A Scary Time in the Thrill Business : Entertainment: Theme park attendance is down. But officials predict that the effects of the recession and the war will be mild.
The recession and the Persian Gulf War are taking a toll on attendance at two local amusement parks, Universal Studios Hollywood and Six Flags Magic Mountain in Valencia.
Attendance at Universal Studios in Universal City, which is owned by MCA Inc., fell about 8% during the first few weeks of February, as compared to a year earlier, because of a decline in domestic and foreign tourism, said Universal spokeswoman Joan Bullard. About 80% of the park’s visitors typically come from outside the Los Angeles area.
Bullard said attendance during the first two weeks after the war began Jan. 16 was about even with the same period a year earlier, possibly because tourists had made their travel plans in advance and decided not to cancel at the last minute.
For all of 1990, Universal’s attendance fell to 4.6 million from 5.1 million in 1989, when record attendance levels were generated by the opening of the Earthquake attraction, Bullard said. The studio tour also saw a brief dip in attendance at the end of 1990, she added, because of fears surrounding a fire that destroyed part of the studio back lot in November.
Magic Mountain spokeswoman Bonnie Rabjohn said the park experienced a slight decline--she wouldn’t give precise figures--in attendance during the first two weeks after the war started, as people stayed “riveted to their TV sets.” Unlike Universal Studios, which is open every day, Magic Mountain is open only on weekends and school holidays during the winter. Magic Mountain typically derives about 85% of its business from the local market.
Last year Magic Mountain was the only Southern California theme park that posted an increase in attendance, according to the Nashville, Tenn.-based trade publication Amusement Business Magazine. Rabjohn said Magic Mountain’s 4% rise in attendance in 1990 was due to the opening last April of the Viper roller coaster.
Despite the recent declines in attendance, industry analysts say the damage to Universal Studios and Magic Mountain will likely be mild in comparison to other tourism-related businesses, such as airlines, hotels and resorts.
“It’s a far cry from distress,” said Harrison Price, a Torrance-based attractions industry consultant. Although the start of the war produced an initial shock, Price said that effect is wearing off. “My prognosis is the war is not going to be a big factor as far as attendance goes,” he said.
The impact from the recession will also be limited, said Jim Cammisa, a Miami-based travel industry analyst. That’s because instead of taking longer vacations, many consumers will turn to less costly weekend and day trips that might include a visit to a theme park, he said.
Both Price and Cammisa estimate that theme parks such as Universal and Magic Mountain could suffer a 5% drop in ticket sales this year because of the combined effects of the recession and the war. “But there are other parts of the economy that would love to get away with a 5% drop in revenue,” Price said.
Meanwhile, Universal and Magic Mountain aren’t the only theme parks that are feeling the pinch.
Walt Disney Co. recently reported a 2% decline in earnings for the first quarter that ended Dec. 31 and blamed the drop on fewer tourists and a dip in theme park attendance. Disney won’t divulge attendance figures, but Amusement Business Magazine recently reported that Disneyland’s attendance declined 3% last year.
Last month Disneyland temporarily reduced admission prices for customers from Southern California to $20 for adults and children, the first such price cut in the park’s 35-year history. Disneyland’s regular prices, which return March 3, are $27.50 for adults and $22.50 for children 3 to 11 years old. Knott’s Berry Farm in Buena Park also recently reduced children’s prices and scaled back park hours.
Magic Mountain and Universal say they have no plans to slash admission prices, lay off employees or make any major cutbacks.
But theme parks do tend to shift gears in their advertising and marketing themes during hard times, Cammisa said. Instead of underscoring “luxury and a self-indulgent posture,” he said, they emphasize value or the need to take a break from the stress of everyday life.
In a recent newspaper advertisement for Universal Studios, for instance, readers were offered “a full day of fun” and a free T-shirt, and a Magic Mountain ad promised “the best family values in Southern California” and “a great return on your money.”
Bullard said Universal Studios Hollywood is also banking on some new attractions to generate business. Next month it will debut a $100-million expansion that will include a tribute to Lucille Ball, a “Harry and the Hendersons” sound effects stage, an Alfred Hitchcock attraction and a revamped tram ride. An “E.T.” feature is due to open in June.
Magic Mountain is also hoping for a boost in attendance when a new roller coaster, the $5-million Psyclone, opens in April.
The parks are also pushing hard to keep attendance levels up through promotions and giveaways.
Universal, for example, is offering customers of Lucky supermarkets and members of the American Automobile Assn. discounts on its regular ticket prices of $22.50 for adults and $17 for children under 12.
Magic Mountain is offering $5 off its regular admission prices of $23 for adults and $14 for children less than four feet tall to customers of Target stores and the Certified independent grocery chain. It’s also giving away with the purchase of one admission ticket a coupon good for a free return visit.
Universal’s Bullard said the critical time for theme parks will come later in the year, during the big-business months from mid-spring to early fall. “We’ll be looking very closely at business around the Easter holiday,” she said.