Disney World is certainly no stranger to price increases. We’ve seen increases on ticket prices, merchandise, food, and more in the parks. But could we be in for even MORE price increases soon?
The Walt Disney Company recently held its 3rd quarter earnings call for 2022. During the call, they reported that guest spending has increased in the parks, which contributed to the large revenue gain seen in this quarter. In fact, the Q3 revenue at Disney Parks Experiences and Products increased to $7.4 billion compared to $4.3 billion this time last year. So why is Disney now hinting at more price increases to come?
Although the large increase in revenue may prompt the question of why Disney would need to raise prices, that same revenue increase is also the answer: Disney continues to raise prices, and people continue to pay more, which reflects high consumer demand. That high demand is why Disney may continue this trend of price increases, according to Disney CEO Bob Chapek.
In a recent interview with CNBC, Chapek hinted that more price increases may be on the horizon for the Disney parks. When asked about raising prices, Chapek said, “We always watch demand. When you’re playing a yield game like we are right now and you have the flexibility with our reservation system, we can move on a dime. We read demand, and if demand goes up, then we have the opportunity to do that. ”
Chapek also confirmed that demand is currently high and shows no signs of slowing: “For all visibility, we have into the future, we’re not seeing any softening of our demand.” Even despite international travel not being back to pre-pandemic levels, Disney announced in this past earnings call that customer demand is exceeding available reservations in the parks. More demand than supply is a recipe for price increases.
CNBC went on to ask if the current situation is simply pent-up demand from the pandemic when people weren’t able to travel. Chapek said, “We have enough data/research to suggest that this is going to be a resilient trend that we’re seeing right now; it’s not going to be something that’s a function of short-term demand because of pent-up travel demand.”
So when could we see those price increases? Chapek wasn’t clear about any specifics. He said that Disney has “no plans to announce right now what we’re going to do.”
When asked about people who are angry about the price increases, Chapek turned the responsibility back onto those same consumers. He said, “Well, it’s all up to the consumer. If consumer demand keeps up, then we act accordingly. And if we see a softening (which we don’t think we’re going to see) then we can act accordingly as well. We’re very flexible.”
During the earnings call, Disney also reported price increases for ad-free Disney+ and both versions of Hulu. Disney+ without ads will cost $10.99/month (or $109.99/year), an increase from the current cost of $7.99/month. Disney is adding an ad-supported version of the streaming service, which will cost $7.99/month. These changes will go into effect on December 8th of this year.
Beginning on October 10th of this year, Hulu will see a price increase as well. The ad-free version will increase to $14.99/month (up from $12.99/month), and the version with ads will increase to $7.99/month (up from $6.99/month).
When asked about the price increases for Disney+, Chapek said, “We thought this was the perfect time to go ahead and really sort of bring up that price value equation so that we’re more accurate and reflecting the value that our guest or consumer gets with Disney+ by taking up the price.”
We’ll continue to watch for more changes and price increases in Disney World, so stay tuned with AllEars for all the latest updates!
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Disney is still riding the pent up demand from COVID where people cancelled their vacations – especially the overseas visitors. However, once this fades all we see now are many people saying that they won’t return because of high prices.
In the parks it is the added costs for Genie+ and ILLs. In the resorts it is high prices for a poor value product now the perks have all gone and even the housekeeping is hit and miss in some resorts – something which most other hotels seem to have no issue with.
Give it a couple of years and then see how numbers are holding up.
He is trying to pull the wool over your eyes it is part of his game plan do not believe him. Call or e-mail Guest Services and tell them how upset you are & pass it on to everyone else and let it snowball!
Too big to fail? Maybe not….
This man is complete garbage! The only people he cares about is stockholders and no matter what kind of return they are getting its never good enough. It’s a shame that the average family wont be able to afford to go to Walt’s Dream!
He’s probably preparing you for the new 15% tax on book income disney will likely be subject to assuming the bill passes. Who do you think is going to pay the tax? Chapek’s salary or the consumer? This is a company and the world has changed. Nostalgia only takes you so far.
I’m not raising prices, you all are begging me to do it so I’m just giving you what you want! Brilliant, and people will buy this.
He is such trash, I hope people start to wise up and stop going to slow this “demand”. Its the only thing that will stop this madness. And hopefully get him fired. He is a greedy money grubber and always will be. Disney just isn’t the same since he took over and the pandemic was his ticket to do it his way
So if demand drops Bob will lower prices?
No way!
Just left there snd will never go back!
It’s just a place for the rich anymore. People are saving years just so they can take their kids to Disney, however with the gate prices snd then Genie and Fast pass it costs a family of 4 approx 1000.00 per day USA. If from Canada that’s 1350.00 a Day…. What!
$ 5-10,000 can be spent at Disney within a few days which took most families 5 years or more to save for.
Money greed is all it is now!!!
disney greed is not up to the consumer. its should all be based on supply/demand on their side. in theory the price would change with demand to maximize revenues. disney raises the price, the consumer pushes back by lowering the demand. if disney is too expensive dont buy. i think chapek is telling the consumer to buy more merchandise to offset ticket price increases. but all of the prices are going up and i suspect not all of it is related to real costs. disney parks revenue went up 72% over the same quarter last year, so disney is forcing the consumer to pay more for the same product. the best way to give chapek the finger is don’t buy the product. not enough of the stock holders complained at the last election so chapek got renewed.
Wonder what they’d see if they decreased the prices? I think people are just trying to get it in before it’s completely out of their reach…or gone completely with the way this guy is running things. What he sees as high demand may actually be, “oh crap!”.
Think about what the guy is saying here. The price increases are the guests’ fault. You like us so much we are going to punish you for that. What bothers me isn’t the price increases, per se. It is the fact that no where in this story does Chapek say anything about what the guests have had to put up with in visiting Disney parks. No where does he say that Disney will invest in the guest experience to make it better for their customer. What do you think Disney’s board will do in response to the massive profit increase? They will reward Chapek. And what will be his thank you for making that possible? Open YOUR wallet and fork over more money. Intuitively this makes no sense: When you come we will punish you. If you stay home we will reward you. I think, eventually, people will find they can get more vacation for their buck elsewhere. Enjoy the long lines. They are about to get longer and more expensive. Call me Mr. Doom and Gloom. But the numbers don’t lie. And don’t forget to follow the money.
James – you are not Mr Doom and Gloom, you are Mr Spot On.
Thanks Bob! Here’s one less on your demand equation. Continue to turn Disney Wold into the elitist club.
Bigger profit due to inflated pricing for the sane items people bought last year. Duh
Just because they believe that they “can” continue to raise prices does not mean that they should! A Disney vacation is a sacrifice for probably the largest number of people who go there. I have always been a big Disney fan, but it leaves a sour taste in my mouth when they just continue to raise the prices more and more. How about thanking your guests by having more perks or price breaks instead?