Disney implements surge pricing, meaning  guests visiting busy days pay more. I am not sure why there is so much fuzz. It is economics 101. Higher demand, higher price. Given that Disney’s supply of entertainment is not flexible (cannot suddenly make new attractions) and that there are no good substitutes for Disney World (Yes, Disney has convinced us that it is the happiest place), surge pricing seems only natural.

Although people may complain that Disney is milking the consumers, it is simply economics. Disney may be the happiest place but it is definitely a public firm that has responsibilities to shareholders.

Is surge pricing that bad? Well, it enables consumer segmentation, increasing Disney’s profit and also making the park less crowded, which will raise all the visitor’s well-being. It may also help lower the cost for both the company and the consumers since lot of bad things happen when the park is too crowded. For instance, if the park is too packed, it is hard for anyone to enjoy the place and it is super stressful for employees and the rides/ facilities may depreciate faster due to excessive usage. Hence, in the long run, Disney’s surge pricing may be beneficial for everyone.

Is there another way that Disney could have done a better job? Maybe. Further price discrimination includes charging premium for early hour access and giving a discount for late hours or when there are less people in the park. This will further raise the efficiency. However, given that Disney World represents an ideal place, less prone to economic forces, Disney has limits in pricing schemes.

 

 

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