I have been a Disneyland annual passholder for 17 years, two of which I actually had the “fancy” Premiere pass that allowed entry into both Disneyland and Walt Disney World Resorts. I am also a Disney Vacation Club, D23, and Disney Movie Club member. I subscribe to Disney+, the company’s new streaming service, am a proud Disney Visa Card holder, and most of my house is decorated with Disney, Pixar, Star Wars, and Marvel themed items. If you can’t tell already, let me make this clear: I love Disney.
Am I wealthy? Heavens no! But my husband and I both appreciate the value of the Disney brand and what we get from it across its many franchises and businesses. Therefore, the disposable income we do have is prioritized accordingly. This is no different than those that set aside money each week to go to bars, restaurants, dancing, or even the movies. So, what happens each year when Disney raises its theme park prices like they did just this past week on February 11? What do people do when they remember paying $349 for a pass back in the day that is now $1,449? Despite the ranting and raving from many online, like many others, we pay it of course. Why? Brand loyalty.
And while this is a state of mind that most, if not all brands, seek to obtain with customers through their marketing strategies, can loyalty actually cause issues for some brands? Have devote Disney fans like myself finally exposed that this state is not always all it’s cracked up to be?
Why are Disney fans so loyal?
To understand Disney fans’ willingness to pay such “outrageous” prices, we must first understand why they have become such brand loyalists in the first place. While I could go on and on about my personal experiences that have led me down this path, there are many journalists and bloggers that have explored this same topic.
Several years ago at a conference Tom Boyles, Senior Vice President, Global Customer Managed Relationships at Disney Parks and Resorts, highlighted the seemingly infinite number of ways consumers can interact with the Disney brand – 11.2 billion combinations at Walt Disney World alone (Adamson, 2014). He then went on to emphasize how important it was to make each of those moments relevant to each individual person. This way, there is always something for everyone to enjoy. In fact, many of the magical moments experienced by guests have been made possible because of the effort and resources Disney has put toward listening to its guests.
As a former Disneyland Resort Cast Member, I can tell you that storytelling is an integral component in every single part of Disney’s business. Interestingly, this has also been highlighted as a cornerstone to Disney’s success with consumers.
This emphasis on storytelling allows Disney to connect with its customers and guests on a much deeper emotional level, again increasing brand loyalty (Poblete, 2019). In fact, when MBLM, a leading brand agency, released their Brand Intimacy Study in 2019, Disney took the lead as the #1 brand above brands like Apple and Amazon. In MBLM’s (2019) press release it states that “Disney continues to dominate through its associations with nostalgia and the strong bonds it builds with both men and women and across a variety of age groups” (para. 2). Mario Natarelli, MBLM managing partner, is also quoted saying, “We know that customers who form strong emotional bonds with brands are willing to pay more and are less willing to live without them. Insights from our annual ranking of brands are providing lessons and new strategies for business leaders and marketers… Our demand for escapism and our collective need for a distraction from reality is factoring heavily in the brands that rose in 2019.”
In addition to the emotional connection storytelling brings to brand loyalists, it also allows Disney to leverage multiple touchpoints with these consumers, further immersing them in the brand (Burns, 2015; ReferralCandy, 2017; Tennant, 2020). After all, when you have a strong storyline like Disney’s Frozen, Disney fans can further connect with Elsa through merchandise and in-park experiences like the Frozen Ever After attraction, Frozen performances, and personal meet and greets with the queen herself.
Why is Disney raising prices?
Now let’s switch gears back to the juicy and somewhat controversial topic – Disney raising its theme park prices.
As much as I hate to admit it, I know for a fact that Disney brand loyalist annual passholders are, in part, to blame for these price hikes. In fact, over the years there have been a number of articles that have pointed out that the super bloom of annual passholders has greatly impacted the Disney park-goer experience (Frost, 2014; Niles, 2018; Salamon, 2018). Negative impacts cited range from the immense crowds that lead to a packed Main Street and 6-hour attraction wait times, to the apparent sense of ownership that some annual passholders give off, leaving some regular guests feeling almost inferior.
According to The Washington Post, in an earnings call last year Disney CEO Bob Iger acknowledged the need to raise prices. Iger said, “We know that crowding can be an issue and that when our parks are the most crowded, the guest experience is not what we would like it to be… So, we’re leveraging the popularity to obviously increase pricing and to spread demand to get much more strategic about how we’re pricing” (Sampson, 2020, para. 9).
Basically, this means that Disney needs to try to decrease demand to help maintain the quality experiences in the park. It needs to make park going less attainable to ensure it can keep delivering its promise of magical moments to guests (made difficult by annual passholder crowds), which I can fully appreciate and respect. After all, people do not expect clothing brands like Armani or Versace to lower their prices and still provide the same quality as their top-tier products, right?
Other factors likely contributing to the price hikes are all the new projects across Disney Resorts, such as newly opened Star Wars: Galaxy’s Edge and upcoming Marvel Avengers Campus. After all, Galaxy’s Edge alone cost over $1 billion to build (Thompson, 2019). Operation costs have also increased due to social and government pressure for Disney to raise Cast Member wages, which now currently stands at $15 to start (Meyersohn, 2018).
While there are many opinions about how Disney “should” handle these issues, clearly they believe that raising prices can help cover costs and address the crowd issues. And, considering we are not privy to all the ins and outs of the business, I have to believe that Disney’s highly experienced leadership knows what they are doing better than the rest of us.
Lessons to learn from Disney fans
Disney will continually deliver quality experiences for its guests that utilize storytelling to engage them on an emotional and intimate level across various interactions. Therefore, I have little doubt that truly loyal Disney fans will be swayed by recent price hikes. While crowds may lighten a bit, annual passholder will continue to appreciate the quality experiences the brand offers and so crowds will likely remain a challenge as it has been for a number of years now (Barro, 2019; Munarriz, 2018).
With this in mind, while brands everywhere can only hope to create such intensely loyal customers and fans, they should think through the possible repercussions of such loyalty. What would happen if only intensely loyal Apple customers always bought out Apple’s stock of its newest product and it was impossible to keep up with demand due to some limited resource? What if Nike’s sneakers were never able to be experienced by new consumers because brand loyalists always beat them to the punch because of a loyalty program that provided early access?
What feelings might this create to anyone outside this brand bubble? Does it stop the brand from expanding its consumer base? If that is the case, does that matter? As Disney has taught us, these are all important marketing and business decisions to consider when aiming to create a solid loyal consumer base.
As for me, I’ll continue to use my disposable income to maintain my Disney brand loyalty and I am looking forward to my next outing to the park. 😊
References
Adamson, A. (2014, October 15). Disney knows it’s not just magic that keeps a brand on top. Forbes. Retrieved from https://www.forbes.com/sites/allenadamson/2014/10/15/disney-knows-its-not-just-magic-that-keeps-a-brand-on-top/#369b03335b26
Barro, J. (2019, November 20). Disney says it raised park ticket prices to improve your experience. It worked for me. Intelligencer. Retrieved from https://nymag.com/intelligencer/2019/11/disney-is-raising-park-ticket-prices-for-your-own-good.html
Burns, W. (2015, June 9). Disney proves that profitable marketing is about brand stories. Forbes. Retrieved from https://www.forbes.com/sites/willburns/2015/06/09/disney-proves-that-profitable-marketing-is-about-brand-stories/#6e2b0e6d227b
Figueroa, J. (2020, February 11). Breaking: Disneyland resort rolls out ticket price increases ahead of Marvel Avengers Campus opening. WDW New Today. Retrieved from https://wdwnt.com/2020/02/breaking-disneyland-resort-rolls-out-ticket-price-increase/
Frost, J. (2014, May 19). Disneyland has an annual passholder problem. The Disney Blog. Retrieved from https://thedisneyblog.com/2014/05/19/disneyland-has-an-annual-passholder-problem/
MBLM. (2019, February 14). Disney overtook Apple for first time in MBLM’s Brand Intimacy 2019 Study. MBLM. Retrieved from https://mblm.com/press-releases/disney-overtook-apple-for-first-time-in-mblms-brand-intimacy-2019-study/
Meyersohn, N. (2018, July 27). Disneyland agrees to pay its workers $15 an hour. CNN. Retrieved from https://money.cnn.com/2018/07/27/news/companies/disneyland-workers-pay-15-an-hour/index.html
Munarriz, R. (2018, February 11). 3 reasons you’ll pay Disney’s higher ticket prices. The Motley Fool. Retrieved from https://www.fool.com/investing/2018/02/11/3-reasons-youll-pay-disneys-higher-ticket-prices.aspx
Niles, R. (2018, June 5). Does Disneyland have too many annual passholders? OC Register. Retrieved from https://www.ocregister.com/2018/06/05/does-disneyland-have-too-many-annual-passholders/
Poblete, J. (2019, August 22). There’s ‘emotional power’ behind the Disney brand. Disney Examiner. Retrieved from http://disneyexaminer.com/2019/08/22/theres-emotional-power-behind-the-disney-brand/
ReferralCandy. (2017, June 23). 4 secrets behind Disney’s captivating marketing strategy. Medium. Retrieved from https://medium.com/the-mission/4-secrets-behind-disneys-captivating-marketing-strategy-674f3e7257a2
Salamon, A. (2018, November 14). Are annual passholders ruining Disneyland? Disney Information Station. Retrieved from https://www.wdwinfo.com/disneylandcalifornia/are-annual-passholders-ruining-disneyland/
Sampson, H. (2020, February 13). Disney just increased ticket prices again. It won’t be the last time. The Washington Post. Retrieved from https://www.washingtonpost.com/travel/2020/02/13/disney-just-increased-ticket-prices-again-it-wont-be-last-time/
Tennant, D.B. (2020). 4 strategies Disney uses to create freakishly loyal customers. Neil Patel Blog. Retrieved from https://neilpatel.com/blog/create-freakishly-loyal-customers/
Thompson, S. (2019, June 3). ‘Star Wars: Galaxy’s Edge’ merchandise And memorabilia being resold on eBay for sizeable profits. Forbes. Retrieved from https://www.forbes.com/sites/simonthompson/2019/06/03/star-wars-galaxys-edge-merchandise-and-memorabilia-being-resold-on-ebay-for-sizeable-profits/#3492d92a448c
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