International Disney Economics - near future

Well folks, as I lay bored in my sick bed today, I have read a number of threads showing concern about what Disney might do if the fuel costs and economic softening bites hard on the Disney resorts around the globe. With rumours abound of new developments (DCA placemaking, new attractions and shows on the slate for WDW, height balloons at WDSP); these attractions we Disney fans yearn for could go on the back burner. As I read about the slow down, foreclosures, and the like in my birth land in the US, and over here in my new (well if 66% of your life is new) homeland in the UK, it makes one wonder about the future.

From Kevin Yee’s article on MiceAge, to the ponderings of many board posters (you know who you are). A few bury their heads in the sand and say there is no down turn, its other people’s fault. Others say, ok, we will weather the storm and the Europeans will save us because of the weak dollar and warmer weather. Well, I am afraid I am not as optimistic as those speculators. It is now cheaper to go to Disneyland Paris by far (analysis to come in the next update), and the quality at WDW (which to my mind is already not what it once was), is on the verge of declining by even greater degrees. Disneyland I am sure will weather the storm, and Disneyland Paris is likely to perform well too. But WDW and corporate Disney are likely to take a hit and that can slow the impact on the rest of Disney’s development.

In the meantime the rest of the world is kicking it up a notch or 3. In Dubai they're building a real EPCOT (though scarily with no master plan or architect), in downtown Jebel Ali, they are building in GPS personalised Peoplemovers right now, as well as a whole light rail infrastructure to open by 2011/2012. With Atlantis, Universal Studios, Marvel Super Heroes, Sea World, Discovery Cove, Aquatica, Ferrariland and more coming, as well as the great 7 star hotels, and Marriott Vacation Club striking ground, Europeans may feel a greater pull towards Dubai, especially if the marketing machine kicks in.

Dubai and Macau near Hong Kong are potentially offering more impressive attractions now than Las Vegas or Disney, and the moneyed Europeans may now be setting their eyes east. Pretty soon WDW will have mainly the UK versions of red necks while the real spenders will go elsewhere (unless they are culturally or linguistically prudish, which upwardly mobile people tend not to be).

Cutting will not do Disney any favours. If they were really interested in the long term, they need to invest. Sadly, we know most of the execs are there for the short term, and it seems there is little vision left; the focus is on the markets. People like Joe Rohde, John Lasseter, and the tenacity of wonderful cast members give me hope, but I sense we are in for a mighty economic storm with a deep impact on Disney’s approach to the future.

Sorry guys, the Disney quality seems to be fading. It's still there in pockets (most new mega ventures at first - e.g. Expedition Everest, DVC; Disneyland is up to quality again; the Lion King Stage show; and I hear great things from seasoned cruisers about DCL), but when there is more Wal-Mart quality than Bloomingdale's (like the old days), well you have to ask yourself. The licenses seem to take up the largest chunk of the budgets, along with everyone’s return on sale; there seems little left for quality in merchandise, TV, and attraction design. If it’s toons, tweens, or thrills, well it’s happy clappy time. Disney, after being a visionary market shaper has become a commodity house, and the upcoming economic downturn is sure to impact deeply unless the guys in Burbank, Glendale and Orlando play it carefully.

If they do not, there will be trouble ahead. And when things get better economically (and we know eventually it will as the last 80 years have shown us to be a boom/bust economy), and there is nothing new, and Joe six pack no longer get's his "free $25 burger" in EPCOT's France pavilion (once known as a purveyor of fine foods), Disney will really struggle. The bargain hunter will go to the next best deal, or stay off site again. ~Those of us with a lifetime of loyalty may or may not still be there. And the international whales that they try to pull into the Deluxes or the new 4 Seasons will likely be in Dubai or Macau. And people are getting older. All this marketing to kids is silly too. Yes, hopefully there will always be kids. But it is the baby-boomer with all the money! Disney needs to remember that their founder wanted a place everyone could enjoy, aiming at narrow demographics will not improve their economic potential.

This is not the first economic down turn in Disney’s international history, and it won’t be the last. Let’s hope Disney tries something new rather than getting back to their recent old tricks – anyone been to Pop Century lately – the ghosts of the last downturn still therein remain.

“But Sooner or Later that rabbit is gonna come home

(gonna come home)

He's learned his lesson again.”

If they look to the past, look further back than the last 15 years, to a time where quality sold and can sell again. I hope we once again find the laughing place.