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At $40,000, Disney World Vacations Drain Wallets of Die-Hards

Higher prices and growing complexity dim the Magic Kingdom’s allure

Walt Disney World in Orlando, Florida, US.Photographer: Brian Carlson/Bloomberg

Walt Disney World in Orlando, Florida, US.Photographer: Brian Carlson/Bloomberg

Walt Disney Co. raked in record theme-park revenue last year, boosted by a strategy that puts a price tag on everything from dinner with Cinderella and lightsaber workshops to skipping the line to join the Guardians of the Galaxy.

That tactic is now being challenged, as the era of free-spending revenge travel fades away and inflation pinches the pocketbooks of US families.

After a blowout 2022 driven by pent-up demand, visits to Florida’s Disney World are down as much as 15% this year, according to one analysis. As the House of Mouse pushes up against the limits of what vacationers are willing to pay, travel planners say families are often cutting trips short to cope with peak-season ticket prices that have almost doubled over the past decade.

On top of the surging admission prices, vacationers are balking at a system that’s has become so complex that the bewildered turn to a parallel economy of planning blogs, social media accounts and message boards, as well as Disney-affiliated travel agents, to help navigate it all.

Myriad add-ons that are now a standard part of most visits — Bibbidi Bobbidi Boutique princess makeovers or passes that let antsy kids skip lines — have boosted the cost for a typical, week-long trip for a family of four to $5,000 to $25,000, or as much as $40,000 for a top-end experience, according to travel agents.

 

Source: Bloomberg research, Walt Disney Co. Note: Budget is for 2 adults, 2 children. High-end prices are for peak-season Christmas week. Low-end are for August low-season. Skip-the-line prices are averages of Disney's dynamic pricing. High-end Genie+ and Lightning Lane passes are for five days. Sixth day VIP tour includes line-skipping. *Park hopper plus includes access to all theme and water parks, plus one add-on experience
Source: Bloomberg research, Walt Disney Co.
Note: Budget is for 2 adults, 2 children. High-end prices are for peak-season Christmas week.
Low-end are for August low-season. Skip-the-line prices are averages of Disney's dynamic pricing. High-end Genie+ and Lightning Lane passes are for five days.
Sixth day VIP tour includes line-skipping.
*Park hopper plus includes access to all theme and water parks, plus one add-on experience


 All told, Disney officials have indicated that visitors spend 40% more per day in US parks than they did pre-pandemic. The company's operating income from parks and experiences fell 13% last quarter, but was still 24% above where it was in 2019.

“Disney has done a lot to increase pricing and per-cap spending,” helping to blunt the effects of lower attendance, said Laura Martin, a media analyst at Needham & Co. who rates Disney stock a hold. “It’s a premium product, and it’s basically for rich people.”

While Disney doesn’t share specific numbers on park attendance, executives acknowledged on the most recent earnings call that the Florida resorts — which also include Animal Kingdom, Hollywood Studios and Epcot — were underperforming due to lower attendance and higher operating costs.

 

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Walt Disney World in Orlando, Florida on Feb. 8.Photographer: Joe Raedle/Getty Images


But that’s not stopping Disney from betting big on parks. The company said last month that it’s going to double investments to $60 billion over the next 10 years.

Disney acknowledges the complexity issue, and says it’s trying to tackle it.

“Everyone vacations differently, so we offer a wide range of options, including ways to save and find great value, all while continuing to roll out updates that make planning simpler and easier,” Avery Maehrer, Disney World’s communications director, said in an email.

And Disney isn’t the only park operator feeling the downturn in leisure spending. Comcast Corp. reported lower attendance at Universal Orlando this year and SeaWorld Entertainment Inc., which operates a site in Orlando, said that visits to its 12 parks were down 2% compared to last year.

But the situation at Disney World — far and away Disney’s most visited resort — comes during a difficult stretch for the company as Chief Executive Officer Bob Iger tries to reverse a slump in its movie business, losses in its streaming operations and struggles at its TV division. The stock has declined 60% since reaching a record high in March 2021.

Read more: Bob Iger’s Billion-Dollar Crisis Puts His Legacy on the Line

In Florida, the company has been feuding with Governor Ron DeSantis over his school policies, and other conservatives have called for boycotting Disney. While there’s no evidence the tension has had any impact on park attendance, it adds to the pressures on Disney’s Florida business

Disney Parks, Cruises Account for Nearly 30% of Revenue

2022 revenue sources for Walt Disney Co.

Source: Company filings Note: Segment figures do not add due to $2B reduction from content license early terminations and elimination of intrasegment revenue
Source: Company filings
Note: Segment figures do not add due to $2B reduction from content license early terminations and elimination of intrasegment revenue

 

Entrance to the flagship Magic Kingdom costs as much as $189, and accessing all four of Disney World’s Orlando parks in a single day reaches $252, about as much as a lift ticket at premier ski resorts like Aspen and Vail and in line with prices for parks run by Universal and SeaWorld.

That pricing is fairly straightforward. What’s now grating on travelers is the dizzying array of add-ons that Disney offers. That includes various skip-the-line passes with dynamic pricing, which Disney says about half of park-goers purchase, up to the top-of-the-line VIP tour, where a private guide escorts visitors to the front of lines and into exclusive areas at a cost of as much as $6,300 a day.

Other options include princess makeovers that go for as much as $230, build-your-own Star Wars lightsaber workshops for $250, dinners at Cinderella’s Royal Table for $79 a pop (excluding drinks) and an electronic wristband that stores tickets and unlocks hotel rooms, a convenience that costs as much as $46.

How Much Time Does the Lightning Lane Save?

Minutes saved using skip-the-line passes for five Magic Kingdom rides on a busy day

 

Source: Touringplans.com Note: Wait data is from Easter week, Tuesday, April 4, 2023. Assumes three rides reserved on Genie+ and the maximum two Lightning Lane purchases for four people. Assumes 7-minute wait in each Lightning Lane. Cost range reflects the dynamic pricing structure for Lightning Lane and posted $35 Genie+ pass price on April 4.
Source: Touringplans.com
Note: Wait data is from Easter week, Tuesday, April 4, 2023.
Assumes three rides reserved on Genie+ and the maximum two Lightning Lane purchases for four people.
Assumes 7-minute wait in each Lightning Lane.
Cost range reflects the dynamic pricing structure for Lightning Lane and posted $35 Genie+ pass price on April 4.


 

“The parks have become much more expensive with complexities,” said Len Testa, who runs the website Touring Plans, which harvested ride data to estimate that attendance is down by 15% this year. “The average guest is spending more, and cutting back the length of stay.”

Parents who thought simply buying an admissions ticket would guarantee them an easy day of fun with their kids may find themselves losing hours without those skip-the-line passes or find their kids disappointed they didn’t get to dine with Chef Mickey.
 

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Visitors arrive at Walt Disney World in 2022.Photographer: Brian Carlson/Bloomberg


“Not only is it confusing,” said Quincy Stanford, who writes for Disney vacation planning website AllEars.Net. But “now a lot of the things you’re confused about cost money.”

Some vacationers choose Disney Cruise Lines as an alternative, and even California’s Disneyland is considered much easier to handle.

It’s “a cakewalk in comparison,” said Abby Finkel, a Disney travel planner with Wave of a Wand Travel. She recommends clients take a trip out west if they’re too stressed by Disney World.

But even with the hurdles, Disney’s most loyal fans will do what it takes to make it to the Magic Kingdom, including taking on debt.

Eli Trowbridge, a 44-year-old father who works at a food distribution company in northwest Indiana, saved up for two years for his family’s Disney World vacation in 2019. As the trip approached, he realized his savings weren’t enough for the Disney experience of his dreams. So he borrowed an additional $5,000 from his 401(k) to pay for the trip for him, his wife, their four kids and his mother-in-law.

Trowbridge estimates that the experience set his family back $15,000 to $17,000. He knows that seems excessive to a lot of folks.

“Is it something that you value and is it worth it?” he said. “For some people it’s not. For us, it was.”

— With assistance by Dave Merrill and Felipe Marques

Author: Editors Desk

Source: Bloomberg

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