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Monday, February 28, 2022

Struggling with the Business Side of Disney’s Star Wars Immersive Hotel

 by Ray Keating



February 28, 2022


Okay, I’m struggling with the Halcyon, particularly from a business perspective.


It’s been nearly ten years since Disney paid $4 billion to acquire LucasFilm and Star Wars. And to be honest, Disney’s track record with the legendary Star Wars franchise has been uneven. And now there’s the addition of the Star Wars Galactic Starcruiser hotel, or the Halcyon, at Walt Disney World, which has been greeted with mixed reviews from media and bloggers who were given an early look at the completely immersive experience.


As for Disney’s spotty track record, consider that on the film front, Episode VII – The Force Awakens (2015), Rogue One (2016) and Solo (2018) were generally solid vehicles, though far from spectacular and each had issues. Meanwhile, Episode VIII – The Last Jedi was a hot mess directed by Rian Johnson, followed by Episode IX – The Rise of Skywalker trying to repair the damage done by Johnson but ultimately failing to do so.


It took Jon Favreau, along with Dave Filoni, creating The Mandalorian (Season 1 in 2019 and Season 2 in 2020, with a third coming) on Disney+ for Disney to have its first major success with Star Wars. And while The Book of Boba Fett (debuted at the end of 2021 on Disney+), also created by Favreau, wasn’t at the level of The Mandalorian, it was solid, especially when the show featured the main characters from The Mandalorian. And more Disney+ series are on the way, with justified anticipation.


As for the parks, Star Wars: Galaxy’s Edge, which opened in 2019 at both Walt Disney World’s Hollywood Studios and Disneyland, faced a bit of grumbling due to the company initially over-promising on the overall experience, but these have settled in nicely as must-see parts of the parks – for all Star Wars fans, no matter how deep that fandom runs.


That brings us to the Starcruiser hotel, which opens for two-night stays for guests starting on March 1.

Now, I was not part of the media who got a sneak peek, nor will I be staying at this hotel. But there is enough information around at this point for me to highlight questions I have been pondering for some time now about this from a business perspective.


First, consider that the Starcruiser hotel has 100 rooms or suites. Compare that to approximately 36,000 hotel rooms on the Walt Disney World property, and the Halcyon barely registers. But then there is the price tag for a two-night stay, roughly coming in at a whopping $1,200 per person per day. So, the required two-day stay will hit a couple up for about $4,800. That price includes the hotel room, food and drink excluding alcoholic and specialty beverages, a day trip to the Hollywood Studios park, and a Magic Band.


Second, the key selling point for this two-day experience is its immersion. That is, for 48 hours you’re effectively LARPing. Some might ask: LARP? Live Action Role Playing. Now, as long as I’ve been around nerd stuff, from comic books to Star Trek to Star Wars, LARPing even at sci-fi/comics conventions was a pretty limited activity. But the videos from the Halcyon, in fact, point to an intensive, ongoing role playing experience. I’m far from an introvert (my family notes that I seemingly will talk to anyone), but this didn’t look like an enjoyable experience to me (perhaps I’m just getting old). I can’t imagine introverts – of which there are more than a few among intense sci-fi fans – would fork over substantial funds for this kind of experience.


Third, the reviews have been all over the place on the experience and hotel itself, with assessments of the rooms ranging from “spacious” to “small and cramped,” and one noteworthy reviewer (the Disney Food Blog) saying that the hotel put “the wealthiest guests inside a windowless bunker for two full days.” Yikes. However, guests spend little time in their rooms anyway, as they reportedly are off on an assortment of adventures that all somehow tie together in the end.


CNBC’s reviewer wrote:


     From the moment passengers board the shuttles to the Chandrila Star Lines’ starcruiser known as the Halcyon, the adventure begins. And it doesn’t slow its pace until they disembark after the “voyage” two days later…

     So, let’s address the bantha in the room right away: Is Star Wars: Galactic Starcruiser worth the price of admission? 

     Yes, but with one condition — you have to be willing to play.

     Passengers get back what they put into their time aboard the Halcyon. If you suspend your disbelief, embrace the story and participate without self-consciousness, this will be a trip you and your family will never forget.


Meanwhile, a reporter from TheVerge.com wrote:


     The Halcyon is also smaller than you might expect. The main dining cabin is about the size of a medium-sized restaurant, while the atrium’s neon-soaked bar offers seating for a couple dozen people at most. (And only a single sabacc table!) There are “restricted” spaces that open up for story elements, like the cargo hold, brig, and engineering bay, but there are really only two or three main “public” spaces to spend time in outside of those plot moments…

     Galactic Starcruiser asks a lot of its guests. You’re basically diving into a giant improv exercise with dozens of strangers. And what you’ll get out of the experience is largely what you put in. In my short time there, it was hard to shake the feeling that I was just going through the motions for the particular story track my group was assigned. Maybe the smaller groups, added time, additional context, and more gradual pace of storytelling that the full experience has help make the process feel more organic.


I think you get the point – different takes and different experiences depending on one’s point of view. Some will dive in and adore this, and many – my guess is a lot more than the former group – will never board the Halcyon, and not just because of the price tag, but actually due to the experience, that is, the very selling point of this part hotel, part theme park ride and part LARP.


That leads to my key conundrum with this 48-hour experience from a business investment perspective: Why?


A 100-room hotel perhaps speaks to the limited potential market, and the price tag means that guests have to show a high degree of commitment. But these are only two-day stays, which will require not-insignificant turnover for as long as this hotel stays in operation. Does it really make business sense to create this kind of experience, especially at the cost? And what if it flops, and Disney takes another hit on its Star Wars brand? Well, I guess Favreau and Filoni can come up with another Disney+ series.


But here’s the real kicker. As I have explored assorted Disney World hotels of late, my mind has wandered back to an alternative investment that Disney could have made for a Star Wars hotel. And trust me, this is not some kind of genius moment on my part, but rather, it just seems like common sense. 


Consider that Disney World’s moderate resorts range from 1,000 to 2,400 rooms. Picture the demand for a large, expansive Star Wars resort with 2,400 rooms, with in-depth theming from the rooms to the pools to the restaurants to the grounds and beyond. All kinds of events and activities could allow people to engage to the degree that they truly choose for their own comfort and vacation time. And the rooms could be priced, again, at the moderate level, or even a bit higher. OMG, there would be a long, long line of individuals and families vying to stay at such a resort – and they could just enjoy a Star Wars vacation at Walt Disney World, even if they were introverts or extroverts who wish to have nothing to do with LARPing. Oh yes, and the family members who care little about Star Wars would likely have a great time as well, given that this would be a full resort with all of the amenities that are missing on the Halcyon.


Am I crazy, or does this make a heck of a lot more sense for both fans and shareholders?


Of course, Disney could still make such an investment, and they just might do so, depending on what lessons ultimately are learned from consumers regarding the Halcyon.




Ray Keating is the editor, publisher and economist for DisneyBizJournal.com, and author of the Pastor Stephen Grant novels and assorted nonfiction books. Have Ray Keating speak your group, business, school, church, or organization. Email him at raykeating@keatingreports.com.


The views expressed here are his own – after all, no one else should be held responsible for this stuff, right?


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Keating has three new books out. Vatican Shadows: A Pastor Stephen Grant Novel is the 13th thriller/mystery in the Pastor Stephen Grant series. Get the paperback or Kindle edition at Amazon, or signed books at www.raykeatingonline.comPast Lives: A Pastor Stephen Grant Short Story is the 14th book in the series. Again, get the paperback or Kindle edition at Amazon, or signed book at www.raykeatingonline.com. And order the 15th book in the series What’s Lost? A Pastor Stephen Grant Short Story – grab it at Amazon.com or signed editions at www.raykeatingonline.com


Also, check out Ray’s podcasts – the Daily Dose of DisneyFree Enterprise in Three Minutes, and the PRESS CLUB C Podcast.

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