How Disney Parks and Resorts Use the Ps in Marketing

While most businesses have suffered from the economic downturn, Disney has managed to sustain their position as a global leader in parks and resorts, even increasing their revenue by $5 billion in the last 4 years. The question is, how are they accomplishing this, and what are they doing differently from their competitors. 

When we look at the financial statements of Disney's Amusement Park Competitions, we see a very dramatic difference. Knott's Berry Farm, or Cedar Fair LP, recorded a loss in net income of $85 million in 2011. Six Flag's Magic Mountain is another Park in the Southern California region that recorded a loss of $102 million in 2011.

A strong marketing strategy is what separates the top companies from the ones that are struggling to survive within the industry. To briefly understand how to distinguish the two, we will look at the 2 of the 5P’s in marketing: positioning, and pricing.

Establishing Strong Positioning
Positioning could arguably be the most important out of the 5P's in the marketing strategy. Positioning is essentially what consumers think of a certain brand.  As quoted from Philip Kotler, positioning is “…the act of designing the company’s offer and image so that it occupies a distinct and valued place in the target customer’s minds.” In order to position a brand, there are 4 things that should be considered:

            1) Target Market - who is the target consumers?
            2) Nature of Competition/Category – what is it that you are selling?
            3) Points-of-Parity – how are you similar to your competitors?
            4) Points-of-Difference – how are you different from your competitors?

When we look into Disneyland’s positioning, we can see that they are extremely successful in occupying a space in the target consumer’s mind. Disney is the epitome of family entertainment – the brand is valued by children and adults alike. Disneyland Parks and Resorts is selling an experience – a destination that has been dubbed the “happiest place on earth.” If we get down to the main core, Disney is essentially selling happiness, and going to their amusement parks is a way to get it. Achieving happiness can be considered a universal desire, and resonates with a wider audience. The memories that are created, and feelings associated with their visits is what makes Disneyland able to encourage repeat visits.

In contrast, Six Flags and Knott's Berry Farm have not been able to create a strong positioning, which is clearly reflected in their current financial status. Without doing any research, can you recall Six Flag and Knott's slogan? Even though I had been to Six Flags and Knott's many times, I still had trouble remembering. Six Flag has the slogan "More Flags, More Fun," and Knott's Berry Farm's "American's 1st Theme Park." The fact that I had to search for their slogan suggests that they do not occupy a distinct place in the consumer's mind, or have a strong enough positioning.

Pricing
Pricing can become a tricky business. The goal is to find the perfect balance between what consumers can afford, and how much they are willing to pay for an admission ticket. The most common pricing strategies are:

            - Value Pricing                                                - Hi, Low Pricing
            - Everyday Low Pricing                                  - Premium Pricing
            - MAPP Pricing                                              - Luxury Pricing

Unlike everyday low pricing (which offers low prices consistently), premium pricing marks up the price consistently, to the highest possible range that will still attract consumers, and stopping before the point where the target audience feel like it is unattainable.

In the past few years, the admission fee to Disneyland has increased annually. Right now, a 1 Day, 1 Park ticket is $80 for adults, and the 1 Day Park Hopper is $105. For Knott's and Six Flags, their tickets are in the $40-50 range. However, Six Flag frequently offers discounts (bringing Coke cans to get 50% off), and Knott's discounts can often be found at supermarkets. Unlike some of its competitors, Disney rarely gives discounts on single ticket purchases. The common perception is that when the price is being lowered, the quality is also affected.

Key Takeaways 
The rule of thumb to successful marketing is to have the P's be consistent with one another. A clear connection can be made between Disneyland's positioning and pricing. By maintaining their premium pricing strategy, Disney is able to remain “the best” in the consumer’s mind. However, we must keep in mind that it is because of how strongly establish the Disney brand is in the consumer’s mind that allows them to successful charge their admission fees at a premium price. How these two intertwine so naturally is indicative of how successful and strong the Disney brand is.