Disney will welcome its first official guests onto its newest cruise ship this week. This comes one week after Disney’s theme park and experiences segment posted yet another dominant financial report.
Disney reported record income from its Disney Experiences segment, which includes the theme parks and cruise line. Disney Experiences accounted for the majority of the company’s operating income in the latest quarter and fiscal year, once again demonstrating that theme parks and experiences are the financial engine powering The Walt Disney Company.
The new Disney Destiny cruise ship shows why some fans continue to be willing to spend more for the Disney experience. I sailed on a press preview of the ship from its Ft. Lauderdale, Florida, home port last week. It’s Disney’s third Wish-class ship and even more handsomely decorated than its predecessors, Wish and Treasure. With a “heroes and villains” theme, character encounters abound — from a new, Broadway-style adaptation of “Hercules” that’s even better than the 1997 Disney film, to the smaller-scale, up-close magic tricks of Dr. Facilier’s Parlor.
None of the Wish class ships will make it to Southern California. But the fleet’s expansion in Florida will allow Disney to send its older, smaller ships to spend more time sailing from San Diego, starting next year.
Yes, sailing with Disney costs more than on many other cruise lines. But Disney Signature Experiences President Joe Schott told me aboard the ship last week that the cruise line enjoys the highest customer satisfaction ratings of any Disney experience around the world. Clearly, there is demand for a cruise line that offers family-friendly immersive storytelling without casinos and cocktail packages.
To its credit, Disney at times does offer discounts, including the annual early-year resident discounts on Disneyland tickets. But fans arguing that something has to give at Disney have been waiting a long time for an across-the-board price correction. They will continue to wait — perhaps forever.
There remains plenty of money in the U.S. economy, which continues to grow. It’s just that money is concentrating in the hands of a smaller number of households, rather than being shared by all. If you are not among the wealthy who are getting richer, yeah, it’s tough not to feel like you are getting squeezed out of visiting Disney.
So long as companies such as Disney can chase America’s money by serving the wealthy, they will. The only thing that would compel Disney to offer more discounts, or even price cuts across the board, would be another company entering the market to offer Disney-level experiences at lower prices.
With stronger competition from Universal in Orlando, Walt Disney World offers cheaper annual passes with more benefits than Disneyland’s Magic Key. Maybe if Universal got into the cruise business, as has been talked about within that company, fans might see more discounts at Disney Cruise Line, too. Disney has found a powerful formula for making money in a tough economy. The question is: Why aren’t more entertainment companies copying it?