2013 Free Dining and MyMagic+: Inferences from Disney’s Q1 2013 Earnings Call



By Dave Shute

MYMAGIC+ AND FREE DINING IN 2013 AT WALT DISNEY WORLD

On Tuesday, Disney released its Q1 (October-December 2012) earnings and discussed them with analysts on its earnings call.

There wasn’t anything momentous in the earnings or the discussion, but a few tidbits, when combined with some recent Disney behaviors and my experiences at Disney World last week, lead me to two inferences (“inferences” being  a two dollar word for “guesses”):

  • We won’t see a lot of free dining at Disney World in 2013
  • MyMagic+ as a way to pre-reserve attraction times and manage your day at Walt Disney World is a ways off. Update 4/3: For more on MyMagic+, see this.

FREE DINING IN 2013 AT WALT DISNEY WORLD

Free Dining at Disney World in 2013Disney World now has deals out covering well into June 2013, and–so far–none of them includes free dining.

This is in sharp contrast to the past few years, when free dining deals during the non-holiday weeks of this period were pretty constant.

But it is consistent with Disney’s years-ago announced strategy of cutting back on discounts as the economy slowly recovers, a strategy made even more possible by New Fantasyland.

New Fantasyland, as senior execs made clear on yesterday’s call, increases Disney’s “pricing leverage”–that is, its ability to raise profits by increasing prices.  A reduction in discounts, of course, is the same as a price increase.

Free dining is a particularly good target for Disney to cut back on, as it’s an expensive discount–compared to say 20% off Pop Century room rates–and complicated for Disney to account for and administer.

I’m surprised, frankly, that free dining’s been so common for so long, and would not at all be surprised if we see hardly any free dining offered in the rest of 2013.  The “traditional” free dining period of late August and September may still be on offer–but even that is of course at Disney’s discretion.

Now some–noting that Disney Tuesday said that Disney World attendance was “up just a hair in the quarter” may respond that Disney needs to discount more to build more volume.

But this would be an error of both fact and interpretation.

The factual point is that the combination of variation in Christmas break dates and in Disney’s own fiscal quarter dates means that it had more high volume dates in the equivalent FY 2012 quarter than in FY 2013.

  • The first quarter in fiscal 2012 ran from October 1 through December 31, 2011 and included all the New Year’s week high crowd dates but two–January 1 and 2 2012. The Christmas crowds in 2011 began December 17.
  • In fiscal 2013, the quarter ran from September 29 through December 29, and, given the patterning of Christmas breaks in 2012/2013, missed seven high crowd dates–December 30 through January 5. The Christmas crowds in 2012 began December 22–5 days later than 2011.

So the fiscal 13 quarter had 7 fewer high crowd dates (5 before the 22nd, and 2 after the 29th) than the comparable quarter in fiscal 12.  My back of the envelope math suggests this could easily have led to a 5-8% difference in attendance over the quarter.

(Note that these “missing” high crowd dates will show up in in Q2 FY13, as also will a week of Easter that in 2012 was in Q3, so FY 13 Q2 should show a significant volume growth compared to the same quarter in FY12, just on changed holiday and break patterns.)

On the interpretive side, the point is that (while the devil is in the details) for equal amounts of revenue, in general Disney is better off with higher prices and slightly lower crowds than it is with lower prices and higher crowds.

In the first instance it both makes more money and has higher guest satisfaction. In the second, because variable costs go up with higher crowds and, in general, guest satisfaction goes down with higher crowds, it may both perform less well economically and see lower satisfaction.

MYMAGIC+ IN 2013: NOT ANYTIME SOON?

In Tuesday’s call, CEO Bob Iger was careful to note that he wouldn’t be announcing a date for the MyMagic+ program–the new approach which (among other things) allows guests to reserve some attraction times from home months before they visit.

Speculation has been that MyMagic+ would go into limited launch this quarter.

After my experiences at Disney World last week, I’m not so sure…

I ran into rampant systems issues–from the new Disney website being down, to online check-in being down for days, to my resort’s front desk system being down for a day, to a change in my room assignment breaking the system, with it insisting that I had already been issued a MyMagic+ wrist band–which aren’t even available yet!

The only tech I could really count on during this visit was towel animals!

Now new systems always come with glitches, but this is a pretty worrisome level of operational instability.

Frankly, it’s hard to imagine that Disney will go live with new tools before it can make current operations stable and reliable…and at least based on last week, there’s a long way to go!

So I’d be surprised to see much more in the way of MyMagic+ capabilities rolled out soon…

Update 4/3: For more on MyMagic+, see this.

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46 comments

1 Scott { 02.07.13 at 7:21 pm }

We are hoping to get free dining for a stay in later October, which does not sound too promising. Oh well, hopefully a decent discount on the room and tickets will happen.

2 Dave { 02.08.13 at 7:05 am }

Fingers crossed, Scott! There have been lotsa room deals so far in 2013–just no free dining…

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3 Tom { 02.08.13 at 7:13 am }

so no free dining plans in the near future, and perhaps not any more? Well, this is actually my very first trip without a dining plan considered, previous ones it was for free, and it’s kinda weird to pay for food at Disney’s, especially a banana for $1.50!
Well, just in case, I used the promotion wisely while it lasted

Oh, by the way, I also ran into difficulties with this new RFID thing they are trying to implement. For instance, my daughter’s ticket was never validated at the “turnstiles” (between ” because they have this totem instead) yesterday and we found out while trying to get a fastpass at Big thunder mtn. That implied going back to the main entrance to have her ticket scanned and hearing her complaints for more than ten minutes… Sigh…

4 Dave { 02.08.13 at 7:28 am }

Hey Tom, what a pain! Still lovin’ AofA? What’s your take on the food court?

5 Joanne { 02.08.13 at 1:59 pm }

Hi Dave,
I feel so bad for not giving a review of our September FIRST WDW trip! It was incredible – beyond my imagination, but my real reason for writing is in respond to your question for Tom. Our group really did not care for the AoA Landscapes of Flavor. The food was okay but it was so loud (MUSIC + people + huge cavernous room with little sound dampening materials), so crowded and it took so much time to get food, check out and then negotiate the space it used up too much valuable park time. On our first park day we didn’t bother going in to get coffee and just took off for AK. We weren’t up and around as early as we would have liked (to see ‘rope drop’) so we planned to get food at park. Went to Pizzafari at around 10 am and had the place to ourselves (at first we thought it wasn’t open) and we took less than a 1/2 hour to order and sit and eat. That was something I wished we had done the rest of the week at the other parks but who wants to pay for coffee when it is ‘free’ with your DDP mug? Not to mention being a newbie in the parks we weren’t sure how easy it would be to get to a food location or how busy it would be first thing in the am. It seemed that there are too many AoA guests using the LoF at peak times, especially mornings, and the amount of order/checkout areas are too few for the demand. We were a large group of 7 so that certainly slows things down. For one person or maybe a couple you may be able to get in and out quickly but add kids to the mix (and I would think that is the majority of the guests at this particular resort) and it seemed to take over an hour to do breakfast. Being our first trip I had nothing to compare this experience to but it really was one of the two disappointments of our trip. Hopefully this tip can help others avoid the same disappointment.

6 Tom { 02.09.13 at 12:38 am }

Dave,

I still love it! It is so similar to Pop that previous visitors would find everything in the same place. ie: food court, restrooms, atm, etc etc.
I guess they copied plans and made a clean up and update to the XXI century.
The food court looks better organized, more seat available, and you find more dishes apart from the typical cheeseburger and pizza. i like the customize your pasta option and the Mongolian food alternative.
What I liked the most were the pools, Nemo’s is so nice and the lobby has an awesome color palette. All the hotel is eyecandy, much more than Pop
Now, I dont like rooms being painted blue since it makes them look darker. Ariel’s shower courtain is pretty but the bathroom being painted dark blue with violet tiles in the shower and a dim light makes it a little dark for my taste, but thats being a nitpicker.
Overall, a great hotel with a price-quality relationship more than reasonable

7 Dave { 02.09.13 at 1:56 pm }

Hi Joanne–what you describe is typical for all the Disney World hotel food courts…none are big enough for the meal time crowds…especially breakfast

8 Dave { 02.09.13 at 2:13 pm }

Thanks, Tom!

9 lee { 02.10.13 at 3:44 pm }

since there is no free dining offers being offered …..we looked into the different dining plans and don’t know that it would be worth it. our kids are 11 and 10 and good healthy eaters…but not big eaters. I cant seem to justify 54 something a day for them to eat. since they are older we are not really looking to do the character meals. we would like to try the new restaurant in fantasyland to see the snow falling! …what do you think would be our best value

10 Tom { 02.10.13 at 10:25 pm }

Lee, the “specialist” here is Dave, but let me give you a piece, if you allow me. That restaurant you were mentioning at Fantasyland, had people standing in line at 10.05 last Friday for lunch. And it was a loooong line by then… I decided not to wait

11 Dave { 02.11.13 at 7:50 am }

Lee–just to clarify…it’s just a forecast, and we won’t know for sure until Free Dining does or doesn’t happen!

The dining plan used to save a lot of money, with the possible exception of for 10-12 year olds with skimpy appetites. But Disney has raised prices so much over the past coupla years that it’s now more of a budgeting convenience than a savings, and for you might well cost more than it’s worth!

The new Be Our Guest restaurant is very cool. You can only reserve it for dinner, and it’s booking up still within a week of when reservations are released–6 months ahead. See this: http://yourfirstvisit.net/planning-your-first-family-trip/when-your-plans-need-to-be-firm/

You can have lunch without a reservation–but doing so may take up to an hour of standing in line…

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12 Tom { 02.11.13 at 8:35 am }

Dave, just to add to your last sentence. The line for lunch ended at the entrance of the new Little Mermaid attraction the other day. I guess people want to dine there no matter what

13 Scott { 02.12.13 at 6:43 pm }

We were fortunate to eat lunch twice at Be Our Guest and once for dinner during our stay in December. I believe the longest we waited for lunch was 45 minutes, although I do not believe it was that long. The lunch and dinner were both excellent. We had the dining plan and felt both were a good use of the dining credit.

14 Dave { 02.13.13 at 6:42 am }

Scott, thanks for the update! And so cool that you got to both meals. What did your kids think of the food options?

15 Scott { 02.13.13 at 4:49 pm }

We opted to order from the adult menu for the quick serve for our seven year old. The options on the kids menu did not appeal to him. The first day he had the turkey sandwich and the second day he had the steak sandwich. He liked the steak sandwich much better. I cannot recall what he had for dinner. The only thing I know for sure is it was from the kids menu since the table service credits requires kids to order from the kids menu.

16 Dave { 02.14.13 at 4:03 pm }

Thanks, Scott!

17 Ginger { 02.14.13 at 10:55 pm }

I’ve been fortunate to get free dining plans for this and our previous trip. This one was a pin-based offer that I received after I booked our rooms. For those guests with young kids or who love character meetings, the character meals are worth every penny. With a free dining plan, I try to book as many character meals as possible. It makes the park visits more enjoyable since we don’t need to wait to see characters. However, it would be great to see a Toy Story meal! Also, Disney ought to add a meal tracking feature to the My Disney Experience app. I had to ask the cashiers for a printout of our remaining balance because I always lose track of snack and quick service meals.

18 Dave { 02.15.13 at 6:59 am }

Thanks, Ginger!

19 retta { 02.27.13 at 1:05 pm }

I want to know if purchasing the quick service plan will really save us money. 3 adults, (but really one 10 yr old,who barely eats) Staying 4 nights. Will it save us money or not to purchase a plan like this. I also do not want to be tied down to running across DW to a set reservation. I would rather just eat when and where we feel like it.

20 Dave { 02.27.13 at 3:15 pm }

Hi Retta!

First, with the quick service plan you don’t have to worry about running to set reservations, as there are no quick-service reservations–you can only reserve table service.

Second, I can’t tell you if you’d save money or not–but with a barely-eating ten year old, probably not. To tell, you’d have to compare what you’d spend with the plan to what you’d spend without it. There’s no way for me to guess at that!

To do this, choose some target quick service venues, look at their menus (you can find suggested venues in my itineraries, and menus for them on the web), figure out what you’d likely eat, and price it out. Then compare to the dining plan cost.

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21 Kim { 03.12.13 at 5:13 pm }

Hi! We are booking our first trip to Disney for the last week in August. If I book now & free dining is offered later, does Disney tend to adjust the rate? We are a family of six & free dining would make a huge difference. Should I wait awhile? When do they tend to announce the promotion for that time of year? Sorry for so many questions – I really appreciate the help!

22 Dave { 03.12.13 at 5:45 pm }

Kim, Disney will not adjust anything–you have to call them and get them to re-book you into the new deal. The deal, if it happens, could come out anytime between today in mid May…

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23 Dan { 03.15.13 at 12:22 am }

I was hoping for free dinning this year it would have been my first time visiting Disney.Dont know if I can afford it now. :( I hope it changes.

24 Dave { 03.15.13 at 9:45 am }

I understand, Dan…and I hope for all our sakes that I’m wrong!

25 Tony { 03.19.13 at 6:03 am }

Hi Dave..Actually to correct you..if I may be so bold…when we were just there in Feb. Be Our Guest was a quick service meal credit. That was surprising to us as it was just as nice as most any other sit down meals. The restaurant was beautiful..the food was great..especially the desserts..but..I suppose my only complaint would be how dark it was inside. Yes it added to the atmosphere and the kids loved it..guess for my old eyes it was just a bit much.
On a side note..we spent 8 nights in a Lion King suite. We loved the AofA resort but in all honesty what’s not to love about a brand new resort….so clean…so new. As for the food court..that alone will be why we will not stay at AofA again. First off..the idea of everything being on an actual dish and using actual silverware is nice in theory..but many many times we noticed that we received a dish or fork/spoon that hadnt been washed properly…gross! Also..newer things like the create your cheeseburger or pasta sounded like a great idea to us until we waited a good 5-10 min for the food item to be cooked. Finally..we also found the “unique” food selection not very appealing to our teenage children. They usually eat anything and are always willing to try new things but they had a difficult time finding something they enjoyed at AofA food court. In fact more than once they walked over to Pop’s food court to grab a snack or meal.

26 Dave { 03.19.13 at 4:54 pm }

Hi Tony, yup, Be Our Guest has always done quick service for lunch…and I get you on the AofA food court…maybe I’ve eaten the same stuff in so many food courts (I’ve stayed in every single WDW hotel) that I’m over-rating something different…

27 Rebecca { 03.21.13 at 11:39 pm }

Hey Dave, My family and I are staying at the AOA at the end of Oct, and we plan on doing a few quick breakfasts in our room, cereal, fruit bars….ect, altho I would like to have breakfast in the food court and probably lunch more often than not, as we will come back for an afternoon break, so my question is, what times in the morning, and afternoon are the best times to eat, to avoid huge crowds? Also since you have stayed there before, could you tell me how long it takes to get from AoA to each park?
thanx so much! :)

28 Dave { 03.22.13 at 1:14 pm }

Hi Rebecca! The rolling time to MK and AK is a little more than 15 minutes, and to AK and HS a little less than that…

Crowds are heavy in the food court between about 9a and 2p, so you’d want to eat befroe or after then, if you can…

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29 Jason { 03.23.13 at 12:42 pm }

Hey Dave me and my wife want to go to AofA in sept but it cost me alot bc i have 3 kids lol anyway we r gonna stay at all star sport bc my son want to go there again and my question to ask u have u been to not so scary halloween party at magic kingdom? if u did how is it and is it worth taking my kids there?

30 Jason { 03.23.13 at 12:43 pm }

Im gonna be praying for Free Dining Plan when we go at the end of sept the lord might help us just one last free dining plan

31 Dave { 03.23.13 at 2:36 pm }

Jason, I have, and if you are on a tight budget I’d say skip it. For more, see this: http://yourfirstvisit.net/2013/02/21/halloween-2013-at-walt-disney-world/

You do know that you can only reserve 4 into Sports–a 5th who is under 3 at the time of check in can also be reserved…

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32 Dave { 03.23.13 at 2:36 pm }

Fingers crossed, Jason!

33 Patrick { 04.05.13 at 9:12 am }

We received the free dining offer in the mail with a pin code after we made reservations as well. We made our reservations in late July for January 2013 at full rack rates. Disney later offered up to $600 off to the general public. A couple of months later we received the pin offer. I was able to book that deal for all three families in our party since I made the initial reservations for everyone. We stayed at Pop and I booked the reservation in hopes of getting free dining. We booked the regular dining plan so that if try offered free dining we could just pay the difference to upgrade from the quick service plan. The free dining plan is our ticket to a yearly trip to WDW. We are big eaters and a big part of our trips are the meals. Hoping for free dining for another trip in November, otherwise Disney may have to wait another year.

34 Dave { 04.05.13 at 10:06 am }

Thanks Patrick…it really is a great deal…which is why we’ve seen none of it so far this year…

35 lisa { 04.13.13 at 5:20 am }

I was hoping to get a free dining in late august. The only good deal I got so far was from travelagloo.com, they offered us gift card. They told me its not likely as well that Disney will offer this in 2013

36 Dave { 04.13.13 at 7:13 am }

Lisa, nobody knows anything yet, including me!

But my strong belief is still that we’ll see free dining for late August to sometime in September, and that your dates will be eligible. See this for why: http://yourfirstvisit.net/2012/09/02/bounce-back-offer-hints-2013-free-dining-dates/

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37 Madeline { 04.13.13 at 5:33 pm }

We will be going this year December 2-10 2013 staying at Pop Century. Stayed at Art o Animation same dates last year. There was the free dining plan at this time but not at AOA. Do you think there will be free dining in December? Thank you.

38 Dave { 04.14.13 at 9:37 am }

Hi Madeline, no I don’t! Everyone–including me!–hopes I’m wrong, but that’s my forecast…

39 Lacee { 04.30.13 at 10:37 pm }

Madeline, we had free dining at AoA last December but we stayed in a suite. If you did not have it you must have stayed in a Little Mermaid room. Those have been so popular many of the deals have not been offered there if you stay in a LM room. Just to clarify for people who may be wondering, free food WAS available at AoA IF you booked a family suite. I hope it come back too by the way!

40 Scott { 05.01.13 at 6:42 am }

I concur with what Lacee states above. We stated in a suite at Art of Animation from December 8 – December 17 and had the free dining starting December 10. We checked in on December 8 and spent two nights in a Lion King suite and checked out and back in on December 10 and went to a Cars suite. It was necessary to do this because free dining did not start until December 10.

41 Liz { 05.06.13 at 10:31 am }

Hi Dave,

I know September free dining dates were released today for cardholders. However, I was wondering if you think they may still release October free dining dates? Thanks…

42 Dave { 05.06.13 at 12:54 pm }
43 Liza { 07.02.13 at 4:33 pm }

Hi Dave,
I am going to WDW December 2-9 2013 and I have several family members that have received emails from Disney with pin codes for free dining at the time we are going. Unfourtanitaly they cannot travel with us and we cannot use the codes because we are not in the computer under their names. I’ve called Disney and there aren’t any codes attached to our names. I was wondering if you think that will eventually offer this to everyone or just the lucky few who get the email. If not do you think that they will offer any room discounts or discounts for Disney visa holders. Any information is helpful! Thanks!

44 Dave { 07.03.13 at 7:53 am }

Hi Liza, I do expect to see a room rate deal for your arrival date, announced as soon as early August, but not general public free dining.

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45 DM { 09.17.13 at 3:54 pm }

looking for a pin code for free dining for end of Sept to Oct. 5, 2013 or just a free dining add on. I have room booked a Port Orleans, FQ already.

46 Dave { 09.17.13 at 5:47 pm }

All gone long ago, I’m sorry to say…

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