by Ray Keating
August 20, 2020
How do you get people to come to your theme parks during a pandemic?
That’s obviously a difficult question that companies like Disney and Comcast (owner of the Universal parks) wrestle with on a daily basis.
Before the pandemic, theme park pricing actually was focused on “date-based tickets.” We economists call this peak-load pricing or congestion pricing. That is, adjust pricing according to dates and times of the day in order to control crowds, enhance the guest experience, and maximize profits. This pricing model is used by hotels, movie theaters, utility companies, toll roads, and so on. It’s straightforward economics in that consumers react to price changes, so businesses can better manage resources by adjusting prices to reallocate consumption from periods of high demand to times of low demand.
In fact, even in the current period of COVID-19 and a brutal economy, date-based pricing made an appearance in the news in recent days with Universal Orlando announcing that it was following Disney’s lead in implementing this model. Disney went in on date-based pricing starting in 2018. Universal now will vary ticket prices based on when people visit their parks.
Fair enough. Makes sense.
But far more interesting was a pricing option Universal Orlando served up to Florida residents earlier this month. Actually, I’m not sure if you can really call this a pricing option; it’s more like a giveaway.
What’s the deal? Florida residents can purchase a 2-Park, 1-Day Park-to-Park Ticket, and come back every day through December 24 with no blockout dates. That’s right, for $164, a Universal guest gets to visit both parks – Universal Studios Florida and Universal’s Islands of Adventure – each and every day, if they choose to do so, through Christmas Eve. That one-time, $164 payment covers it all. And you can toss in Volcano Bay for another $29. Florida residents have this option through September 30. If you love Universal, this is an awesome deal. Heck, if you just like Universal, it’s a great deal.
The question in coming days and weeks is: Will this incredible offer for Florida residents by Universal affect Disney’s pricing decisions? Well, don’t be surprised if Disney follows suit in some way. But in the end that will depend, of course, on multiple factors, especially the direction of the pandemic, the economy, and therefore, park attendance.
Ray Keating is the editor, publisher and economist for DisneyBizJournal.com, and author of the Pastor Stephen Grant novels. He can be contacted at email@example.com.
Also, get the paperback or Kindle edition of Ray Keating’s new book Behind Enemy Lines: Conservative Communiques from Left-Wing New York.