This past week, Disney fans were stunned when more closures were announced for Walt Disney World, including next year's planned shuttering of DisneyQuest as well as more attractions at Disney’s Hollywood Studios closing in the immediate future. However, the loss of these attractions is nothing new, as the past 18 months have seen over a dozen closures at Walt Disney World, and more could be coming soon thanks to the total reboot of Disney's Hollywood Studios.
With so much being lost at Walt Disney World, many have wondered how Disney can continue to hike prices year over year, when it seems each year brings less and less for guests to do at the parks. However, despite this distressing development, price hikes are going to continue for the foreseeable future at Walt Disney World, and here's why:
1. Guests are spending more than ever
In a report released by the Orlando Sentinel earlier this week it was revealed that per-visitor spending at Disney's domestic parks (which include Walt Disney World and Disneyland Resort) has increased 7 percent to 8 percent annually over the course of the past four years. What's interesting here is that all this spending is taking place alongside annual price hikes, which means higher ticket prices are not deterring guests from spending more money on food, souvenirs or various other items around the parks.
Though this year Walt Disney World hit a milestone by breaking the $100 mark for a one day ticket (only for the Magic Kingdom though, as Walt Disney World’s other parks are holding steady at $99) guest spending is projected to grow yet again in 2015, in spite of the higher cost of admission.
So what factors are responsible for this phenomena? While no meaningful research has been done on why guests are spending more in the park after paying more at the gate, it could be that Disney is shifting its focus to catering towards a higher class of demographic and is attempting to leave the penny-pinching middle class behind (who would be less likely to spend money in the park after dropping a huge chunk of change on admission).
Walt Disney World’s recent refurbishment of the Polynesian Village Resort (and planned refurbishment of Disney’s Wilderness Lodge) would seem to bear this idea out, as expensive bungalows that cost thousands of dollars per night have been prioritized over budget-friendly rooms, which had previously been instrumental in making an on-property Walt Disney World vacation affordable for those on a middle class budget. However, because middle class guests aren't driving profits with increased spending inside the parks, Walt Disney World is no longer looking to them to boost their balance sheets.
Which leads us to our next point...