Star Wars: Galaxy’s Edge wasn’t the immediate hit Disney expected

Six months ago, Disney CEO and chairman Bob Iger said the opening of Star Wars: Galaxy’s Edge wasn’t going to require much marketing muscle.

“I’m thinking that maybe I should just tweet, ‘It’s opening,’ and that will be enough,” Iger said on the company’s earnings call in February. “I think we’re going to end up with incredibly popular and in-demand product with these two new lands.”

Reality has been different.

In the first quarter that Galaxy’s Edge was open at Disneyland Park in Anaheim, overall attendance dropped by 3 percent across the company’s U.S. theme parks, which includes the two in California as well as all of Disney World.

As Iger explained, the 14-acre land may have been the victim of its own hype.

“There was tremendous concern in the marketplace that there was going to be huge crowding when we opened Galaxy’s Edge.” Iger said. “Some people stayed away just because they expected that it would not be a great guest experience.”

Iger named a variety of factors for lower-than-expected attendance, including Disney’s own hikes for ticket prices, many California annual passholders being blacked out for the summer (which the company portrayed as having “managed demand”), local hotels in California raising rates in anticipation of big crowds, and opening the land with only of its two attractions.

Low crowds were reported throughout Disneyland throughout Galaxy’s Edge first weeks of operation, when a reservation was required to gain entry. That ended June 24, and while Disney has a “boarding group” system to manage crowds where guests can reserve an entry time once they’re in the park, it’s only been used for one day.

This fell well short of the enormous hype for land. One source predicted to Orlando Rising in June 2018 that as many as 200,000 people would show up for the opening day. Since Galaxy’s Edge opened, Disney fans have staked out positions at two extremes, with critics claiming the land is already a failure and defenders accusing bloggers and journalists of underselling or even ignoring large crowds.

For Disney’s part, the company remains outwardly confident that Galaxy’s Edge will prove to be a hit in the long term.

“Interest in the attractions and the land is extremely high. We have no concerns whatsoever about them,” Iger said. “We feel great about the product we created. It’s just going to take some time for things to work themselves out in terms of how the marketplace is reacting.”

Attendance was also down at Disney World between April and June, which the company attributes to guests delaying their visits until the Florida version of Galaxy’s Edge opens later this month.

There were plenty of positive signs in the report for Disney parks. Despite the drop in attendance, per capita spending in the park was up 10 percent.

Part of that increase was due to higher ticket prices that Disney says are meant to spread out attendance — a still unproven strategy. While Iger said “we do not feel that we have a pricing issue at our domestic parks,” he noted for the first time on an earnings call that Orlando competitors may be undercutting Disney on ticket prices.

“At the same time that we have taken our prices up, our competition has actually been in the market discounting a little bit more. We’ve certainly seen that with Universal in Florida. And so the gap between what we did and where they’ve been maybe just a little greater than it’s been, and perhaps that’s had an impact,” Iger said.

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