There's a little more elbow room at Disney's (NYSE:DIS) massive Florida resort. Attendance declined at Disney World in three of the four calendar quarters in 2016, and this year is also shaping up to be a challenge.
Higher ticket rates, a lack of major new attractions, and a shift to tiered pricing are hurting guest counts. Disney prides itself on its massive resort offerings that keep tourists close, but it surprised investors with a decline in occupied room nights in its latest quarter.
Investors have soured on Disney stock lately, sending it to an eight-month low earlier this week. We're now weeks away from concluding the seasonally potent summer period, Disney's fiscal fourth quarter that wraps up at the end of September. Disney obviously doesn't want to close out fiscal year 2017 on a sour note, so let's go over a few of the things that the House of Mouse is doing to get guests back into its parks.
1. Halloween starts tonight
Disney World is hosting the first Mickey's Not-So-Scary Halloween Party tonight. It opens the Magic Kingdom up to reasonably costumed guests for a night of trick-or-treat candy stations, themed shows, and unique character meet-and-greet opportunities. It's a separately ticketed event, setting guests back at least $74 apiece for the evening.
Disney has historically started Mickey's Not-So-Scary Halloween Party in September, but it's trying to get an extra week out of the family friendly event this time around. This obviously gives the quarter a couple of extra nights of party revenue, possibly juicing hotel bookings during a typically quiet weekend when summer vacationers have already headed home.
2. Food & Wine also gets an early wake-up call
Another popular seasonal event that's getting pushed into August is the Epcot International Food & Wine Festival. The event features food samples and drink options from around the world in kiosks throughout Epcot's World Showcase. It runs all day, available to guests with regular park admission.
Food & Wine had a record 62-day run last year, and it started in mid-September. This time it's stretching the festival into a 75-day affair. This move will have a bigger impact than Mickey's Not-So-Scary Halloween Party, since Disney is nearly doubling the number of days that the festival will be happening during the fiscal fourth quarter. Anyone that has seen the long lines of guests paying premium prices for food and libations knows that this tweak should translate into a healthy spike in incremental revenue for Disney's theme-park segment.
3. Passholder discounts inch higher on in-park buys
Disney typically sweetens the pot for annual pass holders by offering discounts at some park restaurants and stores. It's typically a 10% price break at select locations. It decided to kick things up a notch late last year, widening the places offering discounts and pushing some price breaks as high as 20%. The move was done under the wrapper of celebrating 45 years since the opening of Disney World, but it's also conveniently happening after Disney had a rough year at the turnstiles.
These discounts have been happening since the fall of last year, but over the summer Disney decided to make things even more compelling by pushing the markdowns to 30% at a handful of higher-end resort hotel eateries. The move should get passholders to explore the adjacent Disney hotels, possibly booking stays there in the process. The discounts all end on Sept. 30, just as the fiscal quarter and year conveniently come to a close.
4. Be an ambassador
A day at the park isn't cheap, but Disney's hoping that it can make things cheaper for friends and family members of annual passholders. Disney introduced a one-day park-hopper ticket for $79 two weeks ago, a ticket that includes access to all four of Disney World's parks in any given day. The ticket can only be purchased at the park entrance by passholders the day that they will be used. A one-day park-hopper can cost as much as $142.50 this time of year.
The new $79 ticket will give Disney regulars a chance to share their zeal for the resort with non-passholders, an ambassadorial move that may inspire new passholders. It's clever, but more importantly for our purposes, this promotion also happens to end just as Disney's fiscal quarter and year end at the conclusion of September.