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The (hypothetical) Universal Impact - Merlin's response. Tanks on their lawn, or golden opportunities?

What will/should the response be?


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Universal operates 7 theme parks worldwide. You're comparing an operator's worldwide attendance figures with those of a single UK (much smaller) theme park. That Universal's lower end projected figures, over 7 parks, are 4 times higher than the visitors to Legoland Windsor alone actually shows the strength of Legoland Windsor.

By visitor numbers, as we all know, Merlin Entertainments is the second largest theme park operator in the world.
Ah okay, misinterpreted figures. I thought they were saying each of their parks get between 8m and 12m visitors. Which does sound absurd when you stop and think about it.
It's not your fault, it's the Daily Mail. They fully intended for you to interpret those figures in that way. Sensationalism encourages shares and clicks.
Despite what you say, that Daily Mirror article would seem correct in saying that an individual Universal park could get between 8.4 and 12.4 million guests per year. That stat would not be Universal’s worldwide annual attendance, as each park in Florida alone attracts around 10 million guests per year. The park in Japan also gets 12-14 million guests per year.

The source for this is the TEA Theme Index.

Despite how unbelievable the figures might seem, the Universal and Disney parks really are on another level of visitation compared to the likes of Alton Towers or Legoland Windsor.
 
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In Orlando and Asia.

Just like California.

I think, in the UK, we'll see any hypothetical Universal park operate in a similar way to how they do in California, vs Florida or Asia. There will be a focus for perhaps an overnight stay, certainly initially, but not a multi day break.
Universal has inferred that they intend for quite a few of their guests to come from abroad. If people are coming from abroad, would they really only be coming for a 1 or 2 day visit?

I’m under no illusions that we’ll have a Walt Disney World or Universal Orlando calibre resort in Bedford from day 1; I know that these things don’t work like that. Building a good, successful product takes time, and Disneyland Paris learned the hard way that you shouldn’t be overambitious and build everything for day 1. But I think that my point still stands about Universal operating in a completely different market space to any other UK park.

Whatever Universal ends up building, I think that they will be aiming for that short break market from day 1. At very least, I think a hypothetical Universal park would open with at least one on-site hotel and a CityWalk leisure complex alongside the park itself. Most other Universal resorts in the world have opened with a CityWalk complex from the get go (to the best of my knowledge, it was only the original two in America that didn’t), and this provides a significant amount of non-park entertainment to pad out a stay. I also wouldn’t be wholly surprised if we eventually saw some kind of waterpark offering; Universal offers this in Florida with Volcano Bay, and while a waterpark wouldn’t be outdoors in Britain, I think it shows a precedent for Universal building a ground up waterpark.

As @John_P said, I also think the ticket prices will be in another league. You can bet that Universal certainly won’t be offering 2-for-1s and affordable season passes like Merlin does!
EDIT: Sorry for double posting!
 
I don't think the other UK parks are doomed, but guests who will go to Universal Bedford will see the difference in quality between it and other places in the country

Universal is a premium product and as such places like Thorpe and Towers will still have a greater appeal from a financial perspective. Towers especially is a unique park in how famous and well known its attractions are and scenery. Legoland has its IP, Blackpool is a holiday resort and I think the town will do almost anything to keep Pleasure Beach open as it's so vital to its economy. Paultons and Drayton hopefully will still have Peppa and Thomas etc

I can't really see the Merlin parks especially being too concerned if (hopefully when!) the spades are in the ground at Kempston as it will be at least half a decade before they get any real hits. Maybe a year or two before opening they might, but it strikes me that they would only sort things out after the potential impact

It's a bridge they'll cross once they'll come to it, or at least in close vicinity
 
I just think Universal will operate in an upper echelon with higher ticket prices. If anything in its early years it'll probably be more likely to draw brits away from that two day trip to Disneyland Paris, not that spontaneous trip to Alton Towers.
I think it will be the hotels at the Merlin parks taking the biggest hit when Universal come in.

Why would you pay the extortionate prices to stay at the parks which offer next to nothing in terms of entertainment and awful food when you can get a premium experience at Universal?

Undoubtedly people will continue to visit the parks as a cheap day out but they won't be able to get away with the price gouging that's currently going on at the hotels, especially at Chessie and Legoland.
 
I think it will be the hotels at the Merlin parks taking the biggest hit when Universal come in.

Why would you pay the extortionate prices to stay at the parks which offer next to nothing in terms of entertainment and awful food when you can get a premium experience at Universal?

Undoubtedly people will continue to visit the parks as a cheap day out but they won't be able to get away with the price gouging that's currently going on at the hotels, especially at Chessie and Legoland.
I do think that the short break side of things at the Merlin parks will take more of a hit if and when Universal opens. The short break market is where Universal will be competing, and I think parks like Alton Towers may not look like as much of a compelling proposition for a short break with Universal in town.

This is in large part why I think Alton Towers is the most vulnerable of the UK Merlin parks, as it’s the one that goes for the multi-day short break market most by quite some margin, what with 694 hotel rooms, a waterpark, a crazy golf course and various other things. Chessington and Legoland mostly only have a cursory hotel or two, and Thorpe Park has never really dabbled in this side of things at all, focusing predominantly on day trips.
 
I don't think it's short breaks they need to worry about. It's making their parks appealing and affordable. If a family of 4 could have 2 park days and an overnight stay of reasonable quality at Towers for under £400, you wouldn't get that with Universal.

If you can't afford a short break at Universal, but can afford one at Alton Towers, then that won't change. Some who can afford both, may end up doing both. For me it would be about making the Merlin parks better value for money. The right quality at the right price.

Not to be confused with Merlin's Ryanair strategy of a few years ago with almost free entry whilst the product quality hit new depths. If someone had told me in 2019 that the new entertainment in the ATH atrium was a wet t-shirt competition sponsored The Sun for £30 a ticket I would have believed them. If they'd told me that by 2024 they would be charging £14 for dog poo in a bun and charging you to enter the towers ruins.....wait a minute......
 
Honestly this isn't a zero-sum game, I think Merlin could be in the position to benefit from the addition of Universal GB, if they continue to put decent investment in their parks. California and Florida both have Universal and Legoland parks, as well as other regional parks like Knotts Berry Farm, Busch Gardens and SeaWorld.

If Merlin can get Thorpe and Chessington in the same calibre of those parks within the next ten years then they could also be set to benefit from Universal GB. I don't think this will affect the attendance of Alton Towers that much, but the park will definitely want at least some attractions that at least match the quality you'll see at Universal. As tastes of the British public change in response to the new resort.

Not to mention there's going to be so many Merlin staff that leave for Universal when that opens, the brain drain of quality staff might be the bigger issue if they don't fundamentally address the staffing issues by the time Universal opens. I feel like there's Merlin staff already that'll have their sights at a job in Universal for sure.

But if Merlin fail to invest in their parks as they have done previously, then I feel like Chessington and Thorpe will arguably suffer to a detrimental basis...
 
Apologies in advance, this is a 'long-post warning' - read on at your own peril :)

I think a lot of people are looking at it as if there is one big collective pool of theme park tourists that will just suddenly surge to Universal, leaving all pre-existing parks empty behind them. By that logic, when LegoLand opened in 1996, all other parks like Alton and Chessington etc. would have ceased to exist or struggled as a result. In reality, most tourist attractions of any kind are very regional - for example, growing up we mainly went to Alton, Drayton and American Adventure because they were nearby, whereas trips to Chessington, Thorpe, Blackpool and LegoLand were much rarer because they were further away.

The same will continue to happen when Universal opens, each park will continue to serve a certain region with a percentage of guests from further-afield making a special trip. The only difference is there will another park in the market for people to choose from. Universal's goal is not to go after the very specific, regional tourism markets but to cater to the very large number of tourists (both domestic and international) that come to visit London - which is why they're building it less than an hour away in Bedford.

There are plenty of examples of Disney or Universal moving into a region and it not having an overly detrimental affect on the local theme parks. Parc Asterix is still going strong even after Disneyland Paris was built, as has Fuji-Q in Japan etc. If anything, people were ringing the death knell for almost all European parks when Disney was announced for Paris (even one's here in the UK) and yet Europa Park, Efteling, Phantasialand, Port Aventura and so many more are still going strong.

However, I can see other issues that will cause problems for the UK parks - the first being the perception of quality. I'd argue the standards of parks in the UK is quite far behind most of the rest of the world. Some of the examples I've mentioned above on mainland Europe alone massively outdo the UK's offering in terms of theming, attractions, experience, etc. I don't think any of us could expect anything on the same level of Voltron or any of the other rides at Europa Park here in the UK right now. That's due to years of under-investment and Merlin's monopoly of the theme park/tourism market.

As a result, we have a very low expectation of what theme parks are in this country, believing that a 'quality experience' is saved for big international destinations in Florida or possibly mainland Europe. This however will change when Universal shows up and demonstrates that we too here in little old Britain can have a massive, world-class tourist attraction, the likes of which we've never seen, and, over time, will raise expectations and standards.

I think smaller, family-friendly parks would actually be unaffected because they can cater to local tourists looking for an affordable day out with the kids (much like the Gulliver's parks do now). However, the larger, top parks (mainly Merlin parks) will be held to a higher standard - especially if they are charging park and accommodation prices not too dissimilar to Universal. Whilst it will always have local/regional guests to fall back on, somewhere like Thorpe Park with its somewhat minimal theming and experience (comparatively) will struggle to justify it's price and the journey to get there when you could pay a little bit extra to go Universal with its immersive theming and quality rides, food, shopping, entertainment and accommodation.

The other issue is what effect it will have on the market - will this create a boom in the tourism industry in the London area and/or whole of the UK? Will this open the floodgates to more attractions, midways or even more theme parks moving in to capitalise on the growing market? We've seen what happened when Disney moved into Orlando and what it has done to Anaheim and the wider LA/Southern California area. Suddenly it could become very cramped here, and whilst Universal might not directly compete with a lot of Merlin's parks initially, the influx of other attractions may do so.

So what can the UK parks do? I think it's important for them to establish their USP and give people a reason to come to them instead of going to Universal. Efteling I think do a great job of marketing themselves as a very quintessential, authentic local attraction leveraging the European folklore/fairytale angle and building a very immersive, well-themed experience you won't find anywhere else. I think Alton Towers are best placed to turn themselves into a 'uniquely-British' theme park unlike the massive, global entity that is Universal. I think if AT were to lean into the folklore and history of the place and of the UK at large, I think they could definitely make themselves our equivalency of Efteling. This would only help to improve the park's international draw, especially for enthusiasts who will see Alton as THE theme park to visit in the UK that you wouldn't find anywhere else. Similarly with Blackpool and it's 'very-British, old seaside funfair' vibe.

Unfortunately, I cannot seem this happening for Alton Towers or any of the Merlin parks really as that's just not what Merlin are about. In the nicest possible way, Merlin are leaches - they move into tourist hotspots, setup lots of cheap and cheerful carbon-copy midways like the dungeons or Madame Tussauds and capitalise on all the tourists already in the area. Which is why it will be interesting to see what happens when Universal moves into town as its almost the opposite of what Merlin are used to. Personally though, I don't see Merlin as the types to suddenly 'up their game' and start improving standards massively or investing heavily in bigger, more immersive attractions. They strike me more as the types to 'quite whilst they're ahead' and offload most of their 'unique assets' (such as AT, Thorpe and Chessington) and focus their efforts on their global brands (LegoLand, Madame Tussauds and the Dungeons). Either way, it's going to be very interesting to see what happens in the next 10-15 years.
 
I think it will be the hotels at the Merlin parks taking the biggest hit when Universal come in.

Why would you pay the extortionate prices to stay at the parks which offer next to nothing in terms of entertainment and awful food when you can get a premium experience at Universal?

Undoubtedly people will continue to visit the parks as a cheap day out but they won't be able to get away with the price gouging that's currently going on at the hotels, especially at Chessie and Legoland.
Yeah exactly this. Alton Towers has half heartedly tried to make itself a 'destination resort' with various amounts of effort over the years. You don't build a waterpark if you are not trying to get people to stay there for multiple nights. But then the hotel hasn't really kept up with the offerings from other parks. Places like Parc Asterix and Europa park have multiple, premium hotel offerings and have plans to build more. The one at Alton Towers is very much a product of the 90s. Why stay at Alton Towers for multiple nights if Universal is offering a better product and it much easier to get to. Will be a tricky one for Alton Towers to consider as I imagine building another hotel there would have a lot of planning hurdles to get over, even with a Labour government.

Ditto the other parks. Universal will probably kill a lot of the appeal of staying in the shipping containers at Thorpe Park.

The parks themselves will still be well attended so long as they keep up the capex on a big ride every 4 years or so. I can't imagine that the initial phase at Universal would have more than 2 major coasters and 2 signature dark rides. Even after a decade, Alton Towers and Thorpe Park etc. will probably be competitive in terms of rides. But it will be the overall experience and repeat + international visitors which might start to make Merlin reconsider where they want to place their offerings in the market.
 
I am in agreement with a few posts here, here are my opinions for each park:

Thorpe park: not too affected / increase in visitors: I think it is similar to sea world and I think they will still pull people in for cheap thrills as universal will probably be quite expensive and Thorpe will also probably have more rollercoasters so I think it won't be too affected as Thorpe's market doesn't seem like the market universal goes for, I could also see an increase in visitors as if Thorpe can market itself outside the uk it could work out as a sea world like place where people go to whilst there in the area, I think this can be helped by hyperia since it not only is unique but apparently very visible from heathrow.

Alton: drop in visitors / steady: I could se alton dropping as they pull in a large number of families and have a similar market to universal, and drive time is similar from birmingham so if people only go once every couple of years it could make sence to go to universal instead. on the other hand alton is more thrills focused than universal with more rollercoasters, quite famous outside the uk and cheaper so I could see people staying with alton for the price and rollercoasters and some people going to alton whilst they are in the area similar to busch gardens although it would be quite far out of their way.

Chessington: drop: I think universal are in a similar market with families so I think this could affect chessington it probably won't be a masive drop since people will probably still come due to the price and education value (it is a zoo)

legoland: drop: similar to chessington I think families are the main market univeral go for (they do have more thrilling rides, but a lot of their rides work well with families) whilst they have the ip I think there would be some of the visitors who will go for universal instead, but they will probably have the advantage of price still.
 
This whole topic needs one sentence to answer it.

“Parc Asterix is 56km from Disney Paris”

Until recently (bearing in mind Disney has been in Paris since the early 90’s) Parc Asterix was basically a hybrid of Towers and Thorpe Park.

Honestly Merlin will cope fine with Universal, in extremis it may have to look hard at one of the London Parks. It will certainly make Merlin change their way of working and probably for the better but it won’t kill any of the parks.
 
Chessington: drop: I think universal are in a similar market with families

legoland: drop: similar to chessington I think families are the main market univeral go for

Until you posted this, I had literally never considered that anyone would think Universal was looking to attract a similar audience to either of these parks. Are Universal known for their appeal to the young demographics?

If you look at their Florida parks, I would say that Dreamworks Land and Seuss Landing are probably their most understated areas - they almost feel like Universal phoning it in. Their real focus is on teens and into Generation Z - Harry Potter and Jurassic Park, their big draws, are firmly aimed at these demographics.
 
Until you posted this, I had literally never considered that anyone would think Universal was looking to attract a similar audience to either of these parks. Are Universal known for their appeal to the young demographics?

If you look at their Florida parks, I would say that Dreamworks Land and Seuss Landing are probably their most understated areas - they almost feel like Universal phoning it in. Their real focus is on teens and into Generation Z - Harry Potter and Jurassic Park, their big draws, are firmly aimed at these demographics.
I would have said so, I may be over estimating the age of Chessington / LEGOLAND visitors, but I think that most of universals rides do allow familys, for instance in Florida: minions land (a shooter and a simulator), the world of harry potter and whilst the big rides may not all be suitable Hagrid's is suitable for a lot and the entire area is more or less an attraction with kids running around doing the wand tasks, exploring the shops, the train etc. then you have dream works and zeus landing, and then there is also camp jurassic a large run-around thing men in black, et etc

There are quite a few thrill rides, but I think universal also have quite a few rides that are bellow/arrround 1.1m and they focus on lands to explore and really good scenery with added elements (like the wands in harry potter or the bands in mario) I think the thrill rides could add to the family nature, adding something for older kids whilst allowing the younger ones to enjoy other things

over all, it isnt as family orientated as disney, but I think they still are quite focused on that sector, consider epic univers: nintendo world has the yoshi ride, mario kart, (maybe the donkey kong rollercoaster depending on the height), the entire how to train your dragon land looks good for families, the harry potter streets of paris also looks quite good (and it has a dark ride that could go either way with universal)
 
I think Alton will actually do the best of this tbh. Yes it’s in the middle of nowhere really and difficult to get to sometimes but it’s unique, it arguably has the biggest brand identity out of any UK park and it’s known worldwide amongst communities like this.

Universal are going to be hoping millions are coming in from abroad for their park, Alton is perfectly situated to offer a different experience to any other park. The surroundings, the towers which a lot of people class as a real life castle even though it isn’t.

I think foreign visitors would be tempted by the charm of Alton, Americans especially if they make the trip over, they love quaint English villages which Alton is surrounded by, they love British history because they really don’t have any, not on the same scale. They love the old buildings, castles etc.

The Towers, gardens, surrounding villages are all Alton’s USPs and yes universal are going to way outspend them but they’re not going to be able to replicate that.

I’d go all in on that personally, improve the park offering, improve the food, accommodation, operations and whatever else.

They’ll have a 6/7 year head start to get their ducks in a row, no excuses really. If they can’t pull their finger out (not just towers but Merlin in general) than maybe they deserve to fail.

We’ll see what they do within the first 12 months of Universal getting the green light and spades being in the ground, we’ll see what parks they will and won’t be focusing on. I suspect Alton will be the main one, it’s the Jewel in the Crown.

But if they want to succeed they really, really need to sort out their public transport situation. A constant flow of buses should be departing from Stoke station etc at peak times, every 30 minutes.
 
Alton used to be the jewel in the crown.
It is now more a turd rolled in cheap glitter.
Public transport is not the main issue to sort at the Towers, it has always been poor, it is decades of neglect that is the main factor in the parks future plans.
Universal will make Merlin up their game, but there is clearly room for all, or Universal wouldn't be investing.
 
Alton Towers is still a very unique park even in the European scene. Merlin have time to invest and bring Towers up to standard. I think the hotels will take the biggest hit, the main AT hotel is overdue a refurb and Towers will not be able to compete with shiny new Universal hotels.

Thorpe will be fine as they are targeting the thrill market, I think they will get another major coaster before 2030 and will get the odd new flat ride.

Legoland has the IP behind it and Lego is an evergreen brand. I think it will be ok and still pull the crowds.

Chessington I worry about the most. It's the most poorly operated and many of the rides are getting old and need replacing. The park can't really expand. The waterpark seems a.bit meh but we will have to see how that pans out
 
I really don't like the use of the phrase "competition" much in this debate, but sometimes it's unavoidable as there will be some competitive overlap. It normally instigates very over simplistic debate of some zero-sum game, where you either have to be Universal yourselves, or it's curtains. Then what follows is the "Merlin upping their game" stuff, but not normally in the context that they may need to respond to market changes differently, but to suggest that they need to somehow invest £millions that they don't have chasing Universal for the same market.

This very suggestion is business suicide in every regard. It only has to be a direct head-on "competition" if Merlin make it one, and for the life of me I can't see why any business on earth would burn cash to do that. Merlin currently firmly operate in a part of the market that Universal just won't, The days of hoping that some of their parks, Alton Towers in particular, would ever be world class died pretty much shortly after the millennium. It's been on and off, yet overall degredation ever since. I'm still intrigued as to why Universal are interested in the UK as it puzzles me, but they must see great promise in territory that Merlin don't currently occupy otherwise they wouldn't bother. That in itself should give Merlin some comfort.

It's only the competitive overlap they need to be worried about. Overall, it's a market change that needs to be responded to, it's never been about a head-on competition. The positive change is that it grows the market, much like 3 major coasters opening in Blackpool, Alton, and Drayton all in the same year. They weren't stealing custom from each other, they all benefited. It's about how Merlin capitalise on the Universal effect for me. They do have experience of this already, Legoland Orlando and much of their UK midways are prime examples.

Merlin's UK theme parks already have a distinctiveness about them (some good, some bad). It's about how they harness that and position their pricing. They should welcome Universal actually, as I think it brings opportunities. I think they should position themselves firmly as a good value mid-market operator, that gives you distinct and interesting attractions for a smaller price than Universal will charge. What concerns me however is that they adopted a strategy of being more of a "cheap" no thrills operator in the last decade, and now their parks are in a flux, stuck somewhere between being down-market amusement parks and mid-market theme parks that are currently poor value for money.
 
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