Disney is exploring a membership program that could offer discounts and special perks to encourage customers to spend more at Walt Disney World and Disneyland, as well as streaming services, merchandise and more, according to reporting by the Wall Street Journal.
The program would be somewhat akin to Amazon Prime, which offers free shipping, product integration, discounts at Whole Foods, exclusive Prime Day deals, plus a variety of digital media services included in an annual fee. Of course, Disney and Amazon have fundamentally different businesses, so Disney’s offering would likely be materially different.
According to WSJ, executives inside the Walt Disney Company have referred to their initiative as “Disney Prime.” That’s likely an informal or codename for the project. Although everything these days has a “plus” added to the end of it, an official name of Disney Prime would be too similar to the Amazon offering that’s serving as inspiration.
Discussions at Disney are in the early stages, per WSJ. Pretty much everything about “Disney Prime” is unknown at this point. How much the company would charge for membership, how long it would take the company to launch such a program, and what it would entail.
By creating a membership program, the company’s goal would be keeping consumers in the Disney ecosystem longer, which would likely be achieved by offering more value for money. This would in turn get people to spend more on the company’s products and services.
It would also provide Disney with a treasure trove of data, consumer analytics, and other information about their preferences. (Worth noting here that, historically, Disney has a weak track record of putting consumer data to use. As much as it might like to be, Disney is not a tech company.)
According to WSJ, the “Disney Prime” effort is supported by CEO Bob Chapek, who has been vocal internally and publicly about the opportunity for Disney to do more to cross-sell to customers. (This definitely has all of the hallmarks of a Chapek initiative; if there’s anything he truly gets, it’s consumer products and synergies.)
“Technology is giving us new ways to customize and personalize the consumer experience so that we are delivering entertainment, experiences and products that are most relevant to each of our guests,” said Kristina Schake, senior executive vice president and chief communications officer at Disney, in a statement to the Wall Street Journal.
“A membership program is just one of the exciting ideas that is being explored.” Disney already has a special program for superfans, the D23 Official Fan Club. The individual gold tier costs $99.99 per year and comes with access to exclusive events and merchandise. That club also offered members a discounted three-year subscription to Disney+ back at the last D23 Expo, and many fans are expecting something similar in a couple of weeks at the 2022 D23 Expo.
This new “Disney Prime” membership program would be different in that it would be targeted at more casual consumers.
As an early step to better link Disney products and services, Disney is working to enable subscribers to its Disney+ streaming service to buy merchandise associated with some of its shows by scanning a code on the service, people familiar with the plan told the WSJ. The company expects to introduce that feature as soon as this year.
(While the Wall Street Journal positions its piece as a leak or rumor, it’s more than that. Disney cooperated with the article, providing direct quotes and background. To me, this reads as another puff piece for investors or Wall Street, and one that was almost certainly ‘placed’ in the WSJ by the company itself.)
Turning to commentary, I’ll admit to being ‘cautiously curious’ about Disney’s potential loyalty or membership program. We are an Amazon Prime household, purchasing extensively from that online juggernaut while also watching a lot of that streaming service (and various add-on channels), listening to their music, taking advantage of in-store discounts at Whole Foods, and other value-adds that the subscription offers.
I’ve been an Amazon Prime member since May 2009 and have never once thought about cancelling.
Although very different from Amazon Prime, we are both members of various airline and hotel rewards programs. Each of us has had status with Hyatt, Hilton, Marriott, Delta, United, and Southwest at various times in the last decade thanks to a mix of credit cards and usage. Those experiences have been fantastic. We regularly receive upgrades, rewards, and superlative service.
Our experiences with higher end hotels is one of the big reasons why we repeatedly emphasize that Disney is surprisingly bad hotelier. As compared to premium or luxury chained-brand hotels, Disney offers minimal attention to detail and little concern for customer satisfaction. Despite its reputation and price points, Disney is not a great hospitality company.
We also have gone through a number of credit cards that, in their own way, are similar to a loyalty membership program.
Two of our favorite cards are Chase Sapphire Reserve and American Express Platinum. Both offer a wealth of perks and benefits beyond just reward points, including airport lounge access, statement credits, free activities, extended warranties, and exceptional customer support.
All of this is mentioned because any or all of these could provide the blueprint for what “Disney Prime” evolves into. With its vast media footprint, Disney could offer something very similar to Amazon Prime. With its parks & resorts business, Disney could do something similar to hoteliers or airlines. Disney could also roll all of this into a credit card with something above and beyond the current Chase products.
It could be a hybrid of the above, with Disney+ serving as the foundation and other benefits flowing from that streaming service into other facets of the company’s media empire, parks & resorts, and beyond.
Fans of Walt Disney World have long questioned why there was no rewards program.
There were no free nights or room upgrades for loyal guests. About the best thing repeat visitors could hope for was a bounceback offer, and those have been mostly gone for the last couple of years. Beyond that, regulars might find themselves targeted for a timeshare sales pitch, but that’s about it.
I want to be excited about “Disney Prime.” As someone who spends a ridiculous amount each year at Walt Disney World and Disneyland, I’d love for the company to throw me a bone every once in a while–or at least pretend my patronage is valued.
We spend more at Walt Disney World and Disneyland each year than at all other travel companies combined and have nothing to show for it. (Well, aside from the memories…and frequent sunburn…and regrets from the Italy booth. But you know what I mean.) Despite spending less with them, all other hospitality companies are far more gracious and eager for our spending. That makes sense–rewarding loyal customers just makes sense, and is good business.
While I’d love this Disney Prime membership offering to be a bona fide travel loyalty program, I’m highly skeptical.
For one thing, there’s no precedent for Disney actually valuing long-term fans. (Look no further than this week’s other WSJ article for evidence to the contrary.) Right now, Disney wants first-timers and other more favorable guest demographics.
For another, if the company were going to launch a meaningful hospitality loyalty program, they’d do so at a time when hotel occupancy was low and they were eager to regain the trust of alienated fans. Disney’s hotel business is currently performing strongly–there’s simply no need to offer benefits to incentivize more stays. Just like there’s no need to discount to the same extent as in the past.
We’ll give you the same spiel here as we do each time Walt Disney World releases a subpar discount–when Disney offers discounts loyalty rewards, it’s out of necessity, not corporate benevolence. Disney is an extremely savvy business—they maximize profits to the greatest degree economically feasible. Discounts Membership perks will be offered out of necessity, not because the company is your friend and wants to do something nice for you.
With that said, it is possible that there’s prescience here. Perhaps Disney is evaluating the macroeconomic environment, knowing that pent-up demand is fizzling out and a recession might be on the horizon. In such a scenario, Disney might want a path forward after doing so much goodwill and brand damage over the course of the last several years. This would be incredibly savvy–an absolutely masterful move.
I’m also skeptical of this. In recent years, Disney has been much more reactionary than visionary. This isn’t a humble company that’s thinking several steps ahead and preparing for negative potentialities. It’s one with a “no one can touch us” ethos that largely does not believe it has competitors. The attitude towards fans has been that we need them–not the other way around. It’s thus hard to fathom this “Disney Prime” initiative being anything truly beneficial to parks & resorts diehards. At least, not in the near-term.
More likely, this is something that’ll continue down the road of ‘Disney as a service’ with more digital media bundled under the direct-to-consumer umbrella. As someone who doesn’t really consume Disney’s other media products, I’m not really sure what this entails. Maybe comics, books, apps, music, and games? Perhaps they’ll introduce more ‘seamless integration’ between consumer products and the direct-to-consumer businesses?
Whatever it ends up being, I doubt the primary impetus will be rewarding loyal customers or nourishing fans. My guess is that it’ll primarily be about improving corporate synergies, increasing per consumer spending, and reducing friction in the flywheel. (Insert other corporate buzzwords as you see fit.)
Perhaps I’m a pessimist, but in addition to not having the need to incentivize repeat resort guests, I don’t think the contemporary Walt Disney Company has the vision, ambition, or organization to create a membership program even remotely on par with Amazon or any of the other companies mentioned.
Don’t get me wrong–unlike many fans, I don’t think synergy is a dirty word. (To the contrary, it’s something Walt Disney himself laid out back in 1957.) Moreover, when it comes to brand management, creative content, and intellectual property stewardship, Disney is unrivaled. No company can match what Disney does in that regard. They’re more sophisticated on this front than ever, and Disney will probably be the big winner of the streaming war. I just don’t see Disney as a tech or hospitality company, which is probably what it would take for “Disney Prime” to deliver in a meaningful way (for me).
What do you think of this proposed “Disney Prime” membership program? Think the company will actually launch it, or is simply “exploring” the idea as one of many ways to maximize revenue and consumer spending? If it does come to fruition, do you think it’ll actually benefit loyal Walt Disney World and Disneyland fans, or will the main/sole beneficiary be the company? Thoughts on our assessment of the various elements of a potential Disney Prime program? Any questions? We love hearing from readers, so please share any other thoughts or questions you have in the comments below!