4 ms·
If word-of-mouth marketing is important ("Mom, my friend went to Disneyland last year, why can't we go?") then attendance may drop off more quickly with a price
by xapata 5y ago
If word-of-mouth marketing is important ("Mom, my friend went to Disneyland last year, why can't we go?") then attendance may drop off more quickly with a price increase than for other goods. The cost of recovery might be high. Also, we don't know the balance of sunk costs and operating expenses, and the expense of a marginal guest.
Walt Disney designed the company to have its various activities support each other, so each in isolation might appear underpriced. Is the goal of Disneyland to make a profit on tickets, or to sell toys and a Disney+ subscription when the kids go home?
- logicalmonster 5y agoYou might be correct, but just to play Devil's advocate a bit more, in the social media age, word of mouth marketing might be overshadowed in importance by the importance of social status in marketing, which a more exclusive experience would be. Imagine if Disney was a bit more of exclusive experience, and people felt they could truly boast about visiting Disney that year. That's a powerful thing in marketing. People who were on the fence might feel compelled to save every spare dollar they could to try and make the trip happen. I understand that they don't want to be seen as elitist, there's probably a fine line that would have to be made here. And I'm sure that Disney employs a number of analysts who have tried to figure out all of these scenarios already. Just interesting speculation. I think the safest path for them is keeping prices high, but not out of reach for most families to reasonably aspire towards.