Asked about balancing attendance and capacity, as well as pricing, at Walt Disney World and Disneyland Resort, Disney CFO Hugh Johnston said he expects “to see both pricing and attendance growth over any three- or four-year time frame.”
Disney Parks Expansions
Johnston was asked about attendance, capacity, and pricing during a Q&A at the MoffettNathanson Media, Internet & Communications Conference. Johnston said, “There tends to be a lot of focus on attendance as a number. But the reality of it is, when you have a big fixed asset like we do, we tend to actually use promotional activities to make sure that we’re filling the park every day.”
“Without expansion, we don’t necessarily have the ability to grow attendance massively, because it’s already filled up,” he explained. Now, we could jam more people into the park, but then the guest experience declines, and that’s actually bad for the brand, so you don’t want us to do that, and we don’t think it’s a good idea, either.”
Adding capacity via expansions “creates opportunity,” Johnston said, referencing the recent Disneyland Paris expansion including World of Frozen. Both Walt Disney World and Disneyland Resort are in the process of expanding. Additions include a Piston Peak and Disney Villains Land at Magic Kingdom, as well as the near doubling in size of Avengers Campus at Disney California Adventure.
Johnston acknowledged the next question about expansion would be, “Does that mean the yield is going to go down?”
“That’s not been our experience,” he said, “because when you put in a big, new attraction, you see a surge in demand for it. So we tend to fill those things up really, really quickly without having to discount. In fact, it actually offers some ability to charge more because, essentially, you’re offering something new that wasn’t there before.”
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