SeaWorld’s DecliningRevenue
It appears that SeaWorld is on its way to staging its comeback after nearly five years of falling revenue and attendance. Its declining revenuecame after it was accused of mistreating orcas as well as their trainers. However, the entertainment company is reportedly staging a sort of comeback by offering new rides and attractions that are unrelated with the orcas it was identified with for several years.
SeaWorld is introducing new prices and attractions unrelated with orcas
Although it may be quite early to tag its recent performance as a comeback, but it doesn’t change the fact that it stands as a sign of hope for the company after its overall attendance in 2017 dropped to the lowest point it had been ever since 2010.
SeaWorld is now under a new management headed by John Reilly who is the interim chief parks operations officer and the CEO. Its focus is now on new deals, attractions, cost cuts and deals. Even though it still displays the whales, it made a decision in 2016 that it would stop breeding and also featuring the whales in different theatrical shows all across its parks. Some of its parks are located in Orlando, San Diego, Texas, Florida and San Antonio.
The company’s turnaround strategy began under the former CEO before Reilly and analysts and investors find the strategyimpressive. Since the year began, the stocks of the company has almost doubled.
Alternative Attractions
Reilly noted that the improvement which thecompany is recording is as a result of better execution of the company’s strategic initiatives and also the visitors’ positive response to the newly introduced attractions.
The interim CEO also added that the company has plans to launch a minimum of one new centre of attraction for virtually all of its park every year. Achieving that requires putting in meticulous plans to reduce downtime and to also market the newly introduced features to the guests. The attractions to be launched include a Sesame Street-themed area at its Orlando-basedSeaWorld facility with six new characters, rides and also a parade. It also has a sea-turtle exhibitcalled the Turtle Reef at its San Antonio-based SeaWorld facility.
A Sesame street-themed area is one of the attractions to be launched
Operation Without Orcas
One obvious change is that the new rides and attractions do not feature orcas. They are also not included in the SeaWorld’s website homepage and it is also difficult to find orcas in any of its marketing materials. A charity group reported that the company has about 21 orcas left at its parks in America.
The 2013 documentary titled “Blackfish” raised a lot of concerns about how SeaWorld treated its orcas and their trainers. That gave it negative publicity and led to an 11% drop in its attendance for about four years.
When the news first broke, the management of the company said the controversy had no adverse effect on its attendance. However, earlier in the year, the company reached a settlement worth $5 million with the SEC over what was referred to by the agency asmisleading and untrue statements about theimpact of the controversy.
The reactions to Blackfish caused the company to have a rethink of its identity and it went ahead to appoint an outsider Joel Manby as its CEO sometime in 2015. It was Manby who decided that the company would cease thebreeding as well as theatrical shows of orca. He also began investing in alternative attractions and rides. The attendance of the company still continued to drop even under Manby’s tenure and he abruptly exited the company earlier this year in February. After occupying the position of CEO for nearly 3 years, Joel Manby reportedly stepped down after the company recorded declines in revenues and attendance under his leadership.
It was after then that Rally got appointed as the interim CEO. Upon an inquiry into whether he is expectant of getting the role permanently, he stated that he is more focused on the delivery of results in the current role.
Effects Of Alternative Attractions
The total attendance of SeaWorld Entertainment from January to September of the year increased from 8.7% from one year earlier to eighteen million visitors. The revenue also surged to $1.09 billion by 9.5%.
A CFRA Research analyst, Tuna Amobi, said the current interim CEO has succeeded in steadying the performance of the company considering a couple of indicators.
Amobi mentioned that he has always been a bit sceptical about the belief of the company that new rides and attractions would help the company deliver turnaround. So it came as a positive surprise to him that the company is moving towards achieving that and how the customers have received the new attractions outperformed his expectation.
The interim CEO stated that the improving revenue and attendance could be partially attributed to a newly introduced season pass plan which allows the customers to pay monthly. Also, the sharp marketing managements and also cuts have contributed to the visible improvement.
