Mitigating the Rush

Philip: From our studios in Los Angeles and Tampa, FL this is Green Tagged Theme Park in 30. I'm your co-host, Philip, and I'm joined by my co-host Scott Swenson.

Scott: Hi everybody.

Philip: Well, the new MagicBands are coming, Scott, here in summer. While Disney World Resort announced, officially, that their new MagicBand Plus will come out this summer and will not only continue the features that the old MagicBand has, but it will also unlock new interactive experiences, including Star Wars Batuu Bounty Hunters in Galaxy's Edge. Now the article we're going to is courtesy of Attractions Magazine, they have a kind of a good outline of the different things. But basically, there's the Disney Fab 50 Quest, which is a scavenger hunt throughout the Walt Disney World theme parks, and it uses the MagicBand Plus to interact with the golden character sculptures, which is really funny because I'm like, "Oh, that's what they're for." For example, will offer hints and keep track of the sculptures found which unlock digital achievements using an augmented reality feature.

Then there's the second thing that's part of this launch is Batuu Bounty Hunters. The copy here says guests can join Batuu Bounty Hunters Guild in Star Wars Galaxies Edge at Disney's Hollywood Studios and use their MagicBand Plus to find virtual bounties hidden throughout Black Spire outpost. The Band's light patterns and haptics will guide guests to complete their mission, then they can return to local Guild master to be rewarded with galactic credits. Guests can also use the play Disney Parks mobile apps built-in augmented reality thermal viewer to reveal their virtual bounty. There's also some like glow with the show element.

So, wow, increased functionality. What do you think Scott?

Scott: This is, we've had this discussion before about having to pretty much plan your entire life when you go to Disney. It's a lot more work than it used to be. I think this is another step up in that direction. But I also think this added functionality is a unique way to sort of sidestepping it, I guess? Sidestep the negatives. In other words, in my opinion, what it's doing is it's creating attractions that don't have queues. So, instead of waiting in line to see one of the key attractions. It used to be that you'd spend your time walking around Magic Kingdom, for example, and you didn't mind not going into every single ride every single day because you got to see the characters, or you got to see the parade, or you got to see this. This is the high-tech version of that. This is creating, in essence, a virtual attraction that doesn't take place in one location, it takes place around the entire property or the entire area of the property. Obviously, Galaxies Edge is within Galaxies Edge, but it makes Galaxies Edge as a whole an interactive guest experience. So, if you're unable to reserve your time, you know you don't get up at 4:30 in the morning and reserve your time on a Saturday to do one of the actual rides, you can still get something out of Galaxy's Edge if you have a MagicBand Plus. 

So it's another one of those steps in the velvet rope that we've talked about. It's another level of engagement, and it's a level of engagement that, again, is going back to the old days of selling the tickets. This is like your C ticket, you know? This is the C ticket attraction where you can get to experience a bunch of Galaxy's Edge, and there are people out there who may absolutely love this. I can see that you know families with the right age children would just have a blast. OK who am I kidding? I can see Star Wars fanatics who are my age, who would have an absolute blast running around watching the wrist blink. So I mean, I think that's cool, and the digital stuff, you know, all of the rewards have 0 cost. They're zero cost of goods, there's obviously cost of development, but zero cost of goods, so they're all digital, virtual, we've heard that we heard those phrases multiple times in what you just read.

So, I think it's clever, and I think I think it's a distraction so that people don't have to recognize, "wow, I went to Disney, and I didn't get to ride all the things that I wanted to ride. But I did watch my wrist blink!" So, you know? Again, I'm being overly simplistic and a little bit glib, but I don't know, I'm getting less and less interested in the Disney properties, and maybe it's my age. I will completely admit that. I don't have small children, I don't have grandchildren, I don't have any children and so that may be part of it. I am a huge supporter of the Disney brand, or I have been throughout my life. I've always enjoyed it and had a great time, and especially the IPs that they have purchased over the years, those were also interesting to me. But it is becoming, for me, far too much work and far too nickel and diming to actually enjoy the parks and experience them as a guest. I know that's an unpopular opinion. I know that doesn't embrace the technology moving forward.

That said, I do credit them for at the very least, trying to find ways to make entire realms, or even entire parks, an attraction. I just wish it had more of the magic that I expect from Disney, and not just the MagicBand Plus flashing light patterns. That's my own take on it. So, I don't think it's a bad thing if that's what you enjoy. I'm just saying, it's not the wonder that I used to experience at Disney Parks when I used to go on a regular basis. I understand why it's there, it's just not for me. 

Philip: You had a lot of valid points there. I think I agree and disagree in some places. I agree that I think it's going to come down to execution. This is very vague and I'm not sure if they meant to, I think this got leaked is what it was. Basically, you know, that some of them got put out on the shelf by accident, apparently, and then they like went and took them back.

Scott: "By accident." Yeah, uh-huh.

Philip: Yeah, maybe, we'll see, I don't know. But I think it comes down to the execution and what the execution would be like. Honestly, this is literally, this technology is exactly what we had developed at Gantom which we received the THEA for, which is torch technology. Our sister company Z-Tag has made this exact thing, it's a wearable, it lights up, it does all that kind of stuff. 

I really don't know, because the MagicBands were a big investment, but they kind of were a failure because ultimately your cell phone can do everything the MagicBand can do, so you don't really need it. I'm afraid, depending on the execution, this might fall into that same category. The reason we have insight into this is because we literally, our sister company Z-Tag, that's what they make. They make a wearable that lights up, you can go around and play different game modes with it, it has a proximity sensor in it, and all that, it keeps score, does all these same things, interacts with the environment, it has a receiver and the transmitter. So, the reason though, that it needed to be a wearable, in that case, is because you are interacting with other guests, there's guests on guest interaction. That makes it difficult if you're holding up your phone and you're trying to chase each other around with your phone out. It's like it's like running with scissors, right? That's not a good thing. So, this it makes you more able to run around and interact with other guests in a tag setting. 

So, I don't know why this MagicBand is needed right now. Reading, just based on what they're saying I'm like, this could have been done with your cell phone and it could be an extension on the park's app. I don't know why we need the extra MagicBand other than they want to... Basically, they're like if we if we add a tiny bit...

Scott: Sell more MagicBands.

Philip: Yes, correct, sell more MagicBands. Basically, they're like if we add a tiny bit of functionality, like a very tiny uptick in functionality... Now, to be fair with them, having insight into making this and how much they cost, it is going to cost significantly more for these MagicBands because they have to have the LED, the display screen, and the light up stuff, and they have to have that transmitter. So, it definitely is going to cost more, significantly more, but they're going to charge you, I'm sure, significantly more because of that. It's going to be probably a wand price point, or a little bit lower than that, and so it should make up for it. So, I don't know. What I would like to see, because our original pitch was always, what you want to do is use this to create a better story experience, not just an ancillary like Scavenger Hunt. So again, depends on execution.

Like, what I would like to see, which I think would be possible with this, is that they go and you join the Guild there in Batuu, and when you earn enough Guild credits, your status as a Guild member is displayed here. So, you rank up to being a better adventurer, basically, like a better bounty hunter. Then, there are passageways, or areas, that only high-status bounty hunters can get into. That is what this needs to be. That gives you a reason to be wearing this wristband to have it displaying your status, so that people can see it, and then you can get into an area that you can't normally access.

Scott: And it's possible that may be down the road too. 

Philip: That's why I mean execution.

Scott: But my concern there is, and it's going back, I'm agreeing with you 100% here, it goes back to execution. First of all, this does not sound like that's what they're doing, so that's not where they are. 

Philip: I know.

Scott: I also think they're trying to find that balance, and this is a challenge, they're trying to find that balance between the tech and the guest’s acceptance of the tech. I know, and again because you and I have talked and I'm very familiar with Z Tag and its pluses and minuses, and it's one of the challenges that Z tag has had to overcome as well. But the difference is, as you said, Z tag is interactive between humans, this is interactive between experiences. So, it's wand technology that's the best issue. 

I'm sorry I don't mean to tell tales out of school, but you ran into the same thing with Gantom Torch. Gantom Torch was, "how do we know that it's the torch that's actually making this happen? Could it not just be a proximity sensor? Could it not just be..." You know there were other ways to make this happen, so just like the MagicBand could it be a Cell phone? Could it just as easily be a cell phone? 

Philip: The answer is yes.

Scott: The answer is yes. But, you're not going to sell somebody a brand new cell phone when they come to the parks, you do have to sell them a MagicBand. So, yeah, I get it. I understand it. Like I said, the reason it turns me off is I feel nickel and dimed, but at the same time, I also applaud them for trying to at least explore options of experiences that are outside of the queues that you may or may not be able to get into, depending on how early you make your reservation, or how long you want to stand in the stand-by line.

Philip: Yeah, we'll see. We'll continue watching this, of course, and we'll see what they develop. I'm just hoping that they'll use it as a way to denote status and get... I mean because even now, at Disneyland, there are specific areas that are only accessible to Magic Key holders, usually during food festivals. I like those areas because there's less people in them when you're trying to find a place, a table to eat, you know for the food tasting. They send you a magic key pin, and so they still need to scan your thing to make sure that you have a valid pass, right? But the cast members there, if they see wearing the pin they'll be like, "oh, welcome back, let me..." Again, it's like human-to-human interaction, they see that you're...

Scott: They'll help facilitate the situation. Yeah.

Philip: Yes. So, I think if this could be rolled into that it would change my opinion. Anyway, OK, let's move on. We have three stories we're going to tie together now, and these are kind of quick updates on earnings and hiring. So, the first is from SeaWorld Entertainment, and they reviewed their Q1 results. They reported $271 million in revenue during the first quarter of 2022. That's an increase of $99 million during the same period in 2021. They also, you know, as we've been talking about, they release all these new plans and they they're looking at welcoming 3.4 million guests during that quarter, which is pretty good. But just to highlight here that that is still a loss of $9 million. Now, it is the smallest net loss, but it's still loss.

Scott: So, it's the best of the worst they've had. Again, I think this is great news, I'm thrilled that they're getting this money back, the revenue is skyrocketing, but any time I read a report that just talks about revenue and not profit I start to raise eyebrows.

Philip: Be suspicious? Yeah.

Scott: I start to raise eyebrows because it's like, to me, you're blowing smoke here. We actually were able to get to this point by glomming together 2 two different articles to kind of come up with a bit more truth. Now, I'm not trying to be negative towards SeaWorld or any of the companies that we're going to talk about here, but I just want people to recognize, theme parks are still hurting.

Philip: Some theme parks are still hurting.

Scott: Some theme parks are still hurting. Some attractions are still hurting. With the ones that aren't, who knows whether they really are not. We don't really know that either. But, based on what we're seeing here, they're coming back, these are great strides. But, I mean, if you look at it, if you are a small attractions owner and you have gone a long-time losing money, I'd be surprised if you're still open. So, these major parks are still in that in that position. So, I think it's just important to recognize, yes, there are plans. Yes, they are coming back. Yes, they're coming back quicker than they actually had originally projected, which is wonderful. But I just want to put it in perspective, that's all. I want to make sure that we're not looking at this going, "wow, they made 271 million in the first quarter, they got to be rolling the dough." But that was still $9 million shy. 

So, I just want to make sure that we all understand where these numbers are coming from and what they actually mean. Obviously, business is not going to flip back like a light switch, we've said that over and over again. I'm not trying to be negative; this is not Scott dissing the companies that we're talking about or the numbers. I just want to make sure that we're viewing them in a realistic setting, and that we all understand kind of what they mean.

Philip: Yes. Cedar fair is in the same boat where, they still lost money, but not as much money. They generated $29 million in net revenue in the first quarter, and that was their highest first-quarter attendance for the company since 2013, which is bonkers. Despite all of that, they still sustained a net loss of $88.5 million for the first quarter. It's an improvement over the same period in 2021 where their net losses were $110 million. So, a much slower recovery for Cedar Fair, it seems like, proportionally, but what both of these stories, all three of these, are going to show us is that demand, as we have been saying, is coming back, it's proving in the numbers, even in Q1. Just remember, Q1 is usually the slow Q. It's usually the slowest quarter because everybody is recovering from the holidays, and no one going out. We still had, you know, pandemic stuff going on, if we push our brains back to January. So, basically, there were still concerns, and despite the concerns and despite the slowest quarter, we've had this much of an expansion. All that is positive. 

The last story here is that universal is hiring 5,000 jobs. Just as a note here, in February they announced it was 2500, so now it is 5,000. So, they definitely have doubled the amount that they were looking for summer. Their starting wage is $15 an hour, for some of them, but for culinary jobs they have raised that to $16.50 to $20.00 an hour, depending on the position for culinary. So, basically, everything is $15, but there are certain positions, some of them are including culinary, certain positions that they are raising to $16.50 up to $20 for some of those, and they're looking at 5,000. Those are the takeaways. That's a lot, that's a lot of people.

Scott: It's a lot of people and anybody who is working in the industry is laughing at that. Because you can offer all these jobs that you want, the challenge is filling them. I've got clients all over the United States right now, and there's not a single client, this is the only thing I have ever been able to say across the board, there is not a single client who feels comfortable with their staffing and getting staffed up for the summer season. There is not a single client I have that feels comfortable that they are going to be able to get the numbers they feel that they need for this huge rush, like we've just talked about, of people returning to theme parks.

So again, this is great for Universal Orlando, but keep in mind, they're also competing with SeaWorld that we just talked about, they're competing with Disney that we just talked about, they're competing with Wet and Wild, they're competing with International Drive, they're competing with the Convention Center, they're competing with every restaurant on Restaurant Row in Orlando for these bodies. So, I'm thrilled that there's this much work out there, the challenge is going to be getting people to actually take the jobs.

This is something that that I know Philip and I have talked about many, many, many times in the past. I love seeing these numbers, I think these are getting to be fair wage numbers. But again, it's now become commonplace in Orlando to see these numbers. So, what are you going to do for your employees that is going to make it more? What is going to make it so they want to come be with you? What is going to make it so that they want to stay with you? So, you don't just train them, they get their comp tickets, they go to the park a few times, and then they quit. Not that that would ever happen, of course, but that's gone on forever, and it's even more prevalent now in the world of post-pandemic.

I just sound like such a downer today. I'm so sorry but it's the reality of the situation. I'm glad. If you want a job and if you want to work in a theme park, come to Orlando for the summer. If you're listening around the country, come to Orlando for the summer. I would guess that if you're anywhere near a theme park, you're going to run into something very similar in your own neighborhood. But, you know, there are jobs there. There is work to be had, and it's not $11.00 an hour, it's $15 to $20. I will say that part of the reason culinary, and this is just based on my own experience, part of the reason that the culinary numbers are higher is culinary is notoriously difficult to keep staffed in attractions, because it is not an easy gig, and it operates very differently from restaurants. So, you can't even get people who have culinary experience because restaurants are actually simpler to work in, they're easier to work in than a theme park culinary place.

Philip: I want to just put in a little bit of my perspective on that. They are very difficult jobs; I have worked in all of these areas before when I was younger, I'm not sure I have the energy to do it now, I don't feel like I could manage it because it's very demanding. But also, just keep in mind, those attractions that are listening, that maybe if you think that this is high for a culinary role, you are not paying enough for your culinary role. That's because F&B and merch are big profitability centers for your attraction. We've talked about this a lot, but just to drive this point home, you make a themed food experience and then you have people there serving it, and if they're selling a $12, $15 to $20 item or whatever every like few minutes, it's definitely worth the costs of paying them competitive enough to keep that area staff. So, I just I wanted to highlight that.

Scott: Yeah, restaurants don't make money if they're not open.

Philip: Yep, yes correct. Restaurants in parks are particularly profitable because a lot of the infrastructure is already there, the people already there, you have the infrastructure in place.

Scott: And you're charging premium prices, you're already charging...

Philip: For not restaurant-quality food and no need to like serve them and all that. So, it's a good combination.

Scott: You're selling me an $8 can of coke. I mean, you know? 

Philip: Yeah, and people line up for it.

Scott: Yep, Yep, and I will say that on paper, and this only comes from my experience and as well as my observations since I left being part of the management team in a theme park. On paper, quite often it will look as though, "well if we don't open this snack shop, and we don't open this snack shop, and we drive everybody to this main restaurant, then we'll still make the same amount of money with less labor." That is not true. There are situations where, and I've seen it happen, I've actually seen it happen this season already with some of my clients, the line gets too long and I will watch guests say, "OK, we'll just eat at home." So, you are losing money. There is, of course, a balance here, and I don't have the actual magic number, but once again, a restaurant cannot earn money if it's not open. So, to reinforce Philip's point, it's worth the $15 to $20.00 an hour to you, not to them, to you, to get those bodies there and to sell the $8.00 cokes.

Philip: Yeah, plus one last thing, we need to move on but one last thing. Perceived time in line will discourage those purchases, so just keep that in mind. You are losing money if the line is too long, so just keep that in mind.

OK, our last smaller topic here to close out the show is about when you do hire all these people and you get your team in to meet this demand, what are you going to do to combat some of their concerns? One of their big concerns is going to be violence against the performers and against your staff members. This is a topic that Scott did a podcast on, so I'll let him introduce it.

Scott: Well, I mean, we're living in a world now where millions of people have watched people of power and respect go after each other, and basically commit a crime, the crime of assault, and get away with it. I'm not just talking about the Academy Awards; it's becoming more prevalent. I think people are starting to feel either empowered that if they disagree with somebody, or they just don't like them, or they've had to wait in the queue line for too long, they can react physically. I so hope, and this is the way, spoiler alert, I finished my podcast by saying, I hope that everything we just talked about is completely unnecessary, but I would rather have these discussions now and help prepare so that fewer and fewer people get hurt. I think there's a monkey see monkey do mentality out there that, you know, these people have seen, "Well, it's OK for someone to walk up and slap somebody else across the face with plenty of witnesses, and nothing is going to happen. Nothing is going to happen, or nothing is going to happen immediately." So, I just think it is important to recognize that this trend could become something that is going to impact attractions. Philip, I know you did some reporting on the Halfway to Halloween, the companies that opened up their attraction their Halloween attractions for Halfway to Halloween

Halloween, by the way, when it comes to violence against performers and employees, is significantly higher on the list. You're putting people into the dark. You're raising their anticipation. You're feeding them alcohol, and then you're scaring them. So, it's always been an issue with Halloween. I'm just concerned that it's now going to trickle over into other forms of... I mean, we've seen it on airplanes, I've seen those reels. We've seen it on airplanes, and I think we're going to start seeing it in attractions, so I think we just need to continue to prepare our folks. But you had to actually had some stats, some data that you got from your reporting on Halfway to Halloween, right?

Philip: It's nothing that I would call actual data, what I got was examples of this kind of picking up. To walk it back a little bit, you know, even since last year when I was doing reporting, we would contact the attractions that check in with them and see how their seasons were going. Even since last year, and up through November when haunts were open and I was reporting with them, one of the main 3 themes that I heard was increased violence. Increased violence against our performers, and increased all sorts of, even if it wasn't physical violence, which is attitude and a lot of talk back, a lot of verbal abuse to their performers and their team members. We saw this, we saw like 6 shootings last year for people that were at attractions, and most of them were just people that were in line, just while they were waiting in line. Stabbings, you know, all those kinds of things increasing in the lines. 

Even to the point where we saw, of course, lest us forget that Six Flags last year had to close two of their parks early and institute a new early closure for their Halloween events because of the violence that would happen in the parking lots and in the round there. They had to institute a clear bag only, or no bag policies. We even saw smaller attractions instituting those clear bag policies just to prevent people from bringing stuff in. But even the smaller attractions that didn't have those issues that I talked to, like Reign of Terror here locally, you know that was his biggest take away from the season, that people didn't know how to be around other people anymore, verbal abuse, violence, that kind of stuff.

Scott: Yeah, that's exactly it. You hit the nail on the head there. We've lost two years in our experience in social interaction. So, since we've lost those two years, like in a zoom meeting you can mute yourself and turn your camera off and just chew somebody out if they piss you off. Now that we're back in people's faces, we're back in in in real life, that's becoming violence, that's becoming attitude as you pointed out, that's becoming threats of violence whether it even manifests itself with making actual physical contact, and that's assault. 

So, I guess, really quickly, I think the most important thing you can do is make sure that when you hire these new people, make sure that they are trained on how to handle and deescalate these kinds of situations. As we all know, one big, and especially, since we just came off the staffing discussion, one of the easiest ways to lose future staffing, or even lose current employees, is to have an unnecessary act of violence against one of their coworkers. The moment this gets publicized it makes it harder and harder to get new people to replace them.

So, have these discussions with your HR team, find the right training for your staff to deescalate these situations. Again, I hope, I hope that there is absolutely zero need for this kind of preplanning. This is one of the few times I will say, I hope we are completely wrong, but I don't think we are. I would rather you as attraction owners and attraction professionals go through this exercise of asking the questions, how can we protect our staff? How can we train them to deescalate situations so that you don't have to worry about it if it does indeed, continue to get worse. 

Wow, that was a soapbox, but the nice thing is that soapbox is what we're going to end our show on today. 

Philip: The nice thing is it's over.

Scott: And soapbox, I'll step down. Once again, guys, thank you so very much for listening. We hope you get something out of it. I think this was a very information-packed show. I have to give credit where credit is due, you know, I spend a lot of time talking on this show, but Philip is the one who does all of the digging and finds all of the data, and all of the guts of the show. So, he has really worked incredibly hard to make this show great this week, I think, and it gave us an opportunity to talk about things that we feel are really important. So on behalf of Philip Hernandez from Gantom and Lighting and the Haunted Attraction Network and myself, Scott Swenson from Scott Swenson Creative Development, this is Green Tagged Theme park in 30 and we will see you next week.