Classism and park demographics: whither the credit whore?

Thursday, January 19, 2006 9:46 AM
In another thread, Lord Gonchar said:


If you listened to this week's podcast, Jeff touched briefly on "class-ism" - I think it's becoming more and more apparent that this might just be the case. These guys want people in their parks that aren't afraid to drop some cash for a good time. They don't want kids milking the season pass all summer. They don't want enthusiasts who use the pass to stop at a half dozen parks, credit whore and bail.

We've had this discussion before, and it went something like this: Six Flags is giving away the gate. Because discounting begets a "discounted" mentality, parkgoers expect the day to be "cheap". Folks buy a season pass and a season parking pass, and maybe a coke once or twice a season, and go a half dozen or more times. The result? Six Flags is losing money. The CBuzz conventional wisdom: stop giving away the gate, and everything gets better. Attendance might go down, but you lose people who were costing you money, so it doesn't matter.

That sounded pretty rational. And, you could point to many other examples: Disney rarely if ever discounts single-day tickets, and in Florida, their resident passholder prices *start* at about $225, and those come with blockout dates. Anaheim is cheaper at $120 for the cheapest Southern California resident pass, but that won't get you in on any weekend day, on or around any holiday, and during nearly all of the summer---in other words, strictly a clearance sale for the retirees and the homeschool crowd. Even then, a substantial minority of the Disneyphile community has been up in arms about giving away the Disneyland gate, reducing the overall experience.

This year, that conventional wisdom has been turned on its head. Cedar Point surveyed their guests, and found that their guest median income was rising much faster than the median income of their local market. Their conclustion: they were pricing themselves out of their market. The reaction? A gate price decrease for what may be the first time ever, explicitly to give people of more modest means (read: a lower socio-economic class) more of an opportunity to visit the park.

In 2005, multi-day visits at Walt Disney World got SIGNIFICANTLY cheaper. In 2004, a ticket that got you seven days entrance plus four vistits to water parks, disney quest, or pleasure island was about $365. In 2005, that same ticket (with five minor-park vists instead of four) was only $297. In 2006, that ticket (now with *six* minor park visits instead of five) is $313. Granted, these new lower priced tickets expire after 14 days, rather than being good forever, but according to folks that know, less than 15% of unused, leftover days to WDW parks are ever redeemed, so this isn't such a big hardship. The bottom line is that for a family of four visiting the Mouse for a week, tickets are $200 cheaper in 2006 than they were in 2004, *and* offer more in the bargain.

And, as a much bigger question: let's assume that one maximizes profits by cutting out the bottom end of the guest demographic---they represent the smallest marginal value, and not having to serve them reduces costs and/or improves the guest experience for those not yet priced out of the market. The ones who remain tell their (economically similar) friends what a great time they had, encouraging them to go, etc.

On the other hand, one of things I value about most theme parks is that, historically, it didn't much matter how much you had to spend, everyone had roughly the same experience. Now, that's never been strictly true: some people bring picnics in coolers, others eat in-park. And recent developments have made the economic differences between guests even more apparent: perks for guests staying in park-owned (and premium-priced) hotels, QBot and front-of-the-line passes for purchase, VIP seating/food packages for shows and parades, etc.

So, are these parks trying to meet one another in the middle, or have they fundamentally changed the way they do buisiness? Discuss.

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Thursday, January 19, 2006 9:53 AM
I think there was a gradual shift going on to try and lure those guests willing to spend more money in the parks, thus the on-site hotels, Q-bots, the "premium" season passes and the like.

Snyder and Co. have turned away from the theory of "evolution" of the park experience, and ratcheted up the speed that things are changing...it's now a blur! ;)

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Thursday, January 19, 2006 10:34 AM
Great post gator...

I wonder if the CP price drop is anomaly? The Detroit/Ohio industrial market is about the only area of the country that has not experienced economic growth the past few years! They certainly may have priced themselves out of their local market.

Your Disney example is certainly correct...but again a unique product (4 parks) in which they can more than "recoup" the money lost on discounted multi-day tickets! Single day pricing is still through the roof!

All this talk of class-sim (as if you did not know what I would say) seems like an attempt to belittle parks/executives for pricing structure (I apologize if I’m misreading the term)! I do not see increased pricing as a bad thing if the park is able to increase profits. Who can blame a park for setting pricing that gives the most return? That is their job! Amusement parks are not a charitable organization with a social responsibility to assure EVERYBODY can utilize their product. They are a business and should run as such! Their main responsibility…like it or not…is to provide a nice return to the stockholders! Luckily for us enthusiasts…if they do not provide good thrills and excitement…the stocks tend not to go up!

Anyhow...I'm in the camp that believes I would pay a lot more for these parks if they would up the experience...good food/multi-trains/fast loading/decreased crowds/etc! I'm of the belief that most parks are no longer able to handle the people they let through the gate (on many days) and still assure a good perceived value factor for the guest! I still think some sort of tiered pricing structure (way more expensive on weekends/holidays/etc) is the way to go AND I honestly believe it is coming! The recent SFMM $15 parking on weekends and $10 on weekdays is the first attempt I've seen at differentiating pricing based upon demand!

…as for Six Flags…I’m the wrong guy to ask! I wasn’t going at last year’s prices and I’m certainly not going now! Until they up their service quality…count me out! Looking at their stock performance and debt ratios…it would appear there are others like me out there…or at the very least they (Six Flags) have no clue how to effectively run the business!

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Thursday, January 19, 2006 10:38 AM
Kinda like a rocket coaster eh? ;)

Although I can understand the wisdom of not giving away the gate, there's a point where you price regular families out of your park. Well let me qualify that. There's a point where families don't see the value anymore. With high gas prices, high housing costs, and a perceived lack of quality, when this Southern California resident decides to take his family to one of the local parks, he'll be even less likely to drop his cash at say, Magic Mountain's doorsteps.

And didn't someone point out that SFMM is now more expensive than Disneyland? What's THAT all about?

You'd think the local competition would keep prices lower.

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Thursday, January 19, 2006 11:15 AM

Jeffrey R Smith said:
I still think some sort of tiered pricing structure (way more expensive on weekends/holidays/etc) is the way to go AND I honestly believe it is coming!

Ski resorts do it and we never go on weekends. We go on the buy one get one free weekdays! :) Not to say that I am against an idea like that, I think its fine.

A couple items of note to compare/contrast ski resorts to amusement parks.

- Season passes at ski resorts are priced high
- Parking is free
- Beer and food is expensive
- They make money on rentals

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Thursday, January 19, 2006 11:15 AM

All this talk of class-sim (as if you did not know what I would say) seems like an attempt to belittle parks/executives for pricing structure (I apologize if I’m misreading the term)!

You know, I'm really not sure that I've come to a conclusion on this issue. And, if anything, I think I come down on the "pro-classist" side---I'd happily pay a bit more to visit parks as they are now, and if it meant fewer people in the park, that'd be even better. It's also certainly true that these parks are a business, and are duty-bound to maximize their profits; if pricing out the low end of the market does this, then that's what they'll do.

Furthermore, nearly everyone finds it comfortable to be surrounded by people more "like them", where "like them" is defined socio-economically. It's an ugly truth, but it's true nevertheless.

As an example, people almost universally buy a house in the most expensive neighborhood they can afford wihtin some reasonable distance of their jobs. Why? Because, fundamentally, they know that the people around them can afford it too, and those folks are presumed, rightly or wrongly, to make better neighbors than the folks who can't afford it.

As one consequence, the continued ex-urbanization of our country is doing more for economic segregation than Jim Crow laws ever did for racial segregation. I saw some truly frightening numbers on how the demographics of Michigan students have changed in the past 20 years. in 1985, you could at least plausibly argue that Michigan repesented an opportunity for all high school graduates in the state. Today, it would be hard to say that without laughing out loud---if your parents don't live in a posh suburb, you almost certainly are not coming to Michigan unless you are truly exceptional. Period. End of story.

And, personally, I think that's really a shame, because it's anecdotally clear to me that parental income is not necessarily related to raw intellectual talent. It is certainly related to preparation, but not necessarily ability.

Of course, a college education is something very different from a day at an amusement park, and so while I worry about the accessability of the first, the second may not bother me that much. As you say, these parks are not a public good.

*** Edited 1/19/2006 4:17:20 PM UTC by Brian Noble***

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Thursday, January 19, 2006 11:19 AM
Well, if the big parks don't want to tap that money, perhaps Boomers will fill in.
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Thursday, January 19, 2006 1:54 PM

janfrederick said:
Kinda like a rocket coaster eh?

Although I can understand the wisdom of not giving away the gate, there's a point where you price regular families out of your park. Well let me qualify that. There's a point where families don't see the value anymore. With high gas prices, high housing costs, and a perceived lack of quality, when this Southern California resident decides to take his family to one of the local parks, he'll be even less likely to drop his cash at say, Magic Mountain's doorsteps.

And didn't someone point out that SFMM is now more expensive than Disneyland? What's THAT all about?

You'd think the local competition would keep prices lower.


Have to agree. Disney and ski resorts can charge inflated prices because they offer a completely different experience and value for what they charge. How many upper class people actually visit SFEG or SFA? Even if the parks improve over time, they still are amusement parks and nothing more, not something I see the higher class flocking to by the millions. If SF prices themselves away from the average family, they're just shooting themselves in the foot.

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Thursday, January 19, 2006 2:19 PM

jomo said:
If SF prices themselves away from the average family, they're just shooting themselves in the foot.

LOL, I think they're aiming a tad higher... ;)

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Thursday, January 19, 2006 2:44 PM
"Come along, Lovey... We're going coastering with the Rockefellers and Vanderbilts this weekend."

"Alright Thurston, but you know how sick I get on Roller coasters."

"That's alright Lovey, we'll have the butler throw up for you."

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Thursday, January 19, 2006 3:22 PM
To me the funniest part is all the "Well I won't be visiting SF this year" posts in the parking price thread.

That's exactly the point. They don't want you there anymore.

If this sort of concept is what they're aiming for, it's working already. :)

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Thursday, January 19, 2006 3:34 PM
I would love to know how many of those people who say they will not go to a Six Flags park this season for all the reasons of the new policies (even the ones the recinded and the people still said "I am not going because they thought about doing this") actually visit a Six Flags park. I bet they will say I only went because a group of friends asked me to meet them there or I wasn't going to go but I found the time and decided I really wanted to ride _______ (fill in the new coaster).
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Thursday, January 19, 2006 3:36 PM
I'm not entirely convinced that they *want* to out price the "less well off" portions of their guest base. For one because it's a significant portion of their guest base and 10 people making you $1 each is better than 1 person making you $5.

I still don't understand, like Jeff Smith, why parks don't have an official weekend/holiday rate and and official weekday rate without coke cans or coupons.

All this said, Knoebel's and HW both seem to be doing quite well and neither is too expensive in park or admission wise.

Vote with your money and your trip to guest relations. *** Edited 1/19/2006 8:45:24 PM UTC by ApolloAndy***

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Thursday, January 19, 2006 3:55 PM
Thats Fine Gonch, Im more than happy to take the money IM willing to spend elsewhere and probably spend more than I wanted because everything was economically feasable to buy. HW, Kennywood, Knoebels, IB.

I said it before and I'll say it again, Any park that is even remotely close to a SF park is in for a banner year. Clementon, If they play their cars right can come back from the grave. Hershey and Dorney are laughing. HW already thriving on SFKKs lack of service while providing great services themselves may reach the 1 million mark this year.

The Dells, My God, Chicago is 15 million people. SFGAM sees a record gain become record losses in one year.

Chuck, singin a tune called, It's the end of Six Flags as we know it, And I feel fine.

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Thursday, January 19, 2006 4:03 PM
Meh, I'll vote by going to Elysburg and to Santa Claus...

And, as mentioned earlier and in other threads, they may not charge me for parking, and admission is either cheap or even free, but they'll MORE than make up for it in merchandise and souvies (hello, free advertising), and I'm *always* willing to eat good food at reasonable prices (and the crab cakes at KG last year were dee-lish). The word-of-mouth advertising they get from a loudmouth like me, you can't beat that anywhere! ;)

I think SF just jumped the gun on these policies by a year or two...FIRST you have to make people want to be there, THEN you can price out "the undesireables"... ;)

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Thursday, January 19, 2006 4:09 PM
Trust me Gator, HW is not well known in Cincinnati area, However you'd be surprised at the number of people I know that visit there reguarly and even spend mini vacations there.

SF isn't the only chain to hack people off to visiting them again, The other big two, CF and Paramount have done their far share of it but still provide good service in most cases therefore the losses aren't as bad.

Don't believe me? Why are some parks gaining 20+% without a major expansion or addition while others adding 25 million dollar rides can only boast a 3-7% gain only in the debut season of such rides and either maintain or drop attendance afterward.

Chuck

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Thursday, January 19, 2006 4:21 PM

I'm not entirely convinced that they *want* to out price the "less well off" portions of their guest base. For one because it's a significant portion of their guest base and 10 people making you $1 each is better than 1 person making you $5.

That's true if those 10 really make you $1 each. But, if the 10 make you $0.50 each, then you'd rather have the one, because that one has a better time without the other nine and is more likely to return and tell other people to visit. And, if those 10 make you $0.49 cents each, well, then it's pretty clear. Cedar Point's position is that it's worth it to keep the 10, and they dropped prices accordingly. Six Flags' position seems to be that it's not, given the dramatic price increases we are seeing.

The interesting part is that this is nearly a complete 180' turnaround from the two positions in the past!


Im more than happy to take the money IM willing to spend elsewhere and probably spend more than I wanted because everything was economically feasable to buy.

True, you are---as an enthusiast who compares different parks are willing to travel. If it were Six Flags Cincinnatti instead of PKI, the VAST majority of other guests wouldn't. Remember, they probably only go to one park, one time, per year, at the most. It's a day trip, with maybe a single overnight stay, but probably not. Certainly not a two-night trip. So, they'd either continue to go to our hypothetical SFC, or would just not bother and go to the lake or a Reds game instead, because Kennywood is 4+ hours away.


Any park that is even remotely close to a SF park is in for a banner year.

Except that it's not a zero-sum game. If SF follws thorugh with an actual improvement in in-park experience for families, it's likely to increase the total pie for amusement parks. Likewise, if they screw this up, the people they piss off not only won't go back to Six Flags Wherever, but they're not going to any other parks for a while either, because "they're all the same."

This isn't to say that exceptional venues like HW can't attract more "conventional" guests, but it's largely through word of mouth. Joe and Jane Skyline hear that this HW is a great place to visit, and they spend their one visit *there* instead of our hypothetical SFC, but these kinds of changes take years to play out, and won't happen overnight.

So far, this thread is the same as all of the others on the Six Flags topic. Most of us are assuming that "regular people" think about amusement parks the way we do, and it's just not true. A visit to a park is just another "would be nice if we can make it" part of summer, like ballgames and camping.

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Thursday, January 19, 2006 4:30 PM
And like I said before. Word of mouth goes ten times further in convincing someone to visit or not visit than any amount of advertising dollars spent by the chain. Sure the commercial ever five minutes might get said person in the door once. Rip em off and treat em bad and that one visitor tells ten people about how much it sucked.

Treat em right and provide great service and value and a great time and that same person referes people for who knows how long to said park.

Sorry for sounding like the KW, HW, IB spokesman but I wouldn't say it if it weren't true, I also challenge anyone one to try and go to any of these three parks and have a bad time. Unlike some SF parks where you might get a 60% possitive expereience response, I bet these parks are well into the 80-90% range.

Chuck

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Thursday, January 19, 2006 4:45 PM
I think SF is way off the mark in it's pricing structure. Nationally, people have less income now (adjusted for inflation) than they did five years ago. An interesting statistic:

For the second consecutive year, median household income declined: income dropped last year by $93 -- down to $44,389. In real terms, median household income has declined by $1,669 since 2000. [U.S. Census Bureau, 8/30/05; Table A-1]

So, in a country where people have less income and rising energy costs, raising prices may have a very negative effect on attendance. What are you going to do without? Is it food on your table or rollercoasters?

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Thursday, January 19, 2006 4:53 PM
Pete,

Is this a trick question?

:-P

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