Bob Chapek Leaves a Mixed Legacy at Disney Theme Parks

Bob Chapek
Illustration: VIP+

By now, we’ve all read dozens of pieces about the drama surrounding Disney and how ousted CEO Bob Chapek was viewed as a lackluster leader at the media behemoth. But if there was one bright spot during Chapek’s tenure, it was the massive financial success of Disney’s theme parks business.

Despite the turbulence caused by the COVID-19 pandemic, Chapek eventually brought Disney’s parks back to life before being terminated as CEO. That this was the business where he shined shouldn’t be all that surprising: He used to be head of Disney’s parks biz before taking the top spot at the company. 

Guest spending is referred to as per capita spending, and it quantifies the amount of money a visitor spends at the theme park, including food, merchandise, line-skipping passes and park-provided photos. Sometimes it also includes admission and parking fees in the reported figures.  

As of the last quarter, revenue at the parks was at record levels and attendance was strong even with the slow return of international guests. But perhaps most important, parkgoers were spending more money per visit this year than ever before. 

According to CFO Christine McCarthy, per-capita spending in fiscal Q4 jumped 6% from the same period last year and nearly 40% compared with fiscal 2019. She noted that improved performance reflected the continued popularity of premium offerings, including Genie+ and Lightning Lane.  

Chapek introduced Genie+ and Lightning Lane options in domestic parks in late 2021. Lightning Lane was the rebrand of FastPass, which was previously a free line-skipping pass. Depending on which ride and what day you visit the park, attendees could opt to pay $15 and up to skip the standby line. Genie+ is the platform in which consumers can pay a onetime fee to access limited Lightning Lane advantages instead of paying à la carte for different rides. The move to get attendees to pay for these privileges proved that Disney had strong pricing power. 

Chapek took the helm right before the pandemic hit, and Disney had to close theme park doors. With admission revenue basically halted for months and then severely limited for even longer, Chapek quickly shifted to focusing on growing overall spend at the parks when they reopened, and attendance was limited.  

In addition to his strategy charging for everything including previously free offerings at the park, Chapek also hiked prices of admission tickets multiple times during his less-than-three-year reign. From a financial perspective, Disney parks were thriving and generating free cash flow the company so desperately needed as it was investing heavily into its money-losing streaming business.  

While Chapek was focused on driving profit and monetizing every aspect of the Disney Park experience, he clearly was underappreciating the loyal fans and annual passholders. Even as they provide a source of recurring revenue, the annual passholders typically spend less per visit than occasional visitors and families on vacation. 

In August during the company’s earnings call, Chapek said ticket price increases were offset by an “unfavorable attendance mix” at Disneyland. It was most likely not meant to describe Disney fans, but the fans were offended nonetheless by Chapek’s comments. Some even began taking pictures of themselves at Disneyland wearing T-shirts with the words “unfavorable” and posted them on social media.  

Some could say Chapek had a lot to prove in order to get out from under his predecessor’s shadow. Not to mention, he had to make sure Disney survived the worst pandemic in recent history and, more recently, a deteriorating macroeconomic environment. None of this is to downplay the hurdles Chapek had to jump over.  

However, some have said Chapek’s management style was tactless, and his hunger to drive profit over everything else went against Disney’s nearly 100-year-old ethos, a far different management approach from returning CEO Bob Iger. 

Disney’s recent theme parks success proved to be a double-edged sword for Chapek. While the end result of record profits was certainly worth bragging about, his path to that success just underscored the issues with his management and leadership style at the world’s largest media company.