Do You think DISNEY has gone down hlll the last few years?

[KellyNY]

Interesting. Although these numbers don't really mean anything without something to compare them to. As I've said in the past, Disney does not exist in a vacuum. They aren't out there all on their own, and so you have to compare them to something to know whether they're outrageous or staggering or right in line or whatever.

The change in prices (on average for all the resorts you listed) in the 18 years from 1994 to 2012 at Disney is about 81%. Or about 4.5% per year.

What's the change at other local hotels / resorts during that timeframe? (That's still a little bit wonky, since Disney added a lot to its parks and resorts in the past 18 years, and some of those increases are directly related to additions or improvements in the parks, but it's still a relatively apples comparison.) It's tough to relate it to Universal hotels or SeaWorld hotels -- since Portofino et. al. haven't been open as long and SeaWorld doesn't have any branded hotels -- but I'm sure there's an average hotel rate on record somewhere for Orlando that can be compared.

I'm not looking at exact RATE so much, since whether Grand Floridian is worth $405 or whatever is very subjective. But if the percent of increase in the central Florida market as a whole has gone up 4.5% per year on average, then Disney's increase isn't staggering at all. If Orlando as a whole went up 1% on average, then it might be.

I can give some numbers.

Radisson Celebration, 2002 $69 in May
2011 $79 in May

It is about 1.6% average a year.

 

[KellyNY]

And again... the very fact that these rates still surpass those of Waldorf, AND occupancy rates remain strong at Disney hotels (as others have cited in this thread) IS proof in-and-of-itself that the value is still there at those prices for enough Disney customers.

If we will compare Waldorf then we need numbers for Disney deluxes and we do not have them. What someone posted is an average for all Disney hotels. Also last 2 years(not this year, I was not following much, so I do not know for sure), value resorts were overbooked at times, meaning there is 100% there, at least during fd. So, that gives much less number for moderates and deluxes, so how strong occupancy for deluxes is a question we do not know answer to and what you present as a proof is just your opinion based on no numbers.

 

[KSDisneyDad]

I can give some numbers.

Radisson Celebration, 2002 $69 in May
2011 $79 in May

It is about 1.6% average a year.

The most we ever paid for a Disney value resort was in October 2000 as I could not find any room discounts for that trip. We have since visited the All-Stars/Pop Century numerous times and with the abundant discounts and have paid the same or less than we did in 2000. Our most recent visit was August 2009.

Anecdotally, we can always find an example to fit our argument. But without seeing the actual numbers, we have no way to tell what people really pay on average because of the abundance of discounts, etc. both on-site and off-site. Rack rates don't tell us how much they really charge for a room on average.

The pricing comes down to supply and demand. What are people willing to spend and do they find it to be a value?

I like the local competition, but if Disney is raising prices higher than the off-site resorts, that only means that they are still satisfied with their demand and profitability that they don't mind losing some guests to the off-site resorts. If their occupancy fell below where they are comfortable, we'd see some more significant price adjustments IMO.

One could argue that if Disney resort prices are going up, that is proof positive that the popularity of Disney is higher than ever and thus, Disney is definitely not going downhill. Another person could argue that the higher prices is just price gouging and they are cutting services, not doing rehabs quickly enough, etc. so they see Disney going downhill. Again, we have no agreement, but it has filled a couple of pages though.

 

[MickeyMinnieMom]

Anecdotally, we can always find an example to fit our argument. But without seeing the actual numbers, we have no way to tell what people really pay on average because of the abundance of discounts, etc. both on-site and off-site. Rack rates don't tell us how much they really charge for a room on average.

The pricing comes down to supply and demand. What are people willing to spend and do they find it to be a value?

Best substitute data available for OVERALL perception (and thus reality in this case) of VALUE by many Disney customers is: ATTENDANCE DATA and $$/CUSTOMER taken TOGETHER.

It's an analytical question -- the two metrics I cite above are those that professional analysts will use to rough-gauge perceived value of the overall parks offering over time. This is why this info is in the 10-K. Not COMPLETE, but the best we can do as a quick-gauge and without proprietary / confidential marketing survey data, etc.

All of this picking out one rate at one point in time and a single rate at another point in time and comparing them is analytically insignificant and contains no real information. Again -- sharing my professional opinion as an analyst. Not a personal opinion as some continue to insist for some reason.

 

[KellyNY]

Best substitute data available for OVERALL perception (and thus reality in this case) of VALUE by many Disney customers is: ATTENDANCE DATA and $$/CUSTOMER taken TOGETHER.

It's an analytical question -- the two metrics I cite above are those that professional analysts will use to rough-gauge perceived value of the overall parks offering over time. This is why this info is in the 10-K. Not COMPLETE, but the best we can do as a quick-gauge and without proprietary / confidential marketing survey data, etc.

All of this picking out one rate at one point in time and a single rate at another point in time and comparing them is analytically insignificant and contains no real information. Again -- sharing my professional opinion as an analyst. Not a personal opinion as some continue to insist for some reason.

Isn't atendance data show parks attendance and not hotel occupancy?
BTW, occupancy is lower now then it used to be, so with attendance up and hotel occupancy down, can we conclude that Disney lost some customers to off site? Wonder what was the reason?

 

[flicx]

All of this picking out one rate at one point in time and a single rate at another point in time and comparing them is analytically insignificant and contains no real information.

How does comparing rack rates over the decades at disney and other area resorts contain no real information? I believe it shows mathematically what percentage the cost has increased.These are real numbers not made up.Some try the lame arguement that few pay rack rate,that again is a bad arguement,when disney offers a discount it is a percentage off rack rate.Thus the increase in rack rate is very important! Also making a comparison with another major next door theme park(universal) is a very valid thing to do.Getting a grasp on price hikes and comparing them with the current state of disney is pertinent to the discussion of whether or not disney is going downhill.

 

[MickeyMinnieMom]

Isn't atendance data show parks attendance and not hotel occupancy?

Yes. Occupancy is a separate stat -- couldn't hurt to include that in the mix as well, and look at three major stats total: ATTENDANCE, $$/CUSTOMER, OCCUPANCY RATE.

But really, if what we are analyzing is the overall Disney vacation -- i.e. has Disney's Parks offering gone downhill in the view of most consumers -- then the most relevant pieces of data are really $$/customer and attendance. If they stay onsite, the $$/customer goes up; if they stay in a deluxe, it goes up more than if they stay in a value. In other words, hotel stays are captured in some important respect in the $$/customer figure.

If the goal is to analyze how competitive a Disney deluxe is with, say, Waldorf, then what you would actually need is average cost of a stay along with occupancy rates. This would REQUIRE information that we CANNOT HAVE. The average rates are a blend of all the various discounts and those who pay rack -- we can't know that without inside information. However, note that this DOES NOT capture the VALUE of the WHOLE Disney vacation. Consumers decide how to spend their total pot of Disney vacation money: % to hotel, % on food, % on parks merchandise, etc. They might dial hotel back if they want to splurge on food. They might dial merchandise back if they want to stay longer or splurge on accommodations. The figure that grabs ALL of this spending is the $$/customer. Take that together with attendance, and you have a proxy for the "VALUE" of the Disney offering.

If $$/customer was sky-high and attendance was way down, consumers - on net - don't think the value is there for the money. If attendance holds firm in a bad economy, AND $$/customer goes up, then this is a sign that consumers, on average, DO see the value. I.e. this is not an SBU in decline according to the stats... at least not yet...

 

[MickeyMinnieMom]

How does comparing rack rates over the decades at disney and other area resorts contain no real information? I believe it shows mathematically what percentage the cost has increased.These are real numbers not made up.Some try the lame arguement that few pay rack rate,that again is a bad arguement,when disney offers a discount it is a percentage off rack rate.Thus the increase in rack rate is very important! Also making a comparison with another major next door theme park(universal) is a very valid thing to do.Getting a grasp on price hikes and comparing them with the current state of disney is pertinent to the discussion of whether or not disney is going downhill.

I think I captured the answer to this in my last post above (wrote it before I saw this post of yours, flicx).

You are only capturing one side of the equation: price increase. The real question is whether consumers are willing to pay that increased price -- that's what determines whether there continues to be value for the money in a Disney vacation -- demand at current prices.

I mentioned before that historically, Disney customers tend to be extremely loyal -- there is tremendous price inelasticity of demand -- i.e. consumers are willing to bear fairly large increases in price because they view the product (a magical experience) to be extremely unique and thus valuable (as compared with widgets, for instance that have exact substitutes).

With respect to comparables / substitutes... my 2 cents... Universal is comparable in that they are a theme park. They are closer to a Disney product than, say, Six Flags, but they aren't Disney. Again - take it for what it's worth, but I say this after studying Disney Parks SBU and its competition for an entire semester and writing that big 240-page paper (that I got an A+ on ... and in a top business program and finance masters program that I got a 4.0 final average GPA in... and graduated 1st in the class... so I'm not exactly an idiot... is there a "tooting your own horn smiley??) ). I know... it absolutely doesn't mean that I'm right, but it does mean that I combed through A LOT of data, etc. in making these conclusions. And FYI, so have many other marketing and business experts over the years. Disney isn't a model for nothing!

 

[KellyNY]

Yes. Occupancy is a separate stat -- couldn't hurt to include that in the mix as well, and look at three major stats total: ATTENDANCE, $$/CUSTOMER, OCCUPANCY RATE.

But really, if what we are analyzing is the overall Disney vacation -- i.e. has Disney's Parks offering gone downhill in the view of most consumers -- then the most relevant pieces of data are really $$/customer and attendance. If they stay onsite, the $$/customer goes up; if they stay in a deluxe, it goes up more than if they stay in a value. In other words, hotel stays are captured in some important respect in the $$/customer figure.

If the goal is to analyze how competitive a Disney deluxe is with, say, Waldorf, then what you would actually need is average cost of a stay along with occupancy rates. This would REQUIRE information that we CANNOT HAVE. The average rates are a blend of all the various discounts and those who pay rack -- we can't know that without inside information. However, note that this DOES NOT capture the VALUE of the WHOLE Disney vacation. Consumers decide how to spend their total pot of Disney vacation money: % to hotel, % on food, % on parks merchandise, etc. They might dial hotel back if they want to splurge on food. They might dial merchandise back if they want to stay longer or splurge on accommodations. The figure that grabs ALL of this spending is the $$/customer. Take that together with attendance, and you have a proxy for the "VALUE" of the Disney offering.

If $$/customer was sky-high and attendance was way down, consumers - on net - don't think the value is there for the money. If attendance holds firm in a bad economy, AND $$/customer goes up, then this is a sign that consumers, on average, DO see the value. I.e. this is not an SBU in decline according to the stats... at least not yet...

If they stayed on site, if they stayed at deluxe..., lots of IFs in my opinion. Lets look on what is actually there. Spending number is per room, meaning they count onsite guests, meaning onsite pay more now even with deep discounts, which pretty much show that rack rate does matter in our calculations as Flicx pointed out as final price comes out from % from Rack Rate, meaning with occupancy down and attendance up, some people already went off site, therefore less people see value in onsite resorts, or more people learned how to use calculators. So when we speak of attendance up, we really talking about parks, and if you want to speak of overal experience you cannot rule out hotels. Sorry but if we want to use numbers we have to use all available numbers not just those that fit the point.

 

[MickeyMinnieMom]

If they stayed on site, if they stayed at deluxe..., lots of IFs in my opinion. Lets look on what is actually there. Spending number is per room, meaning they count onsite guests, meaning onsite pay more now even with deep discounts, which pretty much show that rack rate does matter in our calculations as Flicx pointed out as final price comes out from % from Rack Rate, meaning with occupancy down and attendance up, some people already went off site, therefore less people see value in onsite resorts, or more people learned how to use calculators. So when we speak of attendance up, we really talking about parks, and if you want to speak of overal experience you cannot rule out hotels. Sorry but if we want to use numbers we have to use all available numbers not just those that fit the point.

I get what you're saying. I think the whole rack rate vs. real avg. rate is actually not that important. Rack as a proxy for real rate is not great, but it can give an upper bound. The real point is that the issue is whether guests are proving willing to pay it.

And I'm not just picking the data that fits my point. Let's look at this sample (thanks KSDisneyDad!)... my interpretation below of each stat over time... the type of thing I'd do in a quick analytical snapshot (for what it's worth! ):

Disney Domestic Hotel Occupancy by Year:
2005: 83%
2006: 87% (86% for WDW)
2007: 89%
2008: 89% (90% for WDW)
2009: 87%
2010: 82% (no WDW breakout)
2011: 82%

A few things stand out...
- Occupancy down since onset on recession, but stabilizing 2010-2011
- Note that Disney has been adding new DVC resorts in recent years... those new rooms are now included in the total... so this will initially drag % occupancy down, by definition (they build these to meet current demand and to meet projected increases in demand... which haven't happened yet given the economy and limited time)
- Even with new room stock and a bad economy, occupancy only down 7% from 2007-2008 high
-- TAKEN TOGETHER: nothing approaching a sign of decline at this point -- decreases explainable, and figures stabilizing


Domestic Per Room Spending by Year:
2005: $206 ($199 for WDW)
2006: $218 ($211 for WDW)
2007: $225 ($217 for WDW)
2008: $233 ($223 for WDW)
2009: $214 ($205 for WDW)
2010: $224 (no breakout for WDW)
2011: $246 YTD

A few things stand out...
- 3.0% CAGR 2005-2011; spending/room increased beyond inflation; taken with occupancy data suggests willingness to pay increases
- 9.8% increase 2010-2011YTD -- while % occupancy unchanged; solid evidence that value is there per customers -- the increases in prices are NOT driving them offsite or causing them to decrease hotel spending


Domestic attendance Increase/(Decrease) Percentages:
2005: 5%
2006: 5%
2007: 3% (6% for WDW)
2008: 2%
2009: 2% (flat for WDW)
2010: (1%)
2011: 1% for first nine-months

A few things stand out...
- Data suggest that attendance correlates with changes in economic environment
- Could argue that Disney is surpassing expectations based solely upon economic environment, as economy is stagnant while Disney is showing a 1% increase in attendance YTD


Domestic Park Spending Increase/(Decrease) Percentages:
2005: 5% (2% for WDW)
2006: 3% (1% for WDW)
2007: 3%
2008: 3%
2009: (6%) (down 4% for WDW)
2010: 3%
2011: 7% for first nine-months

- This speaks volumes. Same basic story about park spending decreasing as economic environment worsened. HOWEVER: there is a clear positive trend from 2009 through 2011YTD -- far surpassing any improvements in the larger economy
- This suggests value perceived by the average customer


Without posting Excel spreadsheets, graphs, and regression analyses... All taken together, along with the not insignificant fact that bottom line revenue is up in absolute terms, these data DO NOT suggest a Parks SBU in decline. And this doesn't cherry-pick one room rate here or there. You need to conduct this type of analysis with aggregate data -- not one-off figures.

Does that all make sense? Does it still seem to you that I am isolating my favorite data? I'm truly not.

Thanks for the discussion btw... fun for me to dust off some quick/rough Disney-data-analysis skills!

 

[KellyNY]

I think I captured the answer to this in my last post above (wrote it before I saw this post of yours, flicx).

You are only capturing one side of the equation: price increase. The real question is whether consumers are willing to pay that increased price -- that's what determines whether there continues to be value for the money in a Disney vacation -- demand at current prices.

I mentioned before that historically, Disney customers tend to be extremely loyal -- there is tremendous price inelasticity of demand -- i.e. consumers are willing to bear fairly large increases in price because they view the product (a magical experience) to be extremely unique and thus valuable (as compared with widgets, for instance that have exact substitutes).

With respect to comparables / substitutes... my 2 cents... Universal is comparable in that they are a theme park. They are closer to a Disney product than, say, Six Flags, but they aren't Disney. Again - take it for what it's worth, but I say this after studying Disney Parks SBU and its competition for an entire semester and writing that big 240-page paper (that I got an A+ on ... and in a top business program and finance masters program that I got a 4.0 final average GPA in... and graduated 1st in the class... so I'm not exactly an idiot... is there a "tooting your own horn smiley??) ). I know... it absolutely doesn't mean that I'm right, but it does mean that I combed through A LOT of data, etc. in making these conclusions. And FYI, so have many other marketing and business experts over the years. Disney isn't a model for nothing!

Glad disney doesn't see universal as six flags but as a competition. Many examples to that, DHS, AK, FA, AVATAR LAND.
So, you may not feel those parks comparable but disney does and therefore hotels are comparable as well even without being universal hotels.
sorry but we also not idiots and can draw conclusions from very simple numbers.

 

[topherSC]

Good Afternoon,

I have been reading this tread and listening to the arguments and I have a few quandaries.

1. prices of hotels also change as what they have to offer changes. (does each WDW Hotel not have WDW to offer and does that not change more and more every year.)
2. Disney wouldnt up there rates if people werent willing to pay for them.
3. we all have to remember that WDW is about a vacation not a hotel. When you are paying for a vacation there is going to be higher costs.
4. What monies does the average person say by staying there? (Car, Parking, Time, Headaches?) even the none tangible is worth money.

I dont think anyone is wrong I think we all have our opinions of things.

Here is my example. Local restaurant in town that I love has been amazing the last few times I have been there It was what I thought was bad food and bad wait staff. Well the last time I went it was perfect. Before the last time if you asked I would say the restaurant went down hill but instead now I say I had a few bad experiences.

We make what we want to out of our vacations. If you focus on price that tells me maybe you cant or shouldn't afford the trip.

We all have bad experiances everywhere and then the next time could be magical So has WDW gone down hill that is your own opinion. In mine I go back so I guess it hasnt.

JMHO

 

[MickeyMinnieMom]

Glad disney doesn't see universal as six flags but as a competition. Many examples to that, DHS, AK, FA, AVATAR LAND.
So, you may not feel those parks comparable but disney does and therefore hotels are comparable as well even without being universal hotels.

OK... they are competition in the sense that they all compete for tourism dollars in the state of FL. However, Disney offers a more robust, varied, and cross-marketed overall product (parks, hotels, merchandise, film, tv, etc.). Their cross-marketing, along with the Disney legacy and history create a unique product that people are buying: that magical experience... that thing that links them to their childhood filled with Disney memories of one type or another. Disney enjoys far more customer loyalty than these other entities as a result. Disney is the kind of thing that's passed down from generation to generation. In short, I'd be surprised if you find many Six Flag customers with a comparable experience. They do need to keep up with technology wrt rides (and the invest heavily here), and their hotels and other pieces of their offerings need to be roughly competitive with these other entities. BUT... when Disney puts all of these pieces together, the sum total is more than these others offer. Which is why they continue to be able to charge hefty premiums to these other offerings in many cases.

sorry but we also not idiots and can draw conclusions from very simple numbers.

I'm certainly not suggesting that ANYONE on here is an idiot!! I'm just giving you my little bone fides so that you can get a sense that I'm not an idiot! Data analysis is a skill, though. There are little tool kit things like CAGR, trendlines, competitive analysis, regression, correlation to economic indicators, etc. that analysts have a certain command of (hopefully!!) that most people don't come across in their day-to-day lives. Then there's the experience in pulling it all together to form an overall conclusion. And most people haven't spent months analyzing this stuff on Disney and its competitors. My only desire is to share what I know - for what it's worth.

I said many times that none of this means that I'm right; just that I am approaching it from a different angle, and pretty comprehensively. And NOT merely stating a personal opinion 'cause I like (or don't like) Disney these days. I think that my last post analyzing the trends briefly gets to this point.

 

[KellyNY]

Disney Domestic Hotel Occupancy by Year:
2005: 83%
2006: 87% (86% for WDW)
2007: 89%
2008: 89% (90% for WDW)
2009: 87%
2010: 82% (no WDW breakout)
2011: 82%

A few things stand out...
- Occupancy down since onset on recession, but stabilizing 2010-2011
- Note that Disney has been adding new DVC resorts in recent years... those new rooms are now included in the total... so this will initially drag % occupancy down, by definition (they build these to meet current demand and to meet projected increases in demand... which haven't happened yet given the economy and limited time)
- Even with new room stock and a bad economy, occupancy only down 7% from 2007-2008 high
-- TAKEN TOGETHER: nothing approaching a sign of decline at this point -- decreases explainable, and figures stabilizing

I do not know how many rooms were added, the only hotel rooms I can think of is new wing for CR and it does not make 7%. New value resort opens in May 2012, so we cannot count it yet.
So sugnificant or not, with increase of 1%, 7% down for hotels means something.
Yes, the remaining visitors do show they would pay a bit more which is evident from Spending/room but we cannot ignore what happen to those 7% and it does make me wonder what will happen when Disney will try to slowly get out of such deep discounts.
I am not suggesting btw that Disney gone downhill because of that. If you read all my posts (which I really not expecting you to do ), you will see that I do not think Disney gone downhill, but I see some not so good changes that make me feel like Disney is not on the top either. Price however is something that worries me as first, I do pay rack price for most of my vacations since I book less then a week in advance and second, because I see some not very good changes in onsite resorts, which makes me personally feel that I can bring my money offsite. While it is my personal opinion, there are people who feel same way and I believe some of them right in those 7%, which we cannot rule out.

BTW, what is wrong with board today? All your responces to my posts somehow appear before my posts and I keep missing them.

 

[DisneyFive]

Just thought I would throw a few more numbers into the mix.All the talk of hotel prices got me wondering,so I looked in my old birnbaum books and did some comparisons. I found the best available rack rates(regular view) in 1994, 2005 and 2012 just to demonstrate how fast these prices are escalating. So here goes, 1994 rates cont:190.00,poly:195.00,YC and BC:205.00,GF:245.00.Now 2005 rates cont:239.00,poly:299.00,YC and BC:289.00,GF:339.00.Finally 2012 rates cont:315.00,poly405.00,YC and BC:335.00,GF:460.00.I think they are kinda staggering.IMO

Just for reference, that isn't all that much more than plain 'ol inflation over the same period. (not that I'm a fan of resort prices going up)

From 1994 to 2012 (18 years), using your numbers, the average annual price increase for the resorts you list:

Contemporary: 2.8%
Polynesion: 4.1%
Beach Club: 2.8%
Grand Floridian: 3.6%

Inflation during that same period was 2.5%

Only the Poly and GF really outpaced inflation, not by leaps and bounds but still significant. The poly must be a VERY popular resort to command that type of annual price increase over the last 18 years though. That's impressive.

Dan

 

[KSDisneyDad]

How does comparing rack rates over the decades at disney and other area resorts contain no real information? I believe it shows mathematically what percentage the cost has increased.These are real numbers not made up.Some try the lame arguement that few pay rack rate,that again is a bad arguement,when disney offers a discount it is a percentage off rack rate.Thus the increase in rack rate is very important! Also making a comparison with another major next door theme park(universal) is a very valid thing to do.Getting a grasp on price hikes and comparing them with the current state of disney is pertinent to the discussion of whether or not disney is going downhill.

I have no idea why I'm biting, but oh well. Here it goes.

As I said earlier in this thread, I think using numbers is a red herring tactic as they can be used to make any point you want. What truly matters is how customers feel as to whether they spend $1,000 or $10,000 or even zero at the parks and resorts.

There is no overall empirical evidence in my opinion that says that Disney is declining. Calling arguments names such as "lame" doesn't change that fact.

For the sake of argument, let's say we want to resort to numbers to try to prove a point. Taking one piece of data (i.e. rack rates) is but one small component of the overall picture. First, rack rates going up doesn't mean customers are paying more. I think customers are paying more based on the spending per night figures that Disney publishes so there is some validity in rate increases. However, we have no idea how much exactly for each category of room. We just know that overall they are going up.

Occupancy has remained strong for Disney. It has gone down, but Disney even said that they are happy with higher rates per night and small declines in occupancy than they are with increased occupancy and lower rates per night.

Now that we agree that rates have gone up, what does that tell us. It's a matter of interpretation. If I understand you correctly, you have concluded that Disney quality has suffered and prices have gone up, so thus, Disney World overall has gone downhill. I understand this argument, but I do disagree with it. I don't believe that Disney quality has suffered like you have said. Quality is a subjective term and there is absolutely no way to get agreement on this issue. And a long thread with a miniscule percentage of the participants of a message board with less than 3% of the total Disney visitors on it is not a representative sample IMO that can make this conclusion.

I guess this is just a long-winded (and rambling) way to say that it's all just a matter of opinion. Doesn't mean that you're wrong. But it also doesn't mean you're right. JMHO

 

[KSDisneyDad]

I do not know how many rooms were added, the only hotel rooms I can think of is new wing for CR and it does not make 7%. New value resort opens in May 2012, so we cannot count it yet.
So sugnificant or not, with increase of 1%, 7% down for hotels means something.
Yes, the remaining visitors do show they would pay a bit more which is evident from Spending/room but we cannot ignore what happen to those 7% and it does make me wonder what will happen when Disney will try to slowly get out of such deep discounts.
I am not suggesting btw that Disney gone downhill because of that. If you read all my posts (which I really not expecting you to do ), you will see that I do not think Disney gone downhill, but I see some not so good changes that make me feel like Disney is not on the top either. Price however is something that worries me as first, I do pay rack price for most of my vacations since I book less then a week in advance and second, because I see some not very good changes in onsite resorts, which makes me personally feel that I can bring my money offsite. While it is my personal opinion, there are people who feel same way and I believe some of them right in those 7%, which we cannot rule out.

BTW, what is wrong with board today? All your responces to my posts somehow appear before my posts and I keep missing them.

Wow. Booking less than a week out. I have my vacations for 2012 and 2013 already booked. My 2012 vacation has been booked since October 2010. Since we are DVC, I booked the land portion on the 11 month window exactly. We are waiting until the 11 month window for our 2013 vacation. I think I'd go crazy waiting to book not knowing when we can go next.

Second - I've seen that phenomenon before. About three years ago, I participated on an extremely active meet thread for a cruise. We had about 10 to 15 pages per day, and often more. There were many times where we saw this exact thing happen. Posts hit out of order so the reply was posted before the question/original post. It became really annoying as we hit our different "000" thresholds as we had a little contest for those who were the "x,000" post in the thread. This thread is getting to the point where we could have the same contest.

 

[flicx]

Just for reference, that isn't all that much more than plain 'ol inflation over the same period. (not that I'm a fan of resort prices going up)

From 1994 to 2012 (18 years), using your numbers, the average annual price increase for the resorts you list:

Contemporary: 2.8%
Polynesion: 4.1%
Beach Club: 2.8%
Grand Floridian: 3.6%

Inflation during that same period was 2.5%

Only the Poly and GF really outpaced inflation, not by leaps and bounds but still significant. The poly must be a VERY popular resort to command that type of annual price increase over the last 18 years though. That's impressive.

Dan

Actually if you look at post 3320.I said I thought the most significant increases have occured since 05.

 

[brunette8706]

I think I captured the answer to this in my last post above (wrote it before I saw this post of yours, flicx).

You are only capturing one side of the equation: price increase. The real question is whether consumers are willing to pay that increased price -- that's what determines whether there continues to be value for the money in a Disney vacation -- demand at current prices.

I mentioned before that historically, Disney customers tend to be extremely loyal -- there is tremendous price inelasticity of demand -- i.e. consumers are willing to bear fairly large increases in price because they view the product (a magical experience) to be extremely unique and thus valuable (as compared with widgets, for instance that have exact substitutes).

With respect to comparables / substitutes... my 2 cents... Universal is comparable in that they are a theme park. They are closer to a Disney product than, say, Six Flags, but they aren't Disney. Again - take it for what it's worth, but I say this after studying Disney Parks SBU and its competition for an entire semester and writing that big 240-page paper (that I got an A+ on ... and in a top business program and finance masters program that I got a 4.0 final average GPA in... and graduated 1st in the class... so I'm not exactly an idiot... is there a "tooting your own horn smiley??) ). I know... it absolutely doesn't mean that I'm right, but it does mean that I combed through A LOT of data, etc. in making these conclusions. And FYI, so have many other marketing and business experts over the years. Disney isn't a model for nothing!

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Actually, your data is flawed. I'm sorry, Master's Degree or not; how can you have "absolute" concrete "DATA" when Disney doesn't even really give us correct numbers/data? Your analysis in MY OPINION is flawed, or null and void.

With that said, if Disney was projecting great occupancy rates they would not have the FREE DINING offer 9 months out of the year. They also would not have FREE DINING during various holiday periods. They have never done this before in years past, EVER. They are doing this to BRING in more people to occupy their resorts. With that said, there is still much available vacancy rates where as years ago there would be close to zero vacancy.

Another thing, Disney as a "WHOLE" is a great vacation. We all agree to that. Some things, though are in a decline, maybe this is not noticed by your newcomer or newbie, but plenty of people that go to Disney once a year or once every 2 years have noticed a decline ON SOME THINGS. These "THINGS" are food, some restaurants, monorail issues, some of the resorts, mousekeeping, holiday decorations etc. We have noticed on this DIS board about some of the complaints. A few years back complaints were very low and were not as prevalent as they are now. People are starting to notice. BUT, as I said at the same time Disney as a whole is a great place. We keep going back, as do most people on this very thread. We just don't go to certain restaurants, we don't do the "parties" in the MK, so we do show our concern in various ways with our wallet.

Brunette

 

[MickeyMinnieMom]

I do not know how many rooms were added, the only hotel rooms I can think of is new wing for CR and it does not make 7%. New value resort opens in May 2012, so we cannot count it yet.
So sugnificant or not, with increase of 1%, 7% down for hotels means something.

Yes, the remaining visitors do show they would pay a bit more which is evident from Spending/room but we cannot ignore what happen to those 7% and it does make me wonder what will happen when Disney will try to slowly get out of such deep discounts.

I am not suggesting btw that Disney gone downhill because of that. If you read all my posts (which I really not expecting you to do ), you will see that I do not think Disney gone downhill, but I see some not so good changes that make me feel like Disney is not on the top either. Price however is something that worries me as first, I do pay rack price for most of my vacations since I book less then a week in advance and second, because I see some not very good changes in onsite resorts, which makes me personally feel that I can bring my money offsite. While it is my personal opinion, there are people who feel same way and I believe some of them right in those 7%, which we cannot rule out.

BTW, what is wrong with board today? All your responces to my posts somehow appear before my posts and I keep missing them.

I definitely get your points. I would posit that the 7% is a combination of weak economy (worst economy since the Great Depression... as the politicians like to remind us!! ), along with the increase in rooms - though granted BLT is a small block on the whole # of rooms. And it's hard to argue with occupancy being steady over the past couple of years despite a 9.8% increase in spending/hotel customer...

I was wondering if the display of posts being messed up was just on my end somehow... odd...

Thanks again for the dialogue here... and I do get what you're saying. We had more monorail issues than ever on our last trip (we go annually), and some other little things seemed to have slipped a bit. But on the whole, for us it's still more than worth it. And I have faith having followed Disney for AGES and studied them more recently that ultimately, leadership makes generally the right calls (expansion, investments in technology, more DVC resorts, etc.). And I do think that the data we have does not indicate decline... yet...

Nice chattin' with ya' today, btw!!