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Sunday, April 6, 2014

A historical view of MK ticket prices

Click for a larger view

Back in February, Disney announced the next round of price hikes for park tickets.  Today a one-day, one-park (ODOP) ticket for the Magic Kingdom is $99.  Given that this price increase came in February, it's entirely possible (and, sadly, not unprecedented) that another price increase may come later in the year.

Thanks to the folks at AllEars.net, we can take a look back at the Magic Kingdom ticket prices since 1982 (that's when the old ticket books went away completely and regular park admission started).  Looking back at 1982, a Magic Kingdom ODOP ticket was just over $13, a mere fraction of today's price.  If you look at the chart above you'll notice that prices rose fairly steadily until the late 1990s.  When Bob Iger became Disney's CEO in 1999, a Magic Kingdom ODOP was $44 - more than four times what it was seventeen years earlier.  Now, in 2014, that same ODOP ticket is $99, more than double what it was just 15 years ago. 

Now I understand costs do go up each year, but what I'm most concerned about is Disney's pace of increase.  If you look at the trend line (the black line), you'll see that from 1982 to around 1992, the ticket price was just slightly above the trend, but pretty close.  From 1992 until 2002, ticket prices dropped below the trend line.  In 2003, that's when things really started to change.  Notice the general slope of the ticket price line starting in 2003 - it's much steeper than it had ever been.  That meant the price of tickets started increasing at a greater rate than before, and for the most part that new slope hasn't relaxed.

In the small chart above, you can see the percentage change of ticket prices from year to year.  After 1999, the percentage of change has been quite volatile, from no change to as much as 12-percent.  Granted, the economy over the last few years has been anything but stable, so I guess it's not much of a surprise to see volatility in Disney's pricing structure.

So what's the point behind all this?  Using a tool like this, we can attempt to predict what prices will be in the future.  Given this rate of increase at around 6% a year, we can expect a Magic Kingdom ODOP ticket to run around $105 next year (that is if they don't already do another price increase this year), and could be around $140 by 2020.  Stop and think about that -- by the time the Magic Kingdom celebrates it's 50th anniversary in 2021, a one-day one-park ticket will be ten times what it was just after the Magic Kingdom's 10th anniversary.  I can't think of too many things that cost ten times what they did about 40 years ago.  If gas prices followed the same rate of increase then one gallon of gas will cost $13 by 2020. 

Maybe now you'll see what I'm concerned about -- Disney pricing themselves out of business.  There will come a point when the average family will no longer see the overall value of a Disney vacation.  I know some are already wondering if it's really worth it.  Sure, the parks are packed and attendance is still strong right now, but it doesn't take much to change all that.  Would you still drive a car if gas cost $13 a gallon?

I'm not griping about ticket prices.  Yes, they're too high, but that's not my main point.  My concern is the value of a Disney vacation.  I want people to be able to afford a Disney vacation.  I want the average family to be able to enjoy the magic.  I want Walt Disney World and Disneyland to be the premier theme parks in the world and the standard for which all others reach.  The more and more a Disney vacation starts to get our of reach for the average family, the closer Disney becomes to developing a reputation as something for the elite only.  Walt was never an elitist and I think he'd never want his parks to become something only for the elite. 

I understand prices have to increase, i just hope Disney will realize that their prices are going up too fast and will slow down that rate of increase. 

1 comment:

Luke Hempenstall said...

Chuck, you make a very important point. The ever increasing cost of tickets at Disney is definitely a concern for families wanting to travel to WDW. Particular families like mine, travelling all the way from Australia meaning that thousands have usually already been spent before even reaching WDW.

It would be interesting to see though whether the price increases by Disney have generally been in line with CPI increases. It's easy to look with astonishment and dismay at ticket prices 20 years or even 10 years ago compared to now, but the cost of living is higher now and so generally (and I am generalising here…) have wages and salaries.
I'm not saying that Disney's price increases are in line with the CPI increase but it's a more accurate point of comparison I guess.

As always Chuck, I greatly look forward to your posts each week from one Disney Daddy to another all the way down under here in Oz! Keep up the fantastic work!