Disney Just Made Hundreds of Millions of Dollars at Your Expense
Yes, Disney has raised prices again. Stop me if you’ve heard this one before.
I realize many of you are seeing red right now, and I’m right there with you on this one.
I’m visiting in a couple of weeks, which means the cost of my trip just went up. So, I feel your pain.
Here’s what we all need to know about the most recent price increases.
Photo: Getty
In short, Disney just made hundreds of millions of dollars at your expense.
What Just Happened at Disneyland?
The short answer is that the cost of Disney Genie+ and Lightning Lane just went up substantially.
Photo: Disney
I’m not gonna bother sugarcoating this one. It’s a greedy move by Disney, one I’ll explain in the final two sections.
Since you’re not a corporation trying to squeeze every penny out of customers, you don’t care about that part.
Photo: skillastics.com
All that matters is how this impacts you. Honestly, it’s not great.
The cost for Disney Genie+ just increased by $5 or 25 percent. One day of Disney Genie+ now costs $25 per adult. Somehow, that’s not even the worst part.
Disney has changed the language on the site to reflect that the price starts at $25. However, it could increase on certain dates.
Yes, Disney has changed Disney Genie+ into a surge pricing system. Presumably, the price will go well above $25 for Thanksgiving and Christmas this year.
So, the cost of the vacation you’re planning for the next two months just increased in price, and I cannot tell you the exact amount.
As a concession, Disney has switched WEBSLINGERS: A Spider-Man Adventure to Disney Genie+ service, which is nice.
Photo: Disneyland
Until today, WEBSLINGERS has remained a Lightning Lane attraction at Disney California Adventure. You no longer need to pay extra for it.
Disneyland has also increased some (but not all) ticket prices and some parking.
As the LA Times notes, Disney officials can justify this one. The increased prices on some tickets are in the 9-11 percent range, while inflation for the past year was 8 percent.
Still, preferred parking went up by $5 to $50. Meanwhile, the highest-demand ticket dates increased from $164 to $179.
Photo: Disneyland
Multi-day tickets during popular times of the year also cost as much as 12 percent more now. It’s a comprehensive price increase, folks.
What Just Happened at Walt Disney World
Disney raised prices at Walt Disney World as well. From a percentage-increase perspective, these changes are even more extensive.
The primary takeaway is that Disney Genie+ and Lightning Lane have adopted a “variable pricing system.”
What does that mean? The price of Disney Genie+ will range from $15-$22 in October. So, the price had been $15 already and is now variable.
Photo: Disney
The same Disney Genie+ purchase could cost up to $7 per person per day more now.
Universal Orlando Resort has used this approach with its version of Lightning Lane, Universal Express Pass, for many years now. It’s a new approach for Disney, though.
Photo: Disney
Presuming that you’re price-sensitive, you must now check the My Disney Genie app to know the price for Disney Genie+ on a given park day.
Disney had already taken the same approach with its Lightning Lane attractions. Their prices vary depending on the date.
Unfortunately, rides like Star Wars: Rise of the Resistance are likely to have price increases later this month.
To the best of my knowledge, a Lightning Lane had never cost more than $20. Now, $22 is possible on some October dates.
Credit: Disney
I’m speculating here, but I doubt we’re seeing the top-end pricing yet. Thanksgiving and Christmas are two of the most crowded times at the parks.
I strongly suspect that Disney Genie+ and Lightning Lane costs will max out during those holiday weeks. That’s when we’ll know the current price ceiling.
Credit: Disney
I realize that you have many questions here. So, I’ll strongly recommend that you speak with an Authorized Disney Vacation Planner at MickeyTravels for your next trip.
As always, these agents won’t charge you anything for their services, and they understand Disney pricing better than anyone else.
Photo: Katie Hill/MickeyTravels.com
Why Did Disney Do This?
I’m going to go off the board with an answer you didn’t expect here. This choice likely has little to do with the parks.
We’re only three weeks away from Disney’s next quarterly earnings report.
At that time, CEO Bob Chapek and CFO Christine McCarthy will discuss the annual revenue at The Walt Disney Company.
I have expected good news here, as record profits have become a quarterly announcement in 2022.
Photo: CNBC
However, Chapek and McCarthy just added a new voice to Disney’s Board of Directors, the puppet voter of activist investor Dan Loeb.
Effectively, Disney bought him off so that he’d quit complaining about the company’s business practices. The price was one out of 12 seats on the board.
Photo:NY Times
Now, we have someone new and motivated providing advice – he’d say “guidance” – on maximizing profit. And that usually starts at the parks.
While you and I are irritated every time the price of a Disney vacation increases by even a penny, the meta-perspective tells a much different story.
Photo: CNBC.com/Getty
Disney attendance didn’t drop during late August and September, as it ordinarily does.
Overall, American parks haven’t dipped much at all in 2022. While their status could always change, the reality is that customers view Disney parks as good value.
As long as that philosophy remains, Disney can charge whatever it wants at the parks, especially on the allegedly optional amenities.
So, executives can argue that they haven’t increased prices for everyone.
Photo: Visit Orlando
Did Disney Increase Prices for Everyone?
Yes. Technically, the consumers impacted the most are the ones buying the “add-ons,” Lightning Lane and Disney Genie+.
Of course, we know that more than half of park visitors do so, which makes that a ridiculous assertion. Also, it doesn’t address food and drinks.
Everyone eats and drinks at Disney. Ergo, it’s safe to say that the price increases impact everyone.
This price increase isn’t a massive one by any stretch. Instead, it’s one of the subtle, insidious ones we’ve tracked during the Bob Chapek era.
Photo: Charles Krupa/AP
We know that 50 percent of guests use Disney Genie+, just as we’re aware that 55,000 guests visit Magic Kingdom daily.
At that park alone, another $7 per person using Disney Genie+ would generate $385,000 daily. Over the course of a year, that’s $140,525,000 in revenue.
Yes, Disney just quietly increased its revenue at Magic Kingdom alone by $140 million!
Across Disney’s six American theme parks, these moves could net more than $800 million…and that’s not even the most noteworthy part.
All the revenue we’re discussing is pure profit. Disney had already established the baseline for operating these digital services.
All additional price movement happens above the breakeven point on cost.
For this reason, I don’t even think of this as Disney raising prices. Instead, it’s Disney taking an additional profit of $800 million or so annually.
So, those record theme park prices we discuss every quarter should go up by another $200 million per quarter. And it comes out of your pocket.
