Disney’s theme parks have become too expensive and crowded, CEO Bob Iger says, and he wants to fix that.
Speaking at the Morgan Stanley Technology, Media and Telecom Conference earlier this week, Iger said Disney’s theme park pricing has alienated guests in recent years as the cost of admission, hotels, food and other trip features have markedly increased. He made similar remarks during Disney’s first-quarter earnings call last month.
“I’ve always believed that Disney was a brand that needed to be accessible, and I think that in our zeal to grow profits, we may have been a little bit too aggressive about some of our pricing,” he said Tuesday. “And I think there’s a way to continue to grow that business but be smarter about how we price.”
Iger mentioned Disney’s recent steps to reduce pricing, such as its decision in January to rescind the parking fee for guests at Walt Disney World hotels. He said the company will continue to adjust pricing based on visitor feedback but did not give specific examples.
Disney fans often blamed former CEO Bob Chapek, Iger’s predecessor who was ousted from the company in November, for price hikes in recent years as the company weathered the COVID-19 pandemic. In response to previous complaints from guests, Disney has said it offers budget-friendly options and is investing in attractions and services.
Disney has had to balance the cost complaints with simultaneous ones about theme park crowds.
Iger referred to Disney’s park reservation system as a way to keep crowds down while still profiting from admission. Increasing ticket prices would help manage capacity, but Disney is “being careful about” that because of the pricing feedback, he said.
Building new attractions is another way to manage crowds, Iger said, adding that Disney has opportunities for expansion at Walt Disney World and its other theme parks.
Iger said he is confident Disney’s theme parks will be able to weather a recession because of their success in recovering from the pandemic and enduring appeal. The division that includes theme parks set a record fiscal year revenue of $28.7 billion last year.
“The ability for a family to experience one of our parks is something they don’t give up right away,” Iger said. “I remember someone telling me once, ‘They’ll hold onto their car longer, or their refrigerator, so they can take their kids to one of our parks.’”
Iger plans on leaving the company within two years. Federal filings show his contract with Disney ends Dec. 31, 2024.
Asked about the remaining plans for his tenure, Iger said “succession is pretty much at the top of the list” between him and Disney’s board of directors. He met with the board this week to discuss the company’s next CEO.
“The conversations have been great, and I’m confident that we’ll identify the right successor at the right time,” he said.
He has been focused on stabilizing and reorganizing the company and cutting costs in the meantime. A recent restructuring involved 7,000 layoffs company-wide as Disney looked to cut $5.5 billion in costs and reorganize into three core segments.
Iger said he has seen success in his efforts so far and is now focused on “getting our content pipeline right” and making the right decisions to set the company’s course.
“My goal is essentially to leave here in two years, with a trajectory … that is very optimistic and positive,” he said.
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