Why Disney World Deals Are So Hard to Find
By Dave Shute
In recent years, Disney World has offered deals most parts of the year.
The most common deal is discounts on its hotel rooms, but now and then it also offers package deals, such as the dining plan for free to those who book a hotel room and tickets at full price.
In 2015, however, several major deals in a row have been hard to book, especially for the least expensive “standard” rooms: the fall free dining deal (now closed), and room rate deals for early and later fall (both still open).
Why are these deals hard to book? Because Disney is making many fewer rooms out of its inventory available for the deals. And why is it doing that?
Because it can get really good occupancy and rates even without the deals.
A week and a half ago Disney reported its Q3 earnings and (in its earnings call) hotel trends for the current quarter. In its 10Qs it also includes available room nights, occupancy, and per-room guest spending.
For Q3 2015 (basically April to June) it reported 2.6 million available room nights at 87% occupancy with an average spend of $310 per night.
Multiply them together, and that’s more than $700 million in domestic hotel revenue, Disney’s highest results ever, and nearing twice the worst quarter of the recession, Q2 2009 when hotel revenue was just a bit over $400 million.
Seasonality can muddle Disney’s trends, but using a four quarter moving average clears out seasonality.
The chart above shows the results of this analysis.
It combines the effects of available rooms, which vary from both new construction and rooms taken out of inventory for refurb…
…occupancy…
…which then results in booked rooms (multiplying available rooms by occupancy)…
…and is multiplied by guest spend per room to yield actual room revenues per quarter.
Disney is a public company–which means it has the job of increasing earnings. How do you increase earnings when your hotels are booked almost to capacity?
Well, one way to increase earnings when you don’t have a whole lot more rooms to sell is to cut back on the number of discounted rooms you offer…
Follow yourfirstvisit.net on Facebook or Google+ or Twitter or Pinterest!!
0 comments
Comment by typing in the form below.
Leave a Comment | Ask a Question | Note a Problem