by queues at these attractions, doing so is not essential. Guests would either place their Unlimited-Use or Limited-Use Passports into the existing FastPass dispensers in order to obtain FastPass tickets. The Unlimited-Use Guests would not be charged while the Limited-Use Guests would. Each Limited-Use Passport would be associated with an account that can be arranged in several ways. It can be tied to a credit card or a hotel room, or the account might contain credits that are debited with use. The credits would be purchased at the main-gate or at any of the various shops inside the parks. Disney might even package a block of credits with the Passports, themselves, in the same way that ticket books were originally included in the price of admission to Disneyland.

The threads I cited provide a more complete description.

Sounds horrific...I'm glad that this would never happen in a million years...LOL.