More thoughts on Disneyland Annual Passports

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And the comments continue on the recent announcement of the increased price of a Disneyland Annual Passport. Christopher Elliot of Fortune.com chimed in with a story this morning on the controversy.

Guess who shows up as a commenting Annual Passholder? Roger Colton, of Livermore, CA.

I did not get the opportunity to speak with Christopher before the story went live, but sent him a note with some additional thoughts. And I would like to share it here –

Chris:
Thanks for the quote in your story.

A couple of points I think important about Disneyland and Annual Passes.

First, Disney created it’s own problems with the Annual Pass. In 1984, the Park faced declining attendance, especially during the LA Olympic games. Passes were first sold to members of the Magic Kingdom Club (a corporate travel benefit organized by the Disney company, offering discounts and specials). Having replaced ticket books in 1982 with the all in one ticket to the Park (covering all attractions except the shooting galleries in Frontierland and Adventureland), the company needed some way to generate more customer visits. With the Annual Passport, guests could spend an amount and have unlimited entry to the Park. Those 1984 passes cost all of $65 or the equivalent of 5 days admission with the one-price tickets (at $14 a day). If you take look at the costs today with the Signature Plus Passport at $1049, with the $99 one-day admission price at Disneyland, it now takes 10 days to equal that initial cost. However, if you factor in the Park Hopper cost ($40 upgrade), the resort parking fee of $18 a day, the merchandise and dining discounts of 20% and 15% respectively, along with the new addition of Photopass, one can come closer to that 5 days than you might think.

Second, Disneyland was never meant to be the “local hangout” that is has become. Call it the modern day equivalent of the corner pub or bar, or even a trip to the mall and you pretty much have hit the nail on the head. As a place for families to enjoy a shared experience? Yes, Disneyland is a destination. Designed to create what Walt Disney wanted and what he got. But as it matured, thanks in great part to the Annual Passports, the idea of a drop in visit or a place to gather became something one could share with more than just family. Hence the growth of social groups at the Park. And with the birth of the Internet and social media, event more folks meet with those sharing similar interests. All adding to guest numbers in the theme parks.

Third, even though Disney does not publicly release numbers of visitors or Annual Passport holders, it can be seen how they impact guest attendance numbers. A visit to Disneyland on days when there are Annual Passport blackouts,  and you can see fewer people inside the gates. But on Sunday’s when the passes are not blacked out? Yes, higher numbers of guests, making for a more crowded Disneyland.

Fourth, Disney has created a financial monster it is reluctant to slay. If you add up all of the income from Annual Passports, it is a tidy some that makes accountants and shareholders smile. Do away with passes entirely, and guest attendance numbers would probably see a dip, but the most desirable of guests would probably remain constant. That being the mythical family of 4.3, coming to Disneyland for that once in a lifetime visit. In the best of all worlds, that family stays for 3 or more days, at an on-property hotel or in one of the Good Neighbor properties nearby. They spend more per capita per visit on Disney property than the average Annual Passport holder. More on food, more on souvenirs. They part with more of their disposable income or bend the credit limit more than the Passholder. Sadly, they also get to spend more time wasted in lines thanks to the higher attendance numbers.

Disneyland is not hurting by any means. The 60th anniversary celebration has been a great success with a relatively small investment. There were no new attractions launched. A new fireworks show, a new night time parade and a revamped water show. Yet guest attendance numbers are up, as seen by more people in the Parks.

Griping about the cost of a Disneyland Annual Passport is not new. I have been on the fence as to buy one or not myself for the last few years. If not for the monthly payment plan offered to California residents, I would likely not purchase one. But I do see it as a good value. If you really want to break it down? That $1049 cost comes out to $2.87 and change per day of the year. Match that against an annual health club membership, a season snow ski pass or major sporting event season tickets. For the money Disney charges, it is hard to beat the price. You can’t even get a cup of coffee every day of the year (that’s 365 of them) at Starbucks for that $1049 price.

Will that higher price slow the numbers of folks who purchase the Annual Passport? Probably not. It may make them think more before they commit to the purchase. Should Disney look at the concept of the AP? No doubt they are. There are ways to improve it, such as demand pricing or even passes that have a limited number of days instead of the wide open calendar used now. But the end of price increases? Not by any means of the imagination. And if Disney has anything, it is imagination.

Sam Gennaway, author of the unofficial “Disneyland Story” shared this:

When the park [Disneyland] first opened, each guest bought a general admission ticket at the main gate and individual tickets for each attraction. The constant reaching into the pocket gave many families the impression that Disneyland was an expensive place to visit. When an Associated Press reporter criticized the park, Walt angrily replied, “We have to charge what we do because this Park cost a lot to build and maintain. I have no government subsidy. The public is my subsidy.” He added, “I mortgaged everything I own and put it in jeopardy for this Park. Commercial? How have I stayed in business all my life? The critics must know a newspaper exists on advertising. They’re crazy!” Walt reminded the press, “We have a lot of free things in the Park. No other place has as high a quality. I stand here in the Park and talk to people. It’s a most gratifying thing. All I’ve got from the public is thank-yous.”

The Disneyland Story: The Unofficial Guide to the Evolution of Walt Disney’s Dream – Sam Gennawey

Thanks and feel free to use any of this in a follow-up story on the subject. Or call me to discuss any points or further questions you may have.
Roger Colton

 

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