Fans of pointing out the sticker shock of a visit to Walt Disney's (DIS -0.87%) largest theme park resort got some fresh ammo last week. The debut of Star Wars: Galactic Starcruiser -- an immersive two-night lodging experience that starts at roughly $1,500 per person for a family of four -- arrived with Tuesday's "maiden voyage" at Florida's Disney World.
The early reviews from paying customers have been generally positive, but it's not as if the bar has to be high for the high-end Star Wars-themed adventure to be a sold-out success. There are just 100 cabins available on Star Wars: Galactic Starcruiser every two nights, or less than 0.3% of the total available rooms at the resort's more than two dozen resort hotels. Even if every bed and bunk were spoken for on the new big-budget experience, it would still be just 0.1% of the number of guests that clicked through a turnstile at one of the resort's four theme parks in pre-pandemic times.
Prices are inching higher on hotel rates, admissions, and concessions, but Disney is not alone with an itchy trigger finger on the pricing gun. A controversial premium queue platform that rolled out at Disney World in the fall is also another pressure point for diehard fans, but the media giant is only following the product map that most of its rivals have been cashing in on for years. Disney was never cheap, but is it now too expensive? If it's not there yet, is it close to the tipping point? Let's talk about when we will all agree that the House of Mouse has gone too far.
Image source: Disney World.
It's a world of laughter, a world of tears
Disney obviously isn't the only one bumping prices higher in the new normal. SeaWorld Entertainment (SEAS -1.40%) increased pass prices at its Florida parks last month. Universal Orlando parent Comcast (CMCSA -1.91%) pushed out increases of 11% to 15% for all of its annual passes last week.
If you may have missed these inflationary headlines detailing the higher costs of being a regular at one of Disney World's rival attractions, it's just because it's so much easier to write about the moves at the world's largest theme park operator. Unlike SeaWorld and Comcast, Disney World didn't jack up its pass prices this year. In fact, it's not even selling most of them right now. Demand is so high that Disney is only selling a seasonal pass available to Florida residents that limits admissions to weekdays during non-peak periods.
This is a good time for the industry. Escapism is currency, and folks aren't flinching at the higher prices that the proprietors of gated getaways are charging. SeaWorld Entertainment, Comcast, and Disney all posted record or near-record quarterly results this earnings season. If we're asking when Disney's pricing moves have gone too far, the obvious answer is when guests are no longer willing to pay. We're not there just yet.
If the Genie+ platform where folks pay for access to faster-moving queues is the measuring stick for Disney going too far, Disney said during last month's earnings call that a third of its guests are paying for the advantage of time to do more at Disney's four theme parks. During peak travel periods Disney is seeing half of its guests paying up to let Genie+ out of the bottle.
If last week's launch of Star Wars: Galactic Starcruiser is the gauge for Disney World charging resort guests too much, the majority of its excursions until July are fully booked. You can complain about rising food prices or potentially shrinking portion sizes, but the eateries remain busy. Folks are still lining up at the registers of park shops that offer vacation keepsakes and other commemorative trinkets.
None of this means that Disney isn't cheap. The prices are clearly high, and out of reach for most families. However, with the parks crowded, registers ringing, and guests paying for premium-priced offerings and experiences, we're not at the point where supply has overplayed its hand in this game against demand. Disney is still rolling as one of the many leisure stocks flexing its pricing elasticity. The flexibility won't always be there, but for now Disney is winning.
