By: Melissa Santos
The Disney Brand:
Throughout many generations, Disney has successfully provided individuals, families and children alike with many warm, happy memories. Disney is both a global and powerful brand that has been well established since the early nineteenth century. Disney not only connects with younger generations, it reaches and also speaks to adults of a wide variety of ages. The brand has touched and will continue to touch the hearts of individuals for many generations to come. Due to its prestige, Disney is a powerhouse that will continue to thrive far into the future.
The Disney brand is well known for its innovation and creativity that enables consumers’ “dreams to come alive.” The brand serves itself as a platform for all ages to reconnect with their inner child and imagination. Disney provides a magical, fantasy escape from ordinary life with their extraordinary tales of magic, love and adventure. The Disney organization will never cease to stop succeeding as its core values continue to touch the lives of many people world-wide.
Disney Theme Parks:
The magic of Disney comes to life within the walls of its globally renowned amusement parks. Across the world, more specifically in countries such as the United States, France, Japan and China, Disney has extended its imaginative world of laughter and fun to the consumer in the physical form of a theme park.
Disney attracts more than sixteen million guests per year to these amusement parks, and over the last sixty years, the park entry fees have increased steadily. According to the Wall Street Journal article, “Disney Parks Consider Off-Peak Prices” by Ben Fritz, the organization is contemplating a change to its current ticket pricing strategy by implementing a value based pricing system. Revenues for Disney are strong, and the company has maintained a continual, profitable increase over the span of the last few years. With revenues strong, the question remains: why change the pricing system?
As mentioned in the article, the primary reason for switching to a value based pricing system, aside from profitable growth, is to “help reduce congestion, and to raise attendance at slower times”. Meaning, Disney has had an issue with overcrowding during its busy season. These peak times include school vacations, the summer season, weekends and holidays. The proposed idea suggests that ticket prices will increase during peak times, while they will decrease during the slow season. The company hopes to attract a balanced number of guests all year round with this method. Simultaneously, Disney hopes to reduce the park’s current issues of overcrowding, long lines and extended wait periods for attractions, food and games. The company suggests that this change could potentially result in an overall increase in guest satisfaction.
The Consequences of a Value Based Price System:
In my opinion, an implementation of a value pricing system contains both positive and negative implications for Disney. Beginning with the positive, it could potentially decrease the number of guests during the busy season, allowing shorter wait times for rides, food, restrooms etc. It would also decongest the overwhelming atmosphere of such a heavily populated theme park. This would increase guest satisfaction, and keep the average park goer happy. For the company, it could potentially influence guests to consider visiting the park during the slower season in order to take advantage of reduced ticket prices. This would allow each park to be well balanced with guests all year round. Additionally, this enables the organization to profit and prosper throughout the year; however, this comes at a price.
The price surge during peak times could potentially anger loyal Disney guests and Disney communities. It could also deter many families because they may not be able to afford the park passes priced at new, higher admission rates. Issues of schedule conflicts could also negatively impact the success of this new system. Most families are confined to their children’s academic calendar in terms of when they can and cannot take family vacations. These schedules typically allow families to be able to visit theme parks during the peak season. If they are only able to visit the park during the peak season but cannot afford park admission, this may result in many families no longer vacationing at Disney. This could be a severe loss for Disney from a financial perspective, but more importantly, a loss from the customer loyalty perspective as well.
While weighing the positive and negative aspects of this system, marketers should be careful when implementing this new idea. There are many loyal Disney guests visiting, year after year, and with this new pricing system, they may not be able afford to vacation at Disney. Another major issue marketers are going to face is that families plan their vacations around their children’s educational schedule. This implies that school vacations, holidays and summer break are the only time in which they are able to take their vacations. Marketers must be weary when facing these dilemmas because these surging of prices may just deter guests (both potential and repeat) from vacationing at the Disney theme parks and resorts. Altogether, Disney marketers face a serious challenge. They must convince consumers that the brand and experience is worth the price increase, while simultaneously encouraging guests to pay less and visit the park during the off-peak season. They must promote both ends of the spectrum while maintaining the vibrant Disney brand.
Disney takes pride in their excellence, and they far exceed the expectations of all guests. I believe a value pricing system, if it is chosen to be implemented, will succeed. Disney theme parks provide an excellent experience for their guests that no competitor on the market can currently offer. The atmosphere, the amusements, and the Disney brand is what entices consumers to pay more for their tickets. Every potential and also every returning guest wants to experience, again and again, that magical, memorable experience only Disney can effectively and successfully provide.