Knott's cuts Kid's fares to $12.95

Tuesday, January 6, 2004
Theme park makes bold discount move
Knott's Berry Farm pares price for kids to $12.95, lowest gate charge since 1992.

By MICHELE HIMMELBERG
The Orange County Register


Tis the season for price adjustments at theme parks, and this year local families, like the Chavezes in Santa Ana, can benefit from a bold price reduction at Knott's Berry Farm and a two-for-one deal at Disneyland.

After years of regular price increases in the industry, Knott's permanently reduced a child's ticket to $12.95 on Monday. That's the lowest posted gate price for children since 1992, and a huge drop from the 2003 price of $33.

Knott's offers the lowest children's price of any Southern California theme park. The regular adult price remains $43.

The Disneyland Resort will introduce a new version of its Resident's Salute today, offering residents of Southern California and Baja California a $47 pass good for one day at Disneyland and one day at Disney's California Adventure. Normally, adults pay $47 for one park.

Restrictions apply, but Patricia and Mike Chavez are eager to explore the deals. They bought three annual passes to use at Knott's in 2003, and were planning to renew them this year. But their budget got squeezed when Patricia, a student, had to spend several hundred dollars for entrance exams and materials.

"Money got a little tight this year," she said. "But we want to look at it again because my 12-year-old really likes Knott's, and we have a 5-year-old who loves Camp Snoopy."

Theme-park fans can expect another year of aggressive discounting in 2004 as the industry continues to recover from a tourism slump, experts said. The economy is finally creating jobs again, but it's growing slowly and tourists still have some fears about traveling and being in large crowds.

"Discounts give people an incentive to get out there," said James Zoltak, senior editor at Amusement Business, an industry trade magazine. "People sitting at home aren't going to buy any corn dogs."

Zoltak called the Knott's price reduction a "calculated move" to compete with the Disney parks.

"They have to be real nimble and respond to the competitive situation that they are in constantly," he said.

The pricing strategy allows Knott's to hold onto its image as a family destination, attracting young children as well as teens who have been coming for the newer thrill rides. Knott's upgraded Camp Snoopy last year and will open a Lucy's Tugboat attraction there this spring.

"This tells our guests that it's a park for families of all ages, and they don't need coupons to get the child discount," said Susan Tierney, a Knott's spokeswoman.

Disney typically raises its admission prices at this time of year, but officials declined to talk about any proposed price increases.

Spokesman Bob Tucker said the Resident's Salute is geared to loyal visitors in the area. The 2-for-1 offer requires guests to attend the first park on the day of purchase, and the second park in the next 30 days, until April 30. For details, call (714) 781-4565 or see www.disneyland.com.

Admission generates roughly 50 percent of revenues for theme parks, supplemented by parking fees, concessions and merchandise.

"The buzz in the industry right now is that front-gate prices are at or near their peak," said Dave Schmitt, a principal at Management Resources Inc., a Tustin theme- park consulting company. "Every single park, large or small, has to be looking at alternative strategies."

Steady price increases in the past decade have stirred more discussion about alternative pricing, such as a twilight ticket that would cut admission prices later in the day. Another option is pay-as-you-go, a system allowing visitors to pay only for attractions they select.

Theme parks are also turning to some pricing strategies that airlines and hotels use to generate maximum revenues, said Jim Burke, dean of the Collins School of Hospitality Management at Cal Poly Pomona.

"If you're half-full on a Tuesday, you never get to sell that space again," Burke said. "So if you look at discounting as a way to sell space that is going vacant, and if you get even half the revenue you would normally get, you're ahead."

Theme parks adjust by season, rather than by day of the week. Attendance typically falls off after New Year's Day and doesn't pick up again until the spring when children get school vacations. The goal for theme parks is to attract local residents during this slow period with promotions, and maintain - or increase - the regular price.

"The problem is, if you discount too much, people will never be willing to pay full price," Burke said. "They'll always see it as on sale."