I could fill a scroll of “blue sky” ideas for Walt Disney World: an Aladdin attraction that lives up to the incredible film on which it is based, an Up themed (“adventure is out there”) attraction in Adventureland, or a Magic Kingdom nighttime parade to end all nighttime parades. But none of these are as high on my list as the subject of this post – a Moderate Magic Kingdom Resort on the northeast side of Bay Lake.
Upon hearing my singular wish, I can guess that readers fall into one of two camps. Many of you are shouting (or quietly whispering if you are reading this at work) a jolly, “Hear, hear!” However, others are quick to make the business sense argument, “That’s a nice wish, but the Magic Kingdom area is premiere property and will never see less than deluxe.” Those of you who cheer my desire for a moderate, please indulge me – or join with me – as I make my argument for why a more affordable resort on Bay Lake very definitely makes good business sense.
Typical supply and demand economics would tell you that the Magic Kingdom area resorts rightfully charge a premium for their proximity to the most popular theme park in the world. Their location brings along a unique series of perks that serve to drive a high price: Monorail service, nighttime fireworks visibility, and neighboring premiere resorts with luxury restaurants, lounges, shopping, shows and more. So, why from a business standpoint should Disney consider purposefully building a resort where they will charge a price below equilibrium?
Revenue is more than a Room Rate
The revenue derived from a WDW guest does not come exclusively from his or her resort room reservation. Guests purchase park tickets, food, souvenirs, party tickets, recreational activities and so much more. Because of this fact, it stands to reason that more guests staying on property means more money being spent on property. The Magic Kingdom Deluxe and Deluxe Villa Resorts have a weighted average of 645 rooms while the weighted average of rooms at the Moderate Resorts in WDW jumps to 1802. If you assume a new Moderate would be built with a similar capacity and that each room is being filled by just two people, that is a maximum of 3604 guests versus 1290 at a Deluxe or Deluxe Villa Resort. That is 2314 more people eating on property, buying park tickets, purchasing souvenirs and more. These are people who may also see their way to purchasing extra add-ons, attending a party, or making an extra table-service reservation during their vacation because they spent less on their room.
I know what all of the business-minded individuals are thinking: Will the increase in rooms and on-property purchases outweigh the loss of revenue from the decreased room rate? This hinges not on whether the rate is more or less, but the total revenue from the resort. Moderate Resorts charge a weighted average of $230 for a standard view room. Magic Kingdom area Deluxe and Deluxe Villa Resorts command a hefty $456 weighted average for a standard view room. A first glance would say the premium Magic Kingdom Resorts are bringing in much more money, but the number of rooms filled at that rate must be considered. If the average number of rooms were filled to capacity at the average standard rate, here are estimated total revenues for one night in both categories:
As can be seen in the above graphic, if a Moderate Magic Kingdom Resort was built similarly to the others on property, it would easily be able to break even or exceed the room rate revenue of a Deluxe Resort in the same area.
This begs the question, how would Disney continue to charge a higher price at Disney’s Wilderness Lodge if rooms were available at a lower rate in the same area with the same transportation options. Keep in mind that Moderate resorts do not offer the same amenities as their Deluxe counterparts. Deluxe resorts boast larger rooms, bathrooms that are entirely separate from the room, in-room refrigerators/microwaves, room doors in an interior hall instead of exterior entrances, signature dining, and more. Options such as these would still place Disney’s Wilderness Lodge in a higher rate tier.
A Dose of Goodwill
For those who do not know, “goodwill” is a business term. According to Merriam-Webster, it is “the favor or advantage that a business has acquired especially through its brands and good reputation.” In the current world of luxury-extra-pay-this and hard-ticketed-that, the social media driven, wide world of Disney could use a goodwill boost with concern to its middle class customers. It does not take a deep dive into the world of Disney Twitter to see that many fans are disenfranchised with the number of high-expense offerings that have been rolled out at WDW over the last couple of years (look no further than the now-defunct Tomorrowland cabanas).
Now, think back to May of 2010, when Disney unveiled plans for Disney’s Art of Animation Resort. Guests, especially middle-class families, were overjoyed to hear news of another affordable resort. Now imagine the elation of those families if a Moderate Resort was opened in the Magic Kingdom area (with rates on par or even much lower than the Art of Animation family suites). Families with young children, who spend a large portion of their time at WDW‘s original park, would be able to stay within a short distance.
Disney’s bread and butter customer is the All-American family, and as many of those families board the Monorail or cross the Seven Seas Lagoon on the ferry, they see the resorts surrounding Magic Kingdom as something unattainable. An affordable resort on Bay Lake would certainly build goodwill with families who have longed to stay in shadow of Cinderella Castle.
Now, the Fun Part
With the business case made, it is time to consider what a Moderate Magic Kingdom Resort would look like. WDW historians would immediately look back to the proposed and planned resorts that appeared on maps in 1971. As can be seen in Maps of the Disney Parks: Charting 60 Years from Disneyland to Shanghai, three additional resorts were announced: a Persian theme, a Venetian theme, and an Asian theme. During the Michael Eisner years, the Venetian theme was revisited and discarded in favor of a Mediterranean/Greek Isles theme that also never came to fruition.
Other Disney-trivia enthusiasts, would bring up the idea that each Magic Kingdom area resort represents a different portion of the park (Disney’s Grand Floridian Resort as Main Street, U.S.A.; Disney’s Polynesian Village Resort as Adventureland; Disney’s Contemporary Resort and Disney’s Bay Lake Tower as Tomorrowland; and Disney’s Wilderness Lodge and Fort Wilderness Campground as Frontierland) This theory leaves Fantasyland and Liberty Square without representation. Either land could lend inspiration for unique room designs, dining, grand lobbies and more.
Personally, I have longed to see how Disney would develop the grounds of a Mediterranean themed resort. However, if the target market for this resort is the All-American family (mom, dad, 2.5 kids), I believe the best option would be a well-developed Fantasyland theme: princes and princesses, block walls, an enchanted pool, and medieval food you eat with your hands.
What would you like to see as the theme for a Moderate Magic Kingdom Resort? Do you believe this idea is even possible? Let us know in the comments section or on the WDW Radio Facebook page!
(Bay Lake photo ©Disney. Satellite image ©2017 Google.)
To learn more about Kendall and read her recent posts for WDW Radio, visit her author page by clicking the link on her name at the top of this post.