Regional Amusement Parks Need to Increase the Fun Factor
Six Flags (SIX) and Cedar Fair (FUN) reported fresh financials Wednesday and Thursday, respectively. The fourth quarter is typically a sleepy season for the two leading amusement park owners. Outside of weekends in October to provide Halloween-themed haunts, most of the regional parks are closed during the period.
However, this still gives us the final piece of the fiscal puzzle that is 2013.
We now know that Cedar Fair and Six Flags grew their revenue by 6 percent and 4 percent, respectively. That's not too shabby, but it's largely the result of higher admissions and a boost in in-park spending. Actual attendance for both chains on a comparable-parks basis clocked in with a mere 2 percent advance. That's certainly better than turnstiles not clicking at all, but it's probably not the kind of magnetism that one would expect in this improving economic climate.
Let's go over a few things that the leading thrill parks can do to make the most of their unique positions.
Parks Should Be More Social
Six Flags and Cedar Fair are no strangers to social media. They have Facebook (FB) pages and Twitter (TWTR) feeds to engage their users. It's free marketing, and can even become cost-effective targeted advertising if they make the most of the sponsorship features of the leading social sites.
However, the industry clearly isn't doing things right. Cedar Fair attracted attendance of 23.5 million last year and Six Flags drew 26.1 million. A lot of them are Web-savvy teens and shutterbug families with the ability to share things virally through their smartphones.
In an age of Foursquare check-ins and Instagram photo-sharing is there really any reason why amusement parks shouldn't be doing better? The ability to share upcoming outings or rave about them in retrospect has never been easier, but the parks could be doing more to encourage those actions by either prodding them more effectively or incentivizing guests to go viral.
Be More Like Disney
It's hard to run a seasonal amusement park like a theme park that's open year round. The attendance levels aren't the same. The prices they pay to get in aren't the same. You'll never see Cedar Fair or Six Flags making the nine-figure investment that Walt Disney (DIS) has made a couple of times in recent years to expand its gated attractions. Then there's the demographics of the park goers. Six Flags and Cedar Fair rely largely on locals, unlike the global tourists that Disney draws in.
However, this hasn't stopped the operators from trying to think like Mickey Mouse. %VIRTUAL-article-sponsoredlinks%Cedar Fair's CEO is a former Disney theme park executive, and the former regime at Six Flags was led by an executive from Disney's ESPN.
Regional chains could learn a lot from Disney, and not just the character meals. From Disney's latest push to allow guests to reserve expedited ride lines before they even arrive at the park to allowing folks to prepay for unlimited in-park and on-ride photos, Disney has a funny way of setting the bar before everybody else.
There will always be capital limitations at the regional coaster parks, but there's something to be said about upgraded food offerings to appeal to more affluent guests and creating fans around everything from pin trading to foodie groups.
It doesn't break the bank to roll out smartphone apps with updated wait times or introduce merchandise that interacts with sections of the park.
So, while regional amusement park operators are doing well, they could be doing so much more.
Motley Fool contributor Rick Munarriz owns shares of Walt Disney. The Motley Fool recommends Walt Disney. The Motley Fool owns shares of Walt Disney.