Saturday, 31 March 2012

The Future of Disney Parks and Resorts

What would I do if I was Tom Staggs?

I've decided that I am a rubbish blogger. Rather than attempting to get lots of little posts done regularly, I've decided to work on one detailed essay on a topic of my own choice. This quarter I've decided to go with a staple for those in the theme park industry, The Future of Disney Parks and Resorts: What would I do if I was Tom Staggs?

Who is Tom Staggs?

Thomas O. Staggs is Chairman of Walt Disney Parks and Resorts. Staggs has been with Disney since 1990, and rapidly moved up the ladder to Chief Financial Officer and Executive Vice President in 1998. On January 1st 2010 he took up his current role as Chairman of Parks and Resorts as part of an executive job switch with Jay Rasulo who now holds his former position as CFO/EVP. He reports directly to Disney CEO Robert Iger. In his role as Chairman, Staggs is responsible for all Disney theme parks, resorts and cruise lines. Walt Disney Parks and Resorts is the largest Amusement Park Corporation in the world, attracting 120 million visitors to their parks annually (which is approximately 3 times the size of the closest competitors). They operate the 8 largest parks internationally and the 2 largest water parks in terms of annual attendance. They have resorts over 3 continents, and are currently constructing their 12th theme park in Shanghai China. In terms of theme parks, Disney is the big kahuna. In terms of Walt Disney Parks and Resorts, Tom Staggs is the boss.

Why should Tom Staggs (or anyone at Disney for that matter) care what anyone else thinks? Simply put, because Disney cares about good ideas. They know that strong well-constructed ideas were the basis for Disneyland in the first place, and a large part of why it was successful. Now I am not claiming that my ideas are amazing (or even good) but I have come to the realization that I am never going to become an Imagineer. These ideas are of no value to me. I would rather have these thoughts out there being thought about, discussed and ridiculed, than wait for things to change on their own. So let's get into my thoughts!

International Branding

Before I go to deep, I'd like to take a look at Disney Parks & Resorts from a global view. Let's have a look at all of the open Disney resorts internationally. Firstly, the Disneyland Resort in California has 2 parks, Disneyland Park and Disney California Adventure. Walt Disney World in Florida has 4 parks Magic Kingdom, EPCOT, Disney's Hollywood Studios and Disney's Animal Kingdom, and two water parks Disney's Typhoon Lagoon and Disney's Blizzard Beach. Tokyo Disney Resort in Japan has 2 parks Tokyo Disneyland and Tokyo DisneySea. Disneyland Paris in France has 2 parks Disneyland Park and Walt Disney Studios Park. Finally, Hong Kong Disneyland Resort has 1 park Hong Kong Disneyland. There are two things I notice when I look at the names of these parks and resorts. Firstly, they are a mess! Why is Disneyland Paris a resort, but Hong Kong Disneyland a park? Why is Disneyland Park not just Disneyland? The second thing that is obvious to me is that everything is over branded with the Disney name. We get it. It's a Disney park at a Disney resort. My suggestion here is simple. The resorts should have a clear name which is Disney branded. I would prefer to leave the original US resorts as they are; and have the international resorts follow the Tokyo convention. That would give us the Paris Disney Resort and the Hong Kong Disney Resort. The parks at these resorts are a brand-name themselves. They should be Animal Kingdom and DisneySea. People are at the resorts to go to these parks; they don't need to be reminded that they are Disney or Tokyo parks.

Next I'm going to have a deep dive into all of the current and planned Disney Resorts, and give you my views on what's there currently and what I think would be worth investing in for the future. Before I do that I should explain that a number of my suggestions revolve around a similar theme. This is that even though Disney is one of the great international brands, not every park should be a Disney brand park. Disney has a unique opportunity to sell its guests on international experiences of the Disney quality using one of the many brands which Disney own. Now before any fanbois hunt me down, I think each resort should be centred on a Disney park and it should remain a Disney Resort. However brands like Pixar and Marvel have a following of their own which can be used to entice guests to visit resorts they never planned too. Let's take a look at Disney's Resorts.

Disneyland Resort

The Disneyland Resort is home to the most famous theme park in the world, Disneyland. This park is still, in my view, the greatest theme park in the world. Designed by Walt himself, opening in 1955, the park has had almost 600 million visitors. What would I do to improve this park? Nothing. I would spend money in this resort taking pressure off Disneyland by improving its sister park Disney California Adventure. I would up the parks budget for maintenance, and spare it from the whims of Imagineers who are trying to make their mark and increase synergy.

Before I start to dissect Disney California Adventure (DCA), I must say I like the idea but I didn't like the initial implementation of it. I do think that Disneyland Resort needs a second park. While there was a lot to like about WestCOT, I understand why it wasn't built. I must say I don't like the layout of DCA. I've never liked parks that have a main street with a bend. For me it is yet to be determined whether the addition of Carsland and Buena Vista Street improves my view on this park. My recommendation is that this park should become Pixar Park (or Pixar Studios or something to that effect). It already has some great Pixar attractions, Toy Story Midway, a Bug's land, Carsland (by the way, Carsland, why not Radiator Springs?), the Monsters, Inc. Ride, etc. There would need to be changes, and some Disney attractions would need to be replaced, but I believe this would really reshape this park as a major feature of the resort. The whole point is to have a park as a positive alternative to Disneyland. Not everything in the park has to be Pixar themed, area's like Paradise Pier could remain largely untouched, but there is now enough Pixar IP that it could support its own park. I believe this change could be made while the park is in operation. My only condition is that it is not called Disney Pixar Park.

Would I build a third gate in California? Yes, but not for a long time. I would want to see DCA draw in 10 Million guests annually. It currently draws in 6 Million every year, compared to Disneyland's 16 Million. The strategy should be to build DCA capacity, and slow the growth of Disneyland. Given decent investment, DCA should reach 10 Million before Disneyland reaches 20 Million. I don't believe that Disneyland can sustain 20 Million, so there must be some attempt to aid capacity at some point. I believe we will see a large water park (a la Typhoon Lagoon) added to the south west of the current parks in the early to mid-2020s.

Walt Disney World Resort

The 4 parks of the Walt Disney World (WDW) represent half of the 8 highest attended theme parks in the world. The centre piece, the Magic Kingdom, is the world most visited park with approximately 17 Million guests annually. Each of the other parks average around 10 Million guests each year. It also has the 2 most popular water parks in the world, each receiving approximately 2 Million guests annually. Even though it is the most successful theme park resort to ever exist, does not mean that it is beyond questioning. Certainly the size of these parks has led to an organisational structure which has clear inefficiencies as it stands. Rather than worrying about that structure in this essay, I'm going to focus on just what I would do to these parks.

What changes would I make in Magic Kingdom? Believe it or not, I would keep things going along the lines of the recent enhancements. I would want to maintain the current timeless style of the Kingdom, while make subtle changes which increase Rides Per Capita and increase consumer engagement. From what I have seen the Fantasyland Expansion will be a wonderful addition to the park with great attention to detail. For me, nothing less than outstanding attention to detail would fit within Magic Kingdom. I would possible look at adding a couple of crowd-soaking attractions, just to help with the growing park numbers. As with Disneyland, I want more money for maintenance. It is important that Magic Kingdom remain a dream land for visitors from around the world.

EPCOT is a unique park in terms of theme parks internationally. I'm not aware of a park that has a similar range of attractions and style. I know that a lot of people don't like EPCOT or don't understand EPCOT. I should tell you right now, I like EPCOT. I think it is wonderfully designed, and full of rich experiences. I still think that it is in need of large investment. While it currently is the 2nd most popular WDW Park, I think without investment in the next 5 years crowds will be ignoring in favour of the growing Animal Kingdom. In my opinion 3-4 nations should be added to world Showcase. I believe that Disney should have been adding to the current 11 pavilions over the last 15 years, but have not felt it was worth their wild. The nations added (such as Egypt, India, Brazil) should have strong architectural beacons and opportunities for shows, rides and cuisine. This may shock you reading an Australian blog but, no I don't believe Australia should be added. I'll explain why in a minute. Future World is also an attraction or two short, but I'll leave that to wise heads than mine to work out what they could fit in here. My main problem with EPCOT overall is the overriding sense that guests are being advertised towards. There is a strong argument to make some of this a little more subtle, particularly since most younger guests consider themselves to be more advertising savvy.

Let's move onto the newest WDW park, Animal Kingdom. Scrap Avatarland. There I said it! I'm sure it could be amazing, but I can't imagine people will ever feel that it belongs in Animal Kingdom. I am seriously worried that a lot of planning money will be spent on it before the sequels are released. We will then see a period where the whole exercise is questioned on the basis of the success of the sequels. I do want to see the end of Camp Minnie and Mickey. If I was in charge I would plan for two additional lands. Firstly Beastly Europe! Think medieval village with Dragons and other traditional fantasy creatures. This can draw heavily from the plans for the often mentioned Beastly Kingdom. I think giving this land a location would be essential to its success. Secondly, I would add Australia. Here is where our little continent can come into its own. We don't have classy food or unique architecture, but we do have lots of weird looking animals. For me these two additions would make the Animal Kingdom a real magnet inside WDW.

The final park at WDW is Disney's Hollywood Studios (DHS). While this park has some of the strongest individual attractions in WDW, for me it is a disappointment in theming and layout. It always felt like a cheap copy of Universal to me. While we can't do too much on the layout of the park, we can change the theme! My concept for revitalizing Disney's Hollywood Studios is a full site conversion into Muppet Studios. This would be a major task, and I imagine an undertaking this big would require some down town for the park. There are clear ways that some of the major attractions could be Muppetized. For instance, The Rock'n'Roller Coaster featuring Dr Teeth and the Electric Mayhem, and Gonzo presenting the Twilight Zone Tower of Terror. For me the major problems are Star Tours (which I'd move to EPCOT), Pixar Place (which I don't know what to do with), Fantasmic (which would need to be replaced with a new show sadly) and The Sorcerer's Hat (which I love, but I know many people don't).

Closing DHS, even for 3 months, would cost Disney far too much money to consider this as a realistic option. This could only be done if a viable alternative opened to soak up the extra guest numbers, such as a fifth Gate. While a fifth Gate is inevitable in the long term, with the popularity and space that WDW has, it could easily be 20-25 years away if Disney doesn't see any value in it. If I were Tom Staggs, I would seriously be looking at starting planning and development for a fifth Gate over the next 5-6 years. What would be my choice for a fifth gate park? Something different. Something big. Something revolutionary in terms of layout and theme. While there are many possible options for this, my personal favourite would be based on yet another Disney-related brand, Tim Burton. I think a holiday themed park, based on Tim Burton's Nightmare before Christmas would add a new dimension to WDW Resort. While having clearly themed worlds for Christmas and Halloween from the source movie, the potential of having other holiday worlds allows for almost limitless artistic potential for rides, shows and experiences. Using Tim Burton's widely recognisable aesthetic would allow for a park experience of pure fantasy. Perhaps this is far to flimsy pretext for a major theme park, but for fans of his work "Tim Burton's Holiday Worlds of Old" would be a must visit attraction.

What do I think will realistically be the fifth gate? It will probably be a DisneySea style park in about 10-15 years’ time. But it doesn't hurt to dream right?

Tokyo Disney Resort

If ever a Disney Resort needed expansion, it is Tokyo Disney Resort right now. Tokyo Disneyland is the 3rd largest theme park in the world based on annual attendance. Tokyo DisneySea is the largest non-Magic Kingdom style Theme Park in the world on the same basis. The Japanese have an insatiable appetite for Disney. Why isn’t Disney building a third Tokyo gate right now? They have no space! TDR is entirely reclaimed land, and if they wanted to build more, they'd have to reclaim more. I imagine they will wait until attendance reaches about 16 Million per park (currently 12 Million per park per annum), and then build south western side of DisneySea. My view is that then next addition to TDR will have to cater towards the youth market. I'd love to see a tie in with Japanese culture, like Studio Ghibli, although that may be far too costly. Given that DisneySea is such a wonderful unique park, TDR could afford to have a "sequel" of a U.S. park like EPCOT, Studios or California Adventure (I think Shanghai will get an Animal Kingdom, so I don't want to have too much repetition).

What would I do for the current two parks in TDR? Maintain what's currently there, keep the current enhancements going, hope for no devastating earthquakes, and let the good times roll! I could not be more impressed by DisneySea, it looks like an amazing park!

Disneyland Paris Resort

This is quite a complicated question. What do you do with Paris? For my money, the current announced enhancements are more than enough. There is no use sending good money after bad. Paris Disney expanded too early. Walt Disney Studios Park was built because every other resort was getting a second park, not because it was needed. This park is only cannibalising Disneyland Paris attendance at the moment. Only if the current enhancements (like Disney Dreams) make a huge splash could this resort have the potential of the other resorts. In my view it will be at least 10 years before there is need for 2 parks, and at least 20 more years before a third gate could be needed. I have thought about rebranding Walt Disney Studios but I don't think it is worth it in the foreseeable future. At least there isn't a direct Universal-style competitor for this park. It's great that there is room for expansion in Paris, but at this stage there is no point. Sorry to be so pessimistic Europe, but you have no money!

Hong Kong Disneyland Resort

Hong Kong is home to the youngest and smallest Magic Kingdom style park, and the only single park Resort in the Disney chain. Firstly, I would like to say that I am a big fan of everything I've seen from the 2 upcoming expansions. I think they are really on the right track. My problem with Hong Kong Disneyland, even though it is the closest Disneyland to Australia I have no motivation to go there. The last time I was in Hong Kong I tossed up going, and decided it wasn't worth it because I'd seen everything there in Disneyland or WDW. Even the castle is a knock off! Why wouldn't they build a castle for a new princess in Hong Kong?? Anyway! I think the new lands mean that I would visit next time I was in the area. I hope that this will slowly increase the visitor base towards 8-10 Million per annum. I guess that depends how much buy in we are going to get from locals and Chinese nationals from around Hong Kong over the next 10 years.

The good news about Hong Kong Disneyland Resort is that when they reach the 8-10 Million guests mark, they have room for expansion! However, it will come at a cost. There are even rumours that adjacent land owned by Hong Kong Government may be up for sale to the highest bidder (I'm looking at you, Universal). While they may not be able to secure the land, I wouldn't be surprised if there were plans for the second gate at Hong Kong Disney regardless. What it could be is an open question at this stage. If it were me, I'd be planning something brand new for Hong Kong. Disney must be careful that it does not repeat itself between Tokyo, Hong Kong and Shanghai. Fans will be fine with 3 Magic Kingdom parks, but the second and third gates must be used to differentiate the resorts. I'd love to have a second gate in Hong Kong based on Marvel. A more grown up and "real world" second park would suit the weird mixture of cultures in Hong Kong. The other thought I had would be an EPCOT/WestCOT style park, which could easily take advantage of the multicultural nature of Hong Kong. It would be important though to have plenty of E-Tickets in any additional park. Hong Kong is a very different market to all of the other Disney Resorts, and this would need to be taken into account. The other card that Disney might play, is let one of their opponents take the adjacent land, and hope that this competition brings foot traffic towards Honk Kong Disneyland.

Shanghai Disney Resort

I have been told by people within Disney that Shanghai is going to be a game changer. I hope it will be! I want a park in China which will blow the Chinese public away. If nothing else Disney need to make a decent profit on this park, if nothing else so it won't be a burden to the other parks in the first 5 years of operation. The rumour mill suggests the largest Magic Kingdom park yet, with a huge central castle. Can we please have a castle themed to a different Disney princess this time? It's not like you don't have a franchise full. Other than that, I've heard good things about cherry-picking the best new attractions from all the Magic Kingdoms for opening day. I also head there will be large open public spaces, which could be a great asset to the park. 
The good news with Shanghai is that the space available should have space for a second gate. The resort space is roughly three times what is currently in use at Hong Kong. If the return on investment is large enough in Shanghai, the second park may be the next Disney park to break ground. What should this park be? It would have to be big and different! It can't be DisneySea, but I think it will have to be along those lines. In my view they should go to town on a new concept of park. I'm just going to throw this out there as an idea, DisneySky. Realistically what do I think will be built? Probably an Animal Kingdom style park. I wouldn’t mind that though. Whatever the second gate is, it needs to set Shanghai apart from Tokyo and Hong Kong. It will give a greater reason for Japanese, Chinese and Korean nationals to visit each of the resorts. As with all of these resorts it is important that it be localised, but ultimately focus on fostering the love for the Disney brand. When Chinese children grow with the brand as they have in Japan, it has the potential to top Walt Disney World in terms of popularity.

New Resorts

I agree that Shanghai was a smart move for Disney. However, if I was looking for the next locations to build a resort I would be starting to look Eastern Asia. With 3 resorts so close to each other, another resort in Korea or Singapore would devalue the brand in my view. The same is true in North America. Building in the U.S. (except maybe in the North-East) would be a total waste. I can identify to clear target regions for Disney in the next 20 years. They are South America and the West Asia/Eastern Europe/Middle East Region. These are problematic regions though. Disney has tended to target Alpha+ World Cities with their international expansion. Dubai seems an obvious choice, but many people view this region as already over capitalized. India is a great choice for its population alone, but it is such an internally focused country that it is difficult to understand how it could work. Central Europe is coming out of a major overhaul politically and socially, but is it stable enough to support a Disney resort? Would Disney even be popular enough to support Dubai/Zurich/New Delhi Disney? It is very hard to see.

For me, South America is where I would target next. It is much more stable, and much easier to predict. I would expect that Brazil would be the candidate country, with Rio de Janeiro and São Paulo. I think São Paulo is the most qualified city, but doesn't the Rio Disney Resort sound good? Brazilians already frequent WDW in droves. You would have to suspect that given the right location to build, South America would be shooting fish in a barrel for Disney. It is true that theme parks have never been big business in South America but the same could have been said for Asia 40 years ago. If I were Tom Staggs, I would take a holiday to Brazil in the next 12 months, and be thinking very hard about the West Asia/Eastern Europe/Middle East Region. I'm sure people will be surprised that I haven't added Australia to the list for a Disney theme park and resort. While I hope we will get a park here eventually, I can't see Australia having the population to support a Disney scale park within the next 50 years. It would be amazing for our tourism, but it could only happen with serious funding from the Australian government. Come back in 30 years Tom! I do hope that Disney is looking outside of East Asia for their next park. That is certainly what I would do.

Summary

If I were Tom Staggs, I'd be a very busy boy! I would standardize the names of the parks and resorts. I would change the way that the Disney name is used in branding. I'd rebrand Disney California Adventure and Disney's Hollywood Studios to Pixar and the Muppets respectively.  I'd be planning extra gates for Tokyo Disney and Walt Disney World. I'd be thinking about how to expand Disneyland and Hong Kong, but not yet acting upon it. I would ramp up maintenance on the Magic Kingdom style parks, but largely not meddle with them too much. I wouldn't touch Tokyo DisneySea either. I would add several nations to EPCOT's World Showcase, and reduce obvious attraction sponsorship. I would scrap Avatarland, and build Medieval Europe and Australia in the Animal Kingdom. I wouldn't overinvest in Disneyland Paris until guest numbers improved. I would make sure that Mystic Point and Grizzly Gulch were beautifully detailed in Hong Kong Disneyland. And Finally, I would take a holiday to Brazil and consider my options in terms of southern expansion.

I know that is a long list of things that I would do differently. Please don't see this as criticism. I do think that Disney Theme Parks and Resorts is the most amazing company of its kind in the world. Disney has won the love and respect of generations of guests from all over the world. For me it is all about sustaining and increasing that fan base. Not by building the latest fad, but by doing what Disney does best creating unique, rich, immersive and timeless experiences. This is how I would attempt to do that. I'm sure you will have your own ideas as well, so now I'll open it up to you. What would you do if you were Tom Staggs?

2 comments:

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    1. Thanks for your comment! There is room for all types of travel experience out there!

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