Disney's Big Price for a Small, Small World - Motley Fool - 8/7/2006

[sir clinksalot]

http://www.fool.com/News/mft/2006/mf...gvisit=y&npu=y

Who does Mickey Mouse think he is? Over the weekend, Disney (NYSE: DIS) announced that it was inching its single-day ticket prices higher at Florida's Disney World, to $67 a pop for those 10 and older. Just eight months ago, that same ticket would run you $59.75, before a January hike upped the price to $63.

Annual price hikes are common at Disney, but two substantial upticks in one year that add up to a 12% cumulative increase? That's not exactly business as usual.

The timing also makes it peculiar. Last week found regional park operators Cedar Fair (NYSE: FUN) and Six Flags (NYSE: SIX) both failing to grow turnstile clicks early in the critical summer season. The news at Cedar Fair was particularly troublesome, since it had actually lowered single-day admission prices at some of its flagship properties.

High gasoline prices aren't helping, either. Wild weather swings -- where it's either too rainy or too hot to enjoy a day out at the park -- are only making things worse. Disney is apparently willing to march to the beat of a different drummer, but it has its reasons.

Disney isn't a slave to the single-day ticket like regional parks that rely on either season passes or one-day admissions to keep the turnstiles going. Disney is a resort destination where a family can spend well over a week and still leave stuff undone. In a move to encourage longer stays and keep guests from straying to rival parks in the area, Disney's pricing policy provides substantial discounts for longer stays. Yes, $67 for a single day is steep. However, if you buy a 7-day pass for $210, that comes out to just $30 a day. Leaving so soon? For just $6 more you can buy a 10-day pass for $216, or just $21.60 a day!

So take a step back and analyze what is really going on. The price hike may seem dissuasive, but it is actually there to make you a more lucrative visitor by nudging you to choose what appears to be the more economical option. Naturally, Disney won't mind if you fork over $67 to enjoy a day at any of its four Florida parks, but it just wants you to stick around as long as possible.

Mickey kind of likes you.

Disney is an active recommendation for Motley Fool Stock Advisor newsletter service subscribers. Cedar Fair is an Income Investor selection.

Longtime Fool contributor Rick Munarriz is still a kid at heart, smitten over the right kind of animation. He owns shares in Disney and units in Cedar Fair. The Fool has a disclosure policy. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

[Thempark78]

Disney needs to realize that they make more money inside of their parks then they do off ticket prices alone. I understand to keep the prices elevated but not at the rate they have them. I would say $52.00 for a one day instead of $67.00. Also remember you have to pay an additional $40.00 to hop around from park to park. So in reality they are actually charging over $100.00 per ticket if you are just coming in for the day and might want to go to another park. This isn't fair for those who are only in the area for a few days. If we are paying these prices, what makes Disney so sure that we will return on a vacation with our families?

[tahoebob54]

Originally Posted by Thempark78

Disney needs to realize that they make more money inside of their parks then they do off ticket prices alone.

They realize how much money everyone spende and where they spend it at.

Originally Posted by Thempark78

If we are paying these prices, what makes Disney so sure that we will return on a vacation with our families?

I am quite shure that disney has done studies on how many familys will return return even with a higher one day ticket price.

[sediment]

As the Motley Fool article states, the one-day ticket prices are there mostly so people can determine, based on their math abilities, how much cheaper per day it would be simply to buy a 5-day thru 10-day passes. And, in the process, NOT go to Universal or Sea World or Busch Gardens.
I'm guessing about 2% of admissions are one-day tickets, if that.