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  1. #1

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    Disney exec offers details on plans for future growth (02/26/2007)

    Jay Rasulo, chairman of Walt Disney Parks & Resorts, told investors at a recent analyst conference that Disney has a plan for "strong, continued growth over the next decade and beyond," not only from Disney's existing businesses, but also from "new geographies and new businesses."

    "We have only scratched the surface of the worldwide travel market," Rasulo said.

    Intent on "broadening our footprint," Rasulo said, Disney is looking at a number of options that depart from past practices, including putting Disney attractions in many places where they have not existed before, such as "resort hotels, RD&E centers or water parks," he said.

    Disney's plans include expanding its Grand Collection of Hotels in a variety of ways, including regional resort properties outside of metropolitan areas, urban hotels, resorts in exotic destinations and boutique hotels.

    The company also plans to expand its retail, dining and entertainment complexes.

    In addition, the company wants to expand its theme parks in a different way than in the past, Rasulo said, noting that "not all parks have to be the size of our current parks. ..."

    He added that Disney is contemplating a "smaller, deeply immersive park -- for now I'll call it a 'niche' park -- that could serve a much smaller daily audience in a more intimate setting."

    To contact the reporter who wrote this article, send e-mail to David Cogswell at [email protected].


  2. #2

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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    Just wanted to add that the Wall Street Journal had a major interview with JR a few weeks ago where he said many of the same things.

    Obviously, we know Disney is expanding its DCL and DVC businesses, but many of the other ideas are still blue sky.

    I could be wrong, but at this point I don't see Disney-branded hotels all over the world. I'm not sure they'd be the success everyone thinks they'd be ... unless, of course, you were going to say ... greatly increase your Adventures by Disney tour operations to the point where you could guarantee a certain number of rooms to be filled nightly.

    And as for the smaller, regional parks, well ... those have been tossed around for a long, long time. I know Disney is thinking heavily of that direction for places like China, India and Singapore. Whether they happen, we'll have to wait and see.

  3. #3

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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    I tend to agree that branded hotels would not work out very well. I feel that they might be in the the same vein as themed restaurants and look at how quickly that "trend" crashed and burned. If Disney should attempt this, as a shareholder I would want a "test" hotel done first before heavily investing in the idea.
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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    Great ideas and all...........but I really wish they'd fix Tomorrowland first....

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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    The problem that I have with Disney resorts away from the parks is primarily the cost. Disney always charges a premium for anything they sell, especially hotel rooms in Orlando and Anaheim. But since park visitors are held captive financially, they can get away with it. Sure, you can stay off-property, but the perks that come with a Disney resort justify the higher price for many travelers.

    So... what kind of perks will Disney provide for these new non-park resorts, in order to justify the exorbitant cost? If Disney were to build one of these boutique hotels in midtown Manhattan, what will I get for my $400 per night room? Swimming pool? Hardly. Room service round the clock? I can't even get that at existing Disney resorts now. Priority seating for Disney shows? Only if I stay on the Concierge floor for $600 per night. Then, what's the point? I'd rather stay at the Courtyard for half as much and parlay my savings into more shows or shopping, etc.

    I just don't see what Disney could do better for more money compared to the established hotels already in place, no matter where they're located. And if those new resorts are within affordable traveling distance to Orlando or Anaheim, it will cannibalize the existing resorts' attendance.

    Rasulo is coming into this game way too late. Parks and Resorts should have expanded right after 9/11 when the travel slump made resort and hotel acquisition and refurbishment more fiscally prudent.
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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    One good thing to come from this thinking is that Parks and Resorts appears to be distancing itself, now, from Paul Pressler's plant-the-flag strategy that would have put castles on every street corner around the world. Doing so would have definitely cannibalized Disney's existing business.

    The strategy to invest in new concepts is the right one, but the problem is that the creative resources aren't there to devise concepts that will find success. Rasulo has already made some serious strategic mistakes with the design of Adventures by Disney, and all of these other potential initiatives are questionable, as well.

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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    Quote Originally Posted by BlueSkyDriveBy View Post
    The problem that I have with Disney resorts away from the parks is primarily the cost. Disney always charges a premium for anything they sell, especially hotel rooms in Orlando and Anaheim. But since park visitors are held captive financially, they can get away with it. Sure, you can stay off-property, but the perks that come with a Disney resort justify the higher price for many travelers.

    So... what kind of perks will Disney provide for these new non-park resorts, in order to justify the exorbitant cost? If Disney were to build one of these boutique hotels in midtown Manhattan, what will I get for my $400 per night room? Swimming pool? Hardly. Room service round the clock? I can't even get that at existing Disney resorts now. Priority seating for Disney shows? Only if I stay on the Concierge floor for $600 per night. Then, what's the point? I'd rather stay at the Courtyard for half as much and parlay my savings into more shows or shopping, etc.

    I just don't see what Disney could do better for more money compared to the established hotels already in place, no matter where they're located. And if those new resorts are within affordable traveling distance to Orlando or Anaheim, it will cannibalize the existing resorts' attendance.

    Rasulo is coming into this game way too late. Parks and Resorts should have expanded right after 9/11 when the travel slump made resort and hotel acquisition and refurbishment more fiscally prudent.
    My thoughts exactly. I'm willing to spend more money on a Disney hotel when I go to Disney World because of the perks and the overall atmosphere of the whole destination. They're clearly talking upscale here and I can't see the sort of benefits they can offer in, say, Chicago, New York, or San Francisco, that they offer at their resorts.

    That said, I would love to see them build a water park near here. There's not really a decent one in Tucson or Phoenix, and if they built a Blizzard Beach type park in Phoenix, I'd make the drive to go there.

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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    http://www.latimes.com/news/printedi...iewed-homepage

    This link is a good story on the perils of overleveraging famous brands.

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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    Trader Joe's is a great company, and I'd add Chipotle to the list of businesses that knows what it is doing as it expands its chain.

    When The Disney Stores first started, the company made each one reflect the local culture in some way. So, the dioramas featuring Mickey and the gang were customized for the Glendale Galleria and for Pier 39. And, naturally, the overexpansion of that chain was partly responsible for its eventual downfall.

    When Steve Burke was replaced by Paul Pressler, The Disney Stores started losing their appeal. Burke was running the chain very well, and Disney was exceptionally careful in the beginning.

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    Re: Disney exec offers details on plans for future growth (02/26/2007)

    My guess is that this is an extension of the DVC/Resort hotel like at Hilton Head, SC.

    Basically, nicely themed, but not overly so. and minimal Mickey. Also they'll be resort
    oriented, meaning they'll first start out in Hawaii, Jamaica, Mexico, etc. They'll also be
    priced to the upper (but not the top) range of the prices in the area.

    They might (maybe likely) have a DVC right alongside and definitely route the Adventures
    traffic through them.

    So unless someone decides that they want a flagship, I doubt that they'll start w/ NYC
    or SF.

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