"We're that affordable vacation that's close to home, including having a nice meal," says a spokesperson for Cedar Fair Entertainment Co., the Sandusky, Ohio based company that owns such parks as Cedar Point, King's Dominion, and Knott's Berry Farm. "It's a cheaper alternative to a longer trip, so we're happy people are going to stay closer to home. About 75% of our business typically comes from families that live in a 150-mile radius of our parks."
Park owners hope that gains from middle-income families trading down will offset losses from lower-income families who will be too strapped for their annual theme park outings.
"It's a mature industry," says Christian Aaen, principal with Economics Research Associates, which prepared the Themed Entertainment Association/Economics Research Associates' Attraction Attendance Report, "with growth in the low-single digits. The only way to get a bump in attendance is when parks reinvest in major new expansions. But with gas prices up 25% to 30% from last summer, there's going to be an effect. Certainly, regional parks could gain from people making close-to-home to trips. But overall, we'd expect that there will either be very limited growth, or a slight downturn." A lot will depend on how much money consumers feel they have to spend. Parks like Cedar Fair and Six Flags, he says, have been emphasizing value in their marketing plans, whether by adjusting gate prices or promotional pricing. Through June 1, Cedar Fair says, attendance and revenues are "relatively unchanged." But it's definitely a mixed bag: With the exception of its Canada's Wonderland near Toronto, which has been doing big business based on a new thrill ride, attendance and revenues have been soft in the northern region. Attendance at parks in its southern and western regions have been strong, as have season-pass sales. And hotel bookings, though, "are running slightly behind last year at this time."
Last year, which also included a period when consumers were very focused on rising guest costs, there were 122.8 million visits to the top 20 parks in the U.S., a gain of 2.6%. And at waterparks, there were 12.2 million, a 3% gain from 2006.
An exception, Aaen says, are Disney's Orlando parks. In its latest quarterly results, Disney says revenues at its parks and resorts increased 11% to $2.7 billion.
To a degree, he says, Disney is more resilient to economic downturns, although it too has been emphasizing promotional rates and value-added packages. Disney also continues to be popular with international visitors, who are benefiting from the weak dollar. "They can come here and go to the parks and shop," he says. "It's a great value for them."