Inventory: Six Highlights of Global Theme Park Development in 2018
In 2018, theme parks created new loyalty plans and pricing schemes, and expanded the park to further increase employees'wages. Some park operators have changed their business, while others have been trying to meet the needs of tourists. The following are some highlights of the development of theme parks in 2018.
For a business full of surprise and joy, the trend of theme parks is usually predictable: adding new amusement facilities, expanding the size of the park and rising prices (almost inevitable).
Over the past year, we've seen a lot of news like this, as park operators try to encourage returnees while bringing in higher revenue.
Given that Liuqi Group has signed an open park agreement in China, international development is expected to continue; Disney has announced plans to invest $2.5 billion in the expansion of Disneyland in Paris; and it is reported that the budget of Beijing Universal Studios, which will open soon, has doubled.
In addition to the expected increase, other large operators in the industry continue to develop in other areas. The following are the development of the six major theme parks that attracted attention in 2018:
SEAWORLD Business Transition
2018 is the bottleneck of the ocean world, and the company is in so-called trouble within five years of the release of the documentary Blackfish.
The Ocean World has tried to reverse this situation, including replacing the top leadership, eliminating killer whale fishing and shifting the focus of services from animal entertainment to recreational facilities, but without success.
So in February, the board of directors of Ocean World decided to try a new approach. Its CEO, Joel Manby, resigned this year after three years in office. Executives such as the COO and CMO recruited by Manby also resigned in the coming months. John Reilly, a veteran in the theme park industry, was appointed interim CEO, but he is still responsible for major corporate decisions. Earlier this year, he said the ocean world needed to focus more on its salient feature: animal shows. But the company should try other strategies, such as offering free beer in some parks in the summer (peak season) and lowering ticket prices.
The company also broke legal barriers and agreed to pay the SEC $4 million in September to settle fraud charges related to comments on the impact of the Black Whale incident. Another U.S. Department of Justice investigation has yet to take any action.
Ocean World seems to have momentum because in November, the company said that visitors to Paradise and revenue had been rising for four consecutive quarters.
Universal Pictures is about to open a new Orlando Theme Park
The battle between Disney and Universal Pictures over Orlando Theme Park has been going on for decades, and there is still no sign of easing. In fact, both companies are increasing their competition by investing heavily in attractions, expansion and hotels.
Observers have long been expecting Comcast's Universal Park and Resort to open new parks in Orlando, bringing the number of Orlando parks to four, including Volcano Bay, a "water theme park" that opened in 2017. But Universal Pictures has remained silent about the plan even as executives announced plans to increase Nintendo theme areas and acquire more land for existing properties.
The July earnings call broke that silence. In response to analysts'questions, NBC Global CEO Stephen Burke said the company was "considering" another Florida Park and confirmed that it had submitted its name for registration. "We have a lot of intellectual property," Burke said. "We love the theme park business, which is one of our best and most consistent businesses, and we think we have a lot to do. Opening a new park in Florida will help transform Florida from a two-to-three-day destination to a possible one-week destination."
Now, this speculation has new concerns: the official announcement time of New Paradise, the recreational facilities included, and the opening time. Walt Disney World will upgrade its services at its 50th anniversary in 2021. There is no doubt that the battle for theme park enthusiasts will continue to grow at a high speed in the foreseeable future.
Disney agreed to raise the starting salary to $15 an hour
This summer, the so-called happiest place on the planet caused strong dissatisfaction among employees, and then the union representing Walt Disney World employees in California and Florida negotiated a new labor contract with Walt Disney.
Disney employees marched to protest against pay levels. A union-commissioned study found that nearly 75% of theme park employees in California did not receive adequate basic salaries.
Faced with this pressure, Disney signed a new agreement to raise the salaries of employees in California and Florida to $15 an hour by January next year and by 2021, respectively. Trade union leaders said employees agreed to the plan, which was revolutionary for Disney employees and employees of other hotel companies.
In Orlando, Universal Pictures and Ocean World also announced that they would raise their starting salaries, but not as much as Disney.
Six Banners Paradise launched the industry-leading loyalty plan
Traditionally, theme parks don't play loyalty plan games like airlines, hotels and restaurants, but the Texas-based regional theme park operator Liuqi Entertainment Group announced its new loyalty in August.
Tourists who spend in parks, experience recreational facilities, watch performances and participate in surveys can get points through the membership Award Scheme of Six Flags Paradise. The awards cover lucky fruit, free tickets and VIP travel.
Only those who participate in the Six Flags membership program can get and exchange loyalty points. This program allows them to enter parks and get welfare passes. Six Banners Group has been striving to increase the number of members and make the membership plan more valuable, and executives hope that the incentive scheme can ensure that members always participate in it, and regularly repeat visits to Paradise for consumption.
Industry observers say the plan is long overdue. The question now is how the plan will work for Six Flags and who will try their own version next.
Disney launches special fares on specific dates
Since Disney began to implement its seasonal pricing policy in 2016, that is, to raise ticket prices during the peak season of the year, the theme park industry has been waiting for Disney to develop a more targeted pricing strategy.
Finally, in September this year, the entertainment giant announced that it would link the ticket price of Walt Disney World Park to the specific date for the first time. According to this change, the maximum price of one-day tickets has not risen, but the lowest price has risen.
Disney's strategy shows that although theme park operators do not adopt airline-style revenue management schemes, pricing procedures will become more and more complex. Once prices are based on consumption history and forecasts, there will be no further fluctuations. Disney said the goal of this pricing strategy is to better manage tourists and keep the number of tourists equal throughout the year, instead of dividing them into peak seasons such as summer or holidays.
Disneyland wrote on its official blog: "The introduction of date-based tickets and prices will enable us to better distribute visitor arrival rates and thus continue to improve and provide better experience."
Dubai theme park is still disappointing
After Dubai Paradise and Resort failed to meet their admission targets in 2017, its operator DXB Entertainment Group restructured its debt and lowered its target for 2018. Although the number of tourists increased, the company still failed to make a profit. The company reported that it had lost 20 consecutive quarters in November this year, so the business development plan of Paradise is still under review.
Six Flags Entertainment Group signed an agreement to open a theme park in Dubai as part of its development plan, but in October, the group warned at a financial conference that the New Park might not open as planned in 2019.
Jim Reid-Anderson, chairman and CEO of Liuqi Group, said: "Although we don't want the development process of Paradise to stop here, if it does, we need to work hard to overcome this problem."
Theme park operators all over the world are looking to the international market to develop their business. Six Banners has cooperated with Park developers in China, Saudi Arabia and Dubai, and Disney and Universal Studios have recently made large-scale investments in China.
Dubai's plight clearly shows that global growth is not guaranteed. "If you build it, people will come." The phrase may sound true in baseball movies, but it may not apply to theme parks.