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Disneyland Article
Could Slightly Lower Attendance Be A Good Thing

ID:TMS-3601
Source:Orange County Register
Author:Robert Niles
Dateline:June 7, 2017
Posted:June 17, 2017
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Is Disneyland's attendance falling? And if it did, would that be a bad thing?

The theme park industry's annual attendance report came out last week, and it reported a nearly 2 percent attendance drop for Disneyland and nearly 1 percent decline at Disney California Adventure in 2016.

That might seem hard to believe for many Disneyland fans that spent the past year crammed in pathways around Fantasy Faire or the Matterhorn on a Friday night. But remember that Disneyland was coming off the wildly popular Diamond Celebration last year. And, the closure of Big Thunder Trail, the Disneyland Railroad and the Rivers of America attractions for Star Wars land construction made the rest of the park seem more crowded even as fewer people might have been visiting.

So if declining attendance wasn't good news for line-weary fans last year, surely it wasn't good news for Disney, either, right? Well, maybe but maybe not. Sometimes, declining attendance can be a good thing for a theme park.

How? Ultimately, a theme park doesn't care as much about how many people come through the gates as how much money the park makes from those visitors. A theme park would rather welcome a family of four, all buying full-priced tickets and paying for three meals and souvenirs in the park, than a family of six that comes in on heavily discounted tickets and buys nothing while they are there.

Of course, any park will take both types of families if it can. But for a park that hits capacity every now and then, such as Disneyland, the tradeoff between high-spending and low-spending visitors becomes a real issue instead of just a hypothetical one.

Disneyland fills its parks through much of the year thanks in large part to a successful annual pass program which allows thousands of local families to visit the parks dozens of times for the price of just a few days' tickets. But that means Disney is making much less on each annual pass holder's visit than it would from a "regular" guest. And insiders at the company say that gap is getting bigger.

That's why Disneyland created a new, high-priced Signature Plus annual pass, then blocked out all other APs during the last two weeks of the year. With that change, Disneyland didn't have to turn away "regular" ticket-buying guests as the park didn't hit capacity at all last holiday season until the first day that the AP block outs lifted for everyone else.

Disneyland also is employing other ticket strategies that might one day allow it to do away with some of its less expensive annual pass tiers. Variable pricing on one-day tickets helps encourage visitors to come on traditionally less crowded days by offering tickets at a lower price than on average or peak days.

Seasonal discounts on multi-day tickets also allow Disney to steer visitors toward less popular weeks. Disney would far rather have price-conscious fans visiting the park for three days on a $149 Southern California Resident discount ticket than for up to 170 days on a $339 Southern California Select annual pass.

The trick is balancing a pricing structure that doesn't make formerly uncrowded days at the park unbearably packed. Disneyland hit capacity again last month during a non-holiday week because its Southern California resident tickets were expiring, and visitors crammed the park to use them before it was too late.

Ultimately, Disneyland would like to have it both ways - a park nearly filled to capacity every day with high-spending guests. That doesn't leave room for people visiting on relatively low-priced annual passes. But with more attractions based on wildly popular Star Wars and Marvel attractions coming to the parks, I'd bet on Disneyland getting what it wants some day and sooner rather than later.
 

 
 
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