Part of our goal here at TPU is to report on themed entertainment from a different perspective than other blogs. Most other attraction websites report on what is going on, mostly dedicated to pictures peeking over construction fences. On occasion, you’ll get to read an interview on who just built the latest restaurant or roller coaster, which is always insightful. Rarely, however, do you hear about why theme parks make the decisions they do. Diehard fans are often dumbfounded as to why a certain attraction is removed, refurbished or even built in the first place. I’ll do my best to tackle these issues as they come, but for today, let’s focus on what Universal Orlando has done right in the last few years.
Oddly enough, Universal, while being a movie studio with plenty of titles under its belt, has found most of their success in Orlando through licensing intellectual properties that aren’t even theirs. “Shrek,” “Terminator 2,” “The Simpsons,” “Men In Black,” “Spiderman,” “Cat and The Hat,” “Popeye” and even “Harry Potter” are all not owned in any way by Universal Pictures. This means that separate deals have been struck with each of the owners/studios which includes a yearly royalty fee in order to show attractions, shows and characters from that IP. More importantly, it also includes a retail agreement so licensed merchandise can be sold by Universal Orlando and the parent company still gets a percentage of that action.
The Wizarding World of Harry Potter at Islands of Adventure is currently the gold standard of the industry in terms of theme park expansions. Sure, Hogsmeade is highly detailed and Harry Potter and the Forbidden Journey’s ride system is a first of its kind. However, it’s the shops and restaurants that have the industry drooling.
Butterbeer may be the most popular theme park non-alcoholic drink of all time. The Harry Potter books and movies created a fictional drink that looked tasty. However, Universal Orlando owns the rights to the name Butterbeer and they now have a drink that nearly everyone who meanders through Hogsmeade must try. At nearly double the cost of a regular soda. It’s ingenious.
More important are those gift shops. Whether she knew it or not, J.K. Rowling was brilliant creating a world so rich that it included unique locations to buy one-of-a-kind items like every flavor beans and magic wands. Those cash registers don’t stop ringing from the time the park opens until well after it closes. And while Universal doesn’t get to keep all the dough (remember, this is a licensing deal with J.K. And Warner Brothers take a hefty chunk out), they clearly benefit from the volume of merchandise and food being sold.
In January 2012, Universal Studios Florida debuted their Superstar Parade. Ever notice that the parade only features two intellectual properties, “Hop” and “Despicable Me,” owned by Universal? The other two, Spongebob and Dora are both licensed. No question, the floats that were designed by Thinkwell are gorgeous. However, notice there is no central theme or even a theme song to tie everything together?
A close source of mine confirmed that this parade was thrown together rather quickly with little thought as to the purpose or story of the Superstar Parade. Why bother having one then? Simply because the top brass at Universal felt there wasn’t enough appeal in the park for kids seven-and-under. The parade typically steps off at 5 p.m. in a park that usually closes around 6 or 7 p.m. in the off-season. Also, the under-seven crowd typically gets up early in the morning. Meaning they arrive in the park early and stay until at least 6 p.m., most likely buying dinner at Universal.
This is exactly why Universal’s Cinematic Spectacular also debuted at the same time in January 2012, giving Universal Studios Florida’s per cap (the average amount a guest spends in a day) a one-two punch. Having a show on the lagoon that has to be shown after dark forces guests to stay in the park even longer and enjoy dinner and presumably buy more merchandise. Otherwise, the Cinematic Spectacular wouldn’t even exist.
On certain days, when park attendance is projected to be fairly light, it’s not even scheduled because not enough people staying after dark would justify the cost of putting on the show. However, once Diagon Alley opens, I seriously doubt we will see very many nights when Cinematic Spectacular is not shown, even during traditionally slow seasons for the park.
Speaking of dinner, did you notice how Universal Orlando’s Citywalk is getting all these new restaurants just before summer and Diagon Alley opens. If I am not mistaken, all of the new eateries will be operated by third-party vendors. Why didn’t Universal open their own restaurants as opposed to allowing new companies to come in and set up shop?
Universal Orlando has recently spent a ton of money on all these new projects from Harry Potter to Transformers to the Superstar Parade and the Cinematic Spectacular. In the case of third-parties opening up, they spend very little money to get those restaurants running. Typically speaking, vendors like Starbucks or Hard Rock pay for the construction and set up of that restaurant – not Universal. The employees at those third-party companies are not employed by Universal Orlando, but rather by the participants themselves.
This means that Universal gives them the space and the vendor builds the restaurant to the specifications that both parties agree on. The vendor, like Starbucks, then pays Universal Orlando not only a rent fee, but a percentage of their total profits as well. Meaning that Universal shoulders very little risk in building a restaurant that flops or the economy takes a dive and they are left operating locations that no longer make a lot of money.
Which brings us back to Diagon Alley. If you’re reading this, I don’t even need to tell you how immensely popular the original Wizarding World of Harry Potter was and still is. Doubling it in another park, forcing guests to buy a multi-day ticket to experience all the wand wielding goodness is a no brainer for anyone. In particular, the train running between each park is unprecedented. It may be the first attraction in the industry (correct me if I am wrong, internet) that will require guests to have a upgraded park hopper ticket just to ride it. This could also be quite possibly be a nightmare for operations employees. However, that’s another story for another time.
Kids, attractions aren’t always roller coasters, lollipops and fiberglass cartoon animals. First and foremost, it’s a business. If you truly want to know why they make the decisions they do, you’ve come to the right place. Next time we will look at FastPass Plus over at Walt Disney World and figure out what they are really up to over there. Meanwhile, take a moment and like our TPU Facebook Page by clicking this link and follow me @TPUJosh on Twitter by clicking here!