- Share this article on Facebook
- Share this article on Twitter
- Share this article on Flipboard
- Share this article on Email
- Show additional share options
- Share this article on Linkedin
- Share this article on Pinit
- Share this article on Reddit
- Share this article on Tumblr
- Share this article on Whatsapp
- Share this article on Print
- Share this article on Comment
This story first appeared in the June 22 issue of The Hollywood Reporter magazine.
On June 15, after a five-year effort that cost more than $1.1 billion, a huge overhaul of Disney’s California Adventure in Anaheim will be unveiled. The reboot includes the opening of a two-acre Cars Land, based on the popular Pixar Cars movies, where the main attraction alone, Radiator Springs Racers, cost more than $200 million, the most expensive ride ever made. It’s all designed to revitalize a theme park that had been a disappointment since it opened in 2001. Disney chairman and CEO Robert Iger, speaking May 30 during a Wall Street investor conference, called California Adventure “a park that was not up to standards” and “a bit of a brand eyesore.” But now, he said, “Cars Land is the culmination of the expansion we started in 2007 with attractions Toy Story Mania!, Little Mermaid and the spectacular World of Color.”
PHOTOS: The ‘Star Wars’ Universe: $20 Billion Worth of Toys, Rides, Books and Games
The reincarnation is only one of the highlights of what promises to be a blockbuster summer at major theme parks worldwide, reflecting the overwhelmingly successful results of a new industry mantra: Theme parks need tentpole attractions, just like the movie business. And if it’s the right tentpole — such as Universal’s The Wizarding World of Harry Potter or Avatar for Disney’s Animal Kingdom, a work-in-progress — it can make or break a park’s success, generating all kinds of revenue streams: from hotels, food and drinks to merchandise and, of course, admissions, which start at about $80 for a child’s one-day pass but get packaged in an endless variety of ways, including discounting and local ticketing specials. “Harry Potter has proved to be not only effective in producing a large attendance increase,” says John Robinett, senior vp economics at AECOM, a parks consulting firm, “but also an increase in retail because food and beverage tied to the Potter theme is very popular. You get 30 percent or more people in your park, and each one is paying for admission and park expenditures.”
Plus, long after guests have stepped off their last dizzying ride, stuffed themselves with Hogsmeade sweets and butterbeer and waved good-bye to the costumed characters at the exit gate, their enthusiasm will create a halo effect, generating revenue outside the park in the form of DVDs, holiday gifts and movie tickets, as well as franchise sequels and Imax and 3D versions. “The big importance to these conglomerates,” says Craig Hanna, a former Universal executive who founded consulting company Thinkwell and now directs attraction development, “is to hit as many touch points and get as many eyes on as many products as they can. If you’re Comcast or Disney and can put those intellectual properties in front of consumers through websites, movies, products and theme parks, they all benefit one another. All boats rise with the tide.”
STORY: Universal Studios Japan to Open ‘The Wizarding World of Harry Potter’ in 2014
Between Universal Studios Orlando’s new ride based on the animated hit Despicable Me opening this summer and the just-opened Transformers: The Ride 3-D at Universal Studios Hollywood, this summer’s park tentpoles will, at the very least, continue to push the steady rise of profits back up from the 2008 recession. “I think the Transformers ride had the biggest Memorial Day and weekend they’ve ever had, a tremendous success,” said Brian Roberts, CEO of Comcast, which owns Universal Parks & Resorts, at the May 30 investors conference. “As the economy hopefully recovers, that business will get better and better.” So far, the numbers are trending as hoped: Combined, the Universal and Disney parks in Orlando enjoyed 61.2 million visitors in 2011, 3.7 percent more than in 2010. Disney Parks & Resorts alone experienced a 10 percent revenue increase to $11.8 billion. With the world’s No. 1 theme-park group generating 30 percent of overall company revenue and 20 percent of profits, that’s good news indeed. (Universal Parks & Resorts 2011 revenue was $2 billion, just 4 percent of Comcast’s overall revenue.)
The crux of theme parks’ swooping comeback has been big attractions like Universal Studios Orlando’s Harry Potter, which opened in 2010 (it’s now being doubled in size, and other versions are being built in Tokyo and Los Angeles), and the rebirth last summer of a Star Wars‘ Star Tours attraction at Disneyland. The impact of Harry Potter, with its Dragon Challenge and Hippogriff rides, Hogwarts castle tour, shopping at Hogsmeade and dining at Three Broomsticks restaurant, can’t be overstated. “Suddenly, when you create an attraction like Harry Potter — a whole world, not just a ride — your attendance goes up by millions, not hundreds of thousands, and per capita spending goes up by hundreds of millions,” says Gary Goddard, founder of The Goddard Group and a former Disney Imagineer, or theme-park designer, who has created attractions all over the world. “Harry Potter has been the best thing to happen to Universal Studios since the park opened [in 1990].”
STORY: Universal Studios Confirms Harry Potter Park Heading to Hollywood
In its first year, Potter land, estimated to have cost $265 million, drove park attendance up 30 percent, or 68 percent to date. Last year, it was a key factor in a 24 percent revenue increase for all Universal parks and, with its attendance jump of 1.72 million, accounted for almost half of the attendance bump for the top 20 North American parks combined.
The success of the Harry Potter attraction was the trigger that led Disney to do a deal for a park built around James Cameron‘s Avatar that is scheduled to open in Disney’s Animal Kingdom in Orlando in 2015. “Harry Potter opened Disney’s eyes to what an attraction could be like,” says Jessica Reif Cohen, a media and entertainment analyst for Merrill Lynch, “and they consequently commissioned Avatar, which was not part of its franchises. That was very interesting.” (Universal has been licensing outside properties for rides since at least 1990, from King Kong and Transformers to Jurassic Park and Marvel’s Spider-Man — the last one a point of contention after Disney acquired Marvel in 2009. Spider-Man and Marvel’s Super Hero Island, both at Universal Studios Orlando, existed before the Disney acquisition, but Disney already is laying claim to its latest properties by wrapping its Walt Disney World monorail in Orlando in Avengers iconography.)
VIDEO: Disney Park Denies Admission to Girl Dressed as Tinker Bell
The Avatar attraction, to be developed by Disney and overseen by Cameron, who owns half of the property along with Fox/News Corp., marks a departure from the Disney way and is sure to result in one of the most expensive attractions ever, possibly exceeding $500 million. “Disney could keep using its own stuff, but it had to look at the fact that it hasn’t come up with anything in a number of years on a level of Avatar or Harry Potter,” Goddard says. “Also, its challenge is that Animal Kingdom has never done the numbers it wanted, unlike Magic Kingdom, Epcot or Disney Studios. By putting Avatar in Animal Kingdom — if they do it well, which I presume with Cameron they will — they will bring that entire land to numbers that are where it wants them to be.”
The artillery that makes park-boosting attractions like an Avatar or Harry Potter a winner in the parks arms race is potent. Goddard, whose credits as a designer include Terminator 2/3-D and Jurassic Park: The Ride, both for Universal Studios Hollywood, and Star Trek: The Experience in Las Vegas, says firstly, the choice of franchise was correct: “Instead of legs for months at the box office, you want legs for years. Harry Potter, which is pretty much in the consciousness of a whole generation of kids, will go on and on.”
Also, the design process was a departure from the traditional: “When you have heavy involvement with J.K. Rowling or James Cameron,” he says, “they get to shortcut the normal management review process and keep the vision intact over a four- to six-year period. I think the Universal designers were very happy because they got to break so many rules,” for example, using real doors in Hogsmeade’s shopping area that can actually close, with a little bell that rings when you enter, instead of super-wide ones that stay open with air blowers to entice people inside. “It’s just like in the movie,” Goddard says. “They brought back real themes and did their best to re-create the Harry Potter world as it exists in the author’s mind.”
Adds Hanna, who designed the Potter opening event: “If you go back to those very first attractions, what Walt Disney put into Fantasyland, those are what we like to call ‘book report rides.’ They were just a retelling of the film. These days, audiences are much more sophisticated and want to be surprised. So we talk about the ‘one-point-five’ version of the attraction: It’s got bits of the old and bits of something new. For Harry Potter in Orlando, Universal developed whole new unexpected situations based around the characters and settings we loved from the films. Same with Transformers; we’re met with the characters we know and battles similar to the ones in the films — but in a new story context.”
Hanna says that development budgets can range from $35 million to more than $200 million, with, adds Goddard, “thousands of people, like any motion picture, involved in bringing it to life.”
Refurbishing a park may boost the bottom line almost as much as developing a new attraction from scratch. “A strong reinvestment will tend to give you a 5 to 10 percent increase in attendance. You have to reinvest in attractions; otherwise, attendance tends to erode over time — that’s a rule of our business,” says AECOM’s Robinett. “What we’ve seen is making large investments in these intellectual property-themed family attractions can counter the business cycles, so while we’ve had a bad recession, many theme parks have continued to reinvest and see attendance grow.” For example, using Cars Land to spearhead a refurbished California Adventure was part of a strategy to “encourage multiday stays, hotel traffic and park hoppers” — $120 passes that allow guests to go to California Adventure as well as Disneyland — says Michael Nathanson, an analyst at Nomura Securities, which follows media and entertainment markets. “These are all ways to monetize what was an unrealized park.”
The resuscitation of amusement parks as capped by this summer’s tentpole attractions is the tail end of a slog back from 2008, but recovery hasn’t taken as long as expected. Says Robinett: “When you have long recessions, people have waited so long, there’s a pent-up demand for leisure activities and family experiences. People need to blow off steam and escape their worries for a day.”
For 2012, Alan Gould, a media and entertainment analyst at investment firm Evercore, projects attendance will increase 3 percent domestically and per capita spending 4 percent. “Adding in international, revenue this year is about $13 billion, up 10 percent in the park business,” says Gould. “Operating income is $1.9 billion, up about 25 percent. We have a big year here.”
Expect the roller-coaster ride to continue to ascend for now as consumers are reminded of the adventures theme parks have to offer. “We do them in a group — I don’t ride a roller coaster by myself and give myself a high-five when I’m done,” says Hanna. “I get off and turn to my best friend and say, ‘Oh my God, we survived!’ That’s the shared experience you can’t get at home from TV, the Internet or your iPad.”
6 OTHER AMUSEMENT PARKS WITH NEW ATTRACTIONS
Magic Kingdom (Orlando)
Orlando Opened: 1971 | Attendance: 17.1 million
Fantasyland will double in size by 2013, part of a multiyear project for the world’s most attended park. The first phase opened in February, when Sorcerers of the Magic Kingdom offered a new interactive experience enabling guests to battle Disney villains. On Aug. 15, the Enchanted Tiki Room replaces Tropical Serenade, with a Polynesian show featuring birds, tikis and flowers brought to life.
Disney’s Animal Kingdom (Orlando)
Opened: 1998 | Attendance: 9.8 million
At 500 acres, the largest Disney park in the world is ranked No. 4 in North American attendance and is the only one with an animal-conservation theme. Seven areas, including DinoLand USA and Discovery Island, are built around a zoological park on Discovery Island. Guides take guests on a bushwalk in customized vehicles though jungles and across an animal-filled savanna. This will be the home of a new Avatar attraction by 2015.
Tokyo Disneyland (Tokyo)
Opened: 1983 | Attendance: 14 million
Closed after the March 2011 tsunami and earthquake, this park, ranked No. 3 in worldwide attendance, reopened less than two months later. New this summer are Disney’s Natsu Matsuri, a celebration of a Japanese summer festival with daily dance competitions, and Goofy’s Paint ‘n Play House, where guests help Goofy paint his room using activators that apply color when aimed.
Hong Kong Disneyland (Hong Kong)
Opened: 2005 | Attendance: 5.9 million
Co-owned by Disney and the Hong Kong government, this park, which ranks No. 16 in worldwide attendance, was a disappointment at first but has steadily added attractions. In November, Toy Story Land opened, where guests experience what it’s like to be the size of a toy in Andy’s backyard.
Universal’s Island of Adventure (Orlando)
Opened: 1999 | Attendance: 7.7M
The hugely popular Wizarding World of Harry Potter opened in 2010, helping this mini-park achieve a No. 6 ranking in North American attendance, and it will soon double in size. Popular since 1999, the Amazing Adventures of Spider-Man hybrid ride was relaunched in February, bringing Spidey to life with state-of-the-art animation and 3D effects. This summer, the Universal Cinematic Spectacular will play daily across a six-acre lagoon at sunset, weaving scenes from more than 200 Universal movies, with narration by Morgan Freeman.
Universal Studios Florida (Orlando)
Opened: 1999 | Attendance: 6 million
Opening this summer will be Despicable Me: Minion Mayhem, a motion-simulator 3D ride based on the animated movie, followed by a dance party where costume characters teach line dancing. The first permanent Universal Superstar parade of the park, which ranks No. 8 in North American attendance, opened in May, with a daily procession of floats, characters and more than 100 dancers and singers.
Sign up for THR news straight to your inbox every day
More from The Hollywood Reporter
Taika Waititi, Eva Longoria and Niecy Nash-Betts Talk Leading the Diversity Charge at The Hollywood Reporter’s Raising Our Voices Luncheon
Tallulah Willis Opens Up About Coping With Father Bruce Willis’ Dementia, Says She’s “Known Something Was Wrong for a Long Time”
Sharon Stone Discusses Challenges With Getting Work Since Her Stroke, Rails Against “Anti-Woke Bullsh**” at THR’s Raising Our Voices Event
Harassment in Hollywood
Los Angeles District Attorney Decides Against Bringing Charges in Armie Hammer Sexual Misconduct Case
Boston University President Accuses 2023 Graduates of “Cancel Culture” After They Boo David Zaslav During Commencement