I haven't studied Divination, the art of predicting the future, at Hogwarts School of Witchcraft and Wizardry, but I'd nonetheless like to prophesy that today, July 8, 2014, marks a turning point for Florida's theme parks.
Anybody with even the most casual understanding of the Orlando area's attractions knows that today's grand opening of Diagon Alley, the second Harry Potter-themed land at Universal Orlando, will generate crowds and additional revenue at the resort for years to come.
What many observers may not fully understand is that one ride, the Hogwarts Express, will likely make a huge impact on attendance, earnings, and the relative distribution of visitors among Florida's parks. It's part of Universal's plan to aggressively expand and capture market share. The Hogwarts Express is an especially bold component of the resort's expansion and transformation.
Universal Orlando has been on a tear lately, developing and building new attractions and making other improvements at a breathtaking pace. For example, it took a mere 12 months to complete Transformers: The Ride 3D from groundbreaking to opening day (speaking of transformation). That's unheard of for a major E-Ticket attraction. The quick addition of the popular ride was largely responsible for an estimated 14% increase in attendance for 2013 at Universal Studios Florida, according to the Theme Index report published by TEA and AECOM.
While impressive, the real game changer for the resort occurred in 2010 when it debuted The Wizarding World of Harry Potter at Islands of Adventure. Although the Potter land was only open for about half of the year, the Theme Index registered a 30% bump in attendance for the park. In 2011, the first full year that The Wizarding World was open, Islands of Adventure experienced another 29% growth spurt.
It leapt from the world's 16th most visited park in 2009 to the 10th position on the global countdown in 2011. Clearly, fans have been wild about Harry.
It's reasonable to assume that The Wizarding World of Harry Potter- Diagon Alley will also catapult Universal Studios Florida, the sister park at which the expanded land is located, to new attendance highs. Because the novelty of a theme park land devoted to J.K. Rowling's book series and the films they inspired has probably waned, the increase might not be as pronounced. But even if Universal Studios experiences a 20% increase in visitors in 2014, or an additional 1.4 million muggles walking through its turnstiles, that could put it on par with Islands of Adventure and move it up a few slots on the worldwide chart. It might also nudge the park into the top 10 and threaten Disney's dominance of the attendance chart's upper echelons.
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The Hogwarts Express is the Engine that Could Drive Success
OK, you're probably thinking, the new Potter land will bring a bunch of new visitors to the park.
They'll ogle at the fire-breathing dragon perched atop Gringotts Bank and marvel at the Escape from Gringotts ride nestled inside the bank. What does the train ride have to do with anything? As my review of the Hogwarts Express attests, it's a wonderful attraction. But it also represents a brilliant strategic move. Here is where Universal's business savvy and sheer bravura, if not bravery, come into play.
With today's opening, Universal Orlando has two Potter lands spread between its two theme parks. The original area, now called The Wizarding World of Harry Potter – Hogsmeade, showcases the Scottish village where the Hogwarts school is located. The new Diagon Alley land portrays the London side of Rowling's mythological landscape. And just as in the books and movies, the two locales are connected by the Hogwarts Express.
Rather than a mere conveyance to move guests between two points (like the monorails at Disneyland and Disney World), the train itself is a highly themed attraction. Whether they originate in Universal Studios Florida or Islands of Adventure, guests are going to want to board the train to get the complete, seamless Potter experience. But here's the thing: It's going to cost them.
In order to get past the conductors at either train station, visitors have to show that they have a two-park ticket. After all, in both directions they are traveling to a separately gated park. A standard one-park ticket to Universal Studios Florida includes admission to Diagon Alley and the London area of The Wizarding World (as a one-park Islands of Adventure ticket grants access to Hogsmeade). But it doesn't allow entry into King's Cross Station where Platform 9¾ and the Hogwarts Express awaits.
Guests trying to board the train with one-park tickets are directed to nearby, handy-dandy ticket booths where they can fork over an additional $40 -- per person -- to upgrade their passes to two-park tickets. That's an extra $40 regardless of how many days of admission they've already paid for their base tickets. A two-day, single-park pass grants admission to either park for two days, but guests can't travel back and forth between the parks, and they can't get on the Hogwarts Express. At the least, the train is going to drive a lot of park-to-park ticket upgrade sales.
How to Train Your Dragon -- and Your Customers
The need to upgrade passes is probably causing some on-the-spot confusion and perhaps some irritation among guests who arrive unaware of what kind of tickets they need to ride the train. But most visitors are likely planning in advance (which is recommended for any park excursion) and know about the necessity of park-to-park tickets. Once they realize they need and are paying for two-park tickets, they are going to want to maximize the value and explore both parks. And once they understand that there is plenty more to explore besides Potter, including great attractions such as Despicable Me Minion Mayhem and Revenge of the Mummy, they are going to consider staying longer than one day. Diehard fans, and there are legions of them, could easily spend more than a day savoring the two Potter lands alone.
And spending more than one day at the resort is something of a Holy Grail for Universal. When Universal Studios Florida first opened in 1990, the typical Central Florida vacationer carved out one day, if that, to break away from Disney World and visit the single park. When the second park, Islands of Adventure, opened in 1999 along with the CityWalk entertainment/shopping/dining district and the on-property Portofino Bay hotel, the calculus of how many days to spend at Universal changed a bit. When the original Wizarding World opened, it changed even more.
Now, two-day visits (and higher; Universal also sells three- and four-day passes) will surely become much more prevalent. Multi-day visits will motivate more guests to consider staying at the resort's (wonderful) hotels and generate more revenue at its CityWalk establishments. And it will all be spurred, in large part, by the Hogwarts Express.
It's not just about higher attendance. It's about how much money those additional guests will be coughing up. In addition to hotel stays and restaurant receipts, Universal has figured out ways to wring lots of other dollars from its visitors and boost per-capita spending to enviable levels. The incredibly popular (and highly addictive) butterbeer costs beaucoup bucks, especially when ordered in souvenir mugs. Along with the new Wizarding World, Universal has introduced interactive wands. As soon as kids see other guests waving their wands and making cool things happen throughout the parks, they will be pestering their parents to buy one -- at a cool $45 apiece. Exorbitantly priced Hogwarts robes, Duff beer in The Simpsons' Springfield land, chocolate frogs: These and other costly temptations abound throughout the two parks and have guests constantly reaching for their wallets.
How to Train Your CEO
When news began spreading that Comcast was in talks to purchase NBCUniversal, many in the theme park community, myself included, fretted that the cable giant, infamous for its notoriously dreadful customer service, would be a terrible fit for the Universal theme parks. Rumors spread that Comcast's honchos weren't interested in the parks and would either spin them off or largely ignore them. That may or may not have been the case.
Regardless, within months of Comcast announcing its intent to acquire a majority stake in NBCUniversal, the original Wizarding World opened. The honchos must have looked at the hoopla, attendance boost, and piles of cash streaming in and decided that the theme parks were a pretty good fit after all.
Lately, Comcast CEO Brian Roberts has been sounding especially bullish. How bullish? "We're doubling down on theme parks," he remarked earlier this year. The recently opened 1,800-room Cabana Bay Beach Resort, the Florida property's fourth hotel, brings the onsite room count to 4,200. Roberts figures that the company could easily build and fill as many as 11,000 additional rooms (although I'm not sure where it could fit them on the property's dwindling available space). "We have a low market share — and only one way to go," said the CEO.
Would Universal's rise be at Disney's expense? Perhaps, but not necessarily. Three of Disney World's four parks took a slight hit in attendance in 2010 when the first Wizarding World opened. They all increased in the subsequent years despite Universal also growing its attendance. If anything, it appears to be a case of Universal grabbing a bigger piece of the pie, but the pie itself is expanding. More visitors are flowing into Central Florida.
Disney is not twiddling its white-gloved thumbs as Potter continues to cast its spell at Universal. The Mouse wrapped up its Fantasyland expansion at the Magic Kingdom this year with the opening of its own train, the Seven Dwarfs Mine Train. It is capitalizing on Frozen's surge of popularity. And it has a large-scale Avatar land at Disney's Animal Kingdom on tap for 2017.
The Orlando-area attendance pie might be growing, but there are only so many slices -- so many days and so much discretionary income -- to go around. Many visitors may be figuring out how to divide their time and dollars between Universal and Disney. The losers could be SeaWorld Orlando, Busch Gardens Tampa, and, to a lesser degree, Legoland Florida, unless they aggressively respond with their own high-profile attractions. May I suggest they consider developing some variation of a train?