new annual passes - short term thinking from Disney?

[jknc]

Dont most business schools teach, your best customer is your current customer?

How much money does it cost to acquire new customers?

If others find value in $6500 APs, that’s great. I’m not questioning what they value, nor do I expect anyone to question what I value. We’ve been fortunate to visit many times and in addition to tickets have dropped an unknown amount of money on character meals, deluxe rooms etc.

I wouldn’t have booked those trips if I didn’t feel like there was value at the time.

 

[Suzabella]

your best customer is the customer who is spending money and generating revenue. More and more this is the new customer, not the returning customer. A business can not survive with just returning customers who are not increasing revenue.

Nor can they just survive on the one and done. A business needs a blend of both. They need the loyal, repeat customer base to get them through the lean times...or off season....or pandemics.

 

[jknc]

your best customer is the customer who is spending money and generating revenue. More and more this is the new customer, not the returning customer. A business can not survive with just returning customers who are not increasing revenue.

Again, how much are acquisition costs? I can’t answer that. But all company’s have customer acquisition costs.

So imagine for a moment a family of 4 pricing their first Disney trip. What’s the value prop to get them to spend the money on the trip?

The repeat customer knows the value prop and can make a decision if the juice is worth the squeeze.

 

[haunts999]

People are coming out of the pandemic with different points of view than 2019. Priorities have changed for many. They want to do the things that they've put off rather than repeat experiences. Resistance to change has nothing to do with it. The ability or willingness to pay for what Disney is charging is and there are many who just aren't seeing the value or can do many other things for less.

I think this is a definitely a part of why so many people (namely FL residents) are now hitting their breaking point with Disney. So, to those who are saying "Oh, but you'll still pay the prices, you say this every time, etc.," I think Suzabella is right -- this time feels different and the majority mean what they're saying. I think this is the bridge too far, and I don't mean just the APs; I fully expected to be priced out of them within the next year. I've decided the worst part of all this is that it came very quickly, all at once, and very harshly. I don't care what anyone says, they're actively giving you less and requiring you to pay more and not hiding the fact they're doing it. Of course they're a business, of course they're a theme park at the end of the day, but the facade is gone. I don't think even Eisner would've done it like this. And it's happening during a pandemic (May just be bad timing, but still -- bad optics).

This is a bit of a rant, so I apologize, but those who are saying that "Disney doesn't care about you, there's always someone to take your place," you're right. We know that (It's starting to tick me off, because it's just poking the victim to poke the victim). We love Disney, so of course our emotion is tied into it -- and that's perfectly valid. Ultimately, people are upset and they're venting because they're losing something they cared about, that they put money in, and especially after the last 15 months, it's all just a hard blow. IMO, this customer base they're now aiming for won't be sustainable, or at the very least, what Disney once was is gone.

//respectfully ends rant//

 

[haunts999]

Nor can they just survive on the one and done. A business needs a blend of both. They need the loyal, repeat customer base to get them through the lean times...or off season....or pandemics.

Yeah, funny how they screw over the people that actively gave them money during a pandemic.

 

[NoTime42]

Again, how much are acquisition costs? I can’t answer that. But all company’s have customer acquisition costs.

So imagine for a moment a family of 4 pricing their first Disney trip. What’s the value prop to get them to spend the money on the trip?

The repeat customer knows the value prop and can make a decision if the juice is worth the squeeze.

It’s currently an engrained “bucket list” in general culture that in general, families should take young kids to Disney for 1 trip. And they know it’s not cheap. It can’t be checked off the list by going to better values.

 

[BadPinkTink]

It’s currently an engrained “bucket list” in general culture that in general, families should take young kids to Disney for 1 trip. And they know it’s not cheap. It can’t be checked off the list by going to better values.

This exactly, especially in Europe. Going to Walt Disney World has been heavily marketed as the ultimate one and done big family holiday since the 1980's. People save for 2 or more years for the big blow out holiday and a huge high street bricks and mortar travel agency industry has been built up around this marketing by Disney.

Currently there is huge pent up demand for Walt Disney World as Europe has been banned from entering USA since March 2020. Huge numbers of people have had to push their holiday to 2022 or 2023.

 

[ctrabada]

I think this is a definitely a part of why so many people (namely FL residents) are now hitting their breaking point with Disney. So, to those who are saying "Oh, but you'll still pay the prices, you say this every time, etc.," I think Suzabella is right -- this time feels different and the majority mean what they're saying. I think this is the bridge too far, and I don't mean just the APs; I fully expected to be priced out of them within the next year. I've decided the worst part of all this is that it came very quickly, all at once, and very harshly. I don't care what anyone says, they're actively giving you less and requiring you to pay more and not hiding the fact they're doing it. Of course they're a business, of course they're a theme park at the end of the day, but the facade is gone. I don't think even Eisner would've done it like this. And it's happening during a pandemic (May just be bad timing, but still -- bad optics).

This is a bit of a rant, so I apologize, but those who are saying that "Disney doesn't care about you, there's always someone to take your place," you're right. We know that (It's starting to tick me off, because it's just poking the victim to poke the victim). We love Disney, so of course our emotion is tied into it -- and that's perfectly valid. Ultimately, people are upset and they're venting because they're losing something they cared about, that they put money in, and especially after the last 15 months, it's all just a hard blow. IMO, this customer base they're now aiming for won't be sustainable, or at the very least, what Disney once was is gone.

//respectfully ends rant//

Totally agree. We're FL residents and DVC members. Did not renew our pass in 2020 (after 24 years as passholders-family of 3) because I didnt see the value with all the things they removed. We did buy Universal Studios annual passes and have visited UO, several times. We even stayed onsite twice (Cabana Bay and Royal Pacific). Twice, we have stayed at our DVC and gone to UO (and not Disney). We are now thinking of selling our DVC points. So, yes, I agree that we are emotionally involved as Disney fans and that Disney doesn't care for us at all. But they used to care about the customer experience and that has also deteriorated in a big way. There is no longer value in their offerings. It's money grab after money grab. I, for one, I'm done. So, like @BadPinkTink says, we're now at the end of our cycle. Universal, on the other hand, has won our money instead. I used to spend my birthday every year at Disney for the past 20-odd years. Last year, we went to Asheville, North Carolina. This year, Pigeon Forge, Savannah and St Augustine. Next year, a cruise to the Galapagos. We are now finding the real world outside Disney World. I'm still heartbroken, but I'll manage to carry on just like Disney will manage to survive without me (or without caring about me either).

 

[Richelle305]

Dont most business schools teach, your best customer is your current customer?

How much money does it cost to acquire new customers?

Exactly. It's more expensive and risky to target a new audience than it is to focus on retaining a loyal customer base. Disney either doesn't know their audience anymore or they are targeting a new one.

 

[RamblingMad]

I think, this is Disney's way to get a bigger slice of the stimulus savings from last year for the lower income customers while still providing perks via Genie+ and LL for the more well heeled customers. I don't think this will impact Disney at all. The US alone has over 30 million millionaires.

I'd rather invest the cost of the AP into Disney stock than go to WDW right now. Discounts should come in the future after the pent up demand for travel subsides.

 

[jknc]

I think, this is Disney's way to get a bigger slice of the stimulus savings from last year for the lower income customers while still providing perks via Genie+ and LL for the more well heeled customers. I don't think this will impact Disney at all. The US alone has over 30 million millionaires.

I'd rather invest the cost of the AP into Disney stock than go to WDW right now. Discounts should come in the future after the pent up demand for travel subsides.

I like your thinking, for me $6500 invested in $dis is a smarter use of funds than an AP.

Despite my frustration at the rapidly rising costs, we will still have fun @ WDW in February and DL in June.

 

[Disneyfan754321]

I feel the same way, it doesnt seem responsible. If I spent $800 right now I could have 4 four packs of florida resident tickets and I could buy another set every month for the same $200. Yes I know they have expiration dates but they are always worth the 200 I paid and I have more days I can go.... if I was to go that route. SeaWorld and Legoland funpasses are $100 a season slightly more if you want to add water parks. And at Universal the top pass is less than the lowest pass with weekends

We’re of family of 5 who are fortunate to be able to afford $6500 for annual passes.

However, is that a smart use of $6500 for leisure?

Not at all, IMO.

The US is a big, beautiful country. We are excited to find new places to explore.

 

[Boski]

A company's biggest marketing strength is word of mouth, if you enjoy something you're going to tell your friends and family about it. When you started agitating your loyal customers they're going to say something. I think most of us here on these boards are huge Disney fans. Most of us are probably the "Disney person" in their social circles. And if people are getting priced out, if perks are being removed, if its not as magical as it used.....when someone asks them about Disney they're going to be more inclined to suggest other vacation options or say things like "its not as good as it used to be".

 

[John and Theresa]

A company's biggest marketing strength is word of mouth, if you enjoy something you're going to tell your friends and family about it. When you started agitating your loyal customers they're going to say something. I think most of us here on these boards are huge Disney fans. Most of us are probably the "Disney person" in their social circles. And if people are getting priced out, if perks are being removed, if its not as magical as it used.....when someone asks them about Disney they're going to be more inclined to suggest other vacation options or say things like "its not as good as it used to be".

Really good points. So many of our friends and family form UK have made the WDW visit on our recommendation. I am not saying we won't still be visiting, still raving about it and still encouraging others to do the same. It just isn't as certain as it was. Last year and without thinking or debate, we had two weeks booked in May and November and with AP discount we have been spending more on merchandise than every before. We do want to return, but we equally want to return to Italy which is such a beautiful country also. On that point, how many of the World Showcase countries have we all visited properly?

 

[dvc lover 1970]

The whole problem is like Pete said, is that the customers have an emotional tie to the company, but Disney runs the business without emotion.

To understand the why of Disneys decisions you have to take the emotion out of it. Every Disney guest is basically a number on a spreadsheet. If that number makes the company money great, lets keep giving them the things they are buying. If that number is not making the company money, how can we change that. We can either give them something that they will buy OR get rid of them and replace them with someone who will make the company money.

Now once you understand that, once you take the emotion out of it, you can choose what to do. You can choose to say, well I accept that Disney only see me as a number, BUT I place a high value on the experience I get as a customer , so I will continue to be a customer.

OR

You can say, the value of the experience has diminished and is not as high as it once was, so I choose NOT to continue as a customer.

Each one is a personal decision, based on individual circumstances. And Disney is WELL aware of BOTH types of customers. Each decision is right for that individual.

Where people are wrong is to think that their individual decision to stop being a customer will make Disney care about them, and that their emotional ties to the company mean something to Disney. To be harsh, it does not.

And yes running a business is ruthless and harsh decisions have to be made. Successful businesses are not run by lovey dovy emotional people.

But you are forgetting that disney is a company built on a brand of customer service. If that pillar fails their customer base may diminish too. How much can disney continue to raise prices? They raise prices drive some people away but the amount that comes right now more than covers those who leave. I think at some point we will see a flippening where they will no longer cover costs. Would you rather spend $$$$amount to go to disney or go on other national or international vacations? My point is the cost keeps rising and while I like disney there are many other vacations I can take besides Disney. I am very close to that tipping point myself. I am sure many others are.

 

[PirateBrigade]

And yes running a business is ruthless and harsh decisions have to be made. Successful businesses are not run by lovey dovy emotional people.

100% this. I would NEVER buy a stock in a business run by lovey dovy emotional people, because I want my profit, or I will take my money elsewhere.

Disney is a financially successful business because they stick their creative people who take advantage of our lovey dovy emotions in their marketing department, and they are able to project these fanciful images back to make it seem like Disney the company feels the same way. Brilliant.

Every now and then, you see cracks and the true nature of the beast, such as Bob Chapek via company legal counsel's misogynistic and aggressive attempted take down of Scarlett Johansson in the press in a very public way, or their attempts to silence the sexual assault/harassment victims at Disney-owned ABC. That tells you everything you need to know about what they really are going after as a company.

But you know... castles and princesses, etc etc...

 

[AlanBradley]

A company's biggest marketing strength is word of mouth, if you enjoy something you're going to tell your friends and family about it. When you started agitating your loyal customers they're going to say something. I think most of us here on these boards are huge Disney fans. Most of us are probably the "Disney person" in their social circles. And if people are getting priced out, if perks are being removed, if its not as magical as it used.....when someone asks them about Disney they're going to be more inclined to suggest other vacation options or say things like "its not as good as it used to be".

Really good points. So many of our friends and family form UK have made the WDW visit on our recommendation. I am not saying we won't still be visiting, still raving about it and still encouraging others to do the same. It just isn't as certain as it was. Last year and without thinking or debate, we had two weeks booked in May and November and with AP discount we have been spending more on merchandise than every before. We do want to return, but we equally want to return to Italy which is such a beautiful country also. On that point, how many of the World Showcase countries have we all visited properly?

I wonder if with an iconic brand like Disney word of mouth doesn't count for as much as we might think. Although I have recommended Disney vacations to a few people who are now all hooked - I am unsure if that makes a significant impact to their turnstiles. They have the analytics to back these decisions, which tells me they don't feel it to be an issue.

But you are forgetting that disney is a company built on a brand of customer service. If that pillar fails their customer base may diminish too. How much can disney continue to raise prices? They raise prices drive some people away but the amount that comes right now more than covers those who leave. I think at some point we will see a flippening where they will no longer cover costs. Would you rather spend $$$$amount to go to disney or go on other national or international vacations? My point is the cost keeps rising and while I like disney there are many other vacations I can take besides Disney. I am very close to that tipping point myself. I am sure many others are.

I agree completely on the brand being built on customer service, but we are talking about pricing - I don't think there is a correlation. Hypothetically if a first timer visiting in 2022 has no knowledge of prior pricing or perks is the customer service significantly worse than an initial visit would have been in 2019?

 

[BadPinkTink]

I wonder if with an iconic brand like Disney word of mouth doesn't count for as much as we might think. Although I have recommended Disney vacations to a few people who are now all hooked - I am unsure if that makes a significant impact to their turnstiles. They have the analytics to back these decisions, which tells me they don't feel it to be an issue.

Exactly. Disney is one of the unique brands which is ingrained in popular culture.

I agree completely on the brand being built on customer service, but we are talking about pricing - I don't think there is a correlation. Hypothetically if a first timer visiting in 2022 has no knowledge of prior pricing or perks is the customer service significantly worse than an initial visit would have been in 2019?

Correct, the first time casual guest has no previous knowledge or expectations of how things used to be. They only know how it is now. How things were in 2019 has no meaning to people on their first visit in 2021.

 

[Lmans77]

I understand your business term
Disney advertises itself with the emotional ties - they pull at heartstrings - they want to make that connection
But it very well could be short term thinking - drop off a whole tier of customers because you have priced them out - say a family with 2 kids - you run the risk that those two kids will never be customers - and thus cycle can continue - and spread like wildfire
No one is too big to fail - show your customers you only care about money and soon enough you won’t have either - I remember way back when Disney stock was under $10 - make mass amounts of your client base mad - trust me there are nut bottomless clients - eventually the bottom falls - that is also business 101
Yes you need to show you care about your customers if you care to have some - not just the very well off customers - Disney is pricing themselves where so many can’t or won’t be able to go - is it a God given right to go ? Nope - but what kid (adult ) wouldn’t like to go ? Most kids would - most parents wouldn’t like saying no too expensive but now will have too
I’m a huge Disney fan - my friends often in past have come to me and they thought it was so expensive - now they won’t even consider it - way too expensive - I’m in the camp I’m in agreement - hence why I’ve sold some of my DVC and I’m considering selling the rest - very sad
Yes it’s a business I get that but just like any other if you don’t give me what I FEEL is good value and treatment for MY money I’ll take my money elsewhere - you can call that emotional - I call it the way I handle my money - plenty of places out there that will value me as a customer and appreciate me spending my money with them - isn’t that what you want ? To be valued ??? Disney has lost sight of this trying to make the stockholders rich
Just my thoughts

100%. "too big to fail" - seems like that is their attitude of late, it will be interesting to see if this short term gain leads to any long terms pain. I'm a new DVC blue card holder and I don't feel like I'm getting a very good value anymore. We'll hang on to it and we'll go, but I think instead of the 2-3 trips a year that we've been averaging for the last 5 years, it'll now be every other. So when people say "oh yeah, they'll still go", sure they might, but it might be a whole lot less, especially with the AP prices.

 

[jknc]

Has anyone spoken to someone who went on their first Disney trip in the last 12 months? I’d be curious what their thoughts were.

Or anyone on these boards who went for first time? Although, this is a fan site so sometimes hard to get fair evaluation of the first timers here.