Disney CEO Bob Iger acknowledged the company was likely “too aggressive” with pricing strategies at its theme parks.
Iger’s comments were made during the Morgan Stanley Technology, Media and Telecom Conference on Thursday. During the interview, he admitted some of the company’s decisions to increase prices in its theme parks had a negative impact on the brand.
“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,” Iger said on Thursday.
Iger said he believes there is a way to grow the business and be smarter about pricing strategies, but he said it’s important for the company to retain a “brand value of accessibility.”
Iger said the company is now taking steps to make “smarter” decisions about pricing at its parks.
“We took certain steps when I came back to do just that, and they resonated extremely well with consumers,” Iger said. “And we’re not only going to continue to listen to consumers, but we’re going to continue to adjust.”
In January, Disneyland Resort announced several updates designed to “offer guests more value and flexibility” in the parks. Those changes included moving the park hopping time from 2 p.m. to 11 a.m., an additional two months of $104 park ticket dates for this year and free attraction photo downloads for all guests. On the same day, Walt Disney World announced a series of updates including free parking at Walt Disney World hotels, relaxed park reservations for Annual Passholders and free attraction photo downloads for people using the company’s Genie+ service.
Iger also said the company needs to find ways to improve the guest experience in the park by reducing crowding.
“It’s tempting to let more and more people in, but if the guest satisfaction levels are going down because of crowding, that doesn’t work,” Iger said. “We had to figure out how we reduce crowding, but maintain, obviously, our profitability. We did that well, but we have to be careful about that as well, because in doing that, you actually end up increasing the price, or putting features into your pricing that are viewed by some consumers as perhaps being too aggressive… and that’s what we have to be careful about.”
During the interview, Iger mentioned the upcoming “Avatar” experience coming to Disneyland Resort. The experience was first announced during the company’s earnings call in February. He also talked about the possibility of expansion at Disneyland Resort and adding new attractions and offerings.
“We actually have more opportunity in California than people are aware,” Iger said. “As we continue to invest in those businesses, which is essentially building out new capacity or new attractions… it gives us the ability to service more people. The more attractions you have, the more people have to do. “
Disney’s theme parks are undoubtedly the most financially successful part of the company’s business. Revenue for the theme parks segment in the first quarter increased by 21% to $8.7 billion.
In February, Disney announced plans to cut 7,000 positions in an effort to save over $5 billion in costs as the company works to make Disney+ profitable.