Monday Mouse Watch : Busting through the berm

Jim Hill

18 years ago

It was the news that sent Disneyana fans everywhere into a twitter last month. The very idea that Mickey was — in the words of Jay Rasulo, Chairman of Walt Disney Parks & Resorts — seriously considering “broadening our footprint” within the continental United States.

Translation: The Walt Disney Company is looking beyond Anaheim & Orlando for possible construction sites of new stand-alone Disney-themed resort hotels, retail, dining & entertainment districts, even water parks.

Mind you, Rasulo (As he was speaking with investors about this possible WDP & R expansion scenario back on February 7th) stressed that …

“These concepts are (just) blue sky ideas right now … They won’t be executed at all if we don’t believe they would generate the returns on invested capital (that the Walt Disney Company has come to) expect to achieve from our businesses.”

Why is Jay sounding so cautious about this rather ambitious idea? It’s simple, folks. Rasulo’s initimately aware of all of the other times that the Mouse has tried to bust through the berm. To do some sort of stand-alone project outside of the theme parks. Only to have those other enterprises close because they either failed to turn a big enough profit or eventually proved to be an operational challenge.

Take — for example — the very first of these stand-alone projects. Which was the Celebrity Sports Center, built back in 1961 in Denver’s fashionable Cherry Creek section. Truth be told, CSC didn’t originally start out as a Disney owned-and-operated establishment. But — rather — this ambitious sports venue was something that Walt himself went in on as a limited partner. Shouldering the cost of construction with several other well-known celebrities of the day like Art Linkletter, Jack Benny and John Payne.

Of course, the main reason that Benny, Disney, Linkletter and Payne pooled their pennies in order to build this enormous sports center right in the middle of Denver (Which featured 80 bowling lanes, an Olympic-sized swimming pool as well as a high-end restaurant) was that they all hoped to make a huge amount of money off of this complex. However, given its somewhat bizarre mix of elements, the CSC was never quite as popular and/or as profitable as the partners had hoped it would be.

What exactly was the problem? Well, based on what several Disney veterans who actually worked at this complex have told me, Denver bowling fans back in the 1960s weren’t all that interested in fine dining. Which meant that — in order to cover its operational costs — the CSC’s restaurant had to rely heavily on the patronage of the swimmers. But then all of those wet bathing suits destroyed the upholstrey in the dining room.

You see what I’m getting at, right? Given all of its operational issues & additional unexpected expenses, the Celebrity Sports Center quickly became a money pit. Which is why Art, Jack & John eventually sold off their shares in CSC to Walt. And as for Walt … Well, he eventually persuaded Roy that Walt Disney Productions should buy the Celebrity Sports Center outright. Making this Colorado-based sports complex a wholly owned subsidiary of the Mouse House.

Of course, one of the main reasons that the Old Mousetro wanted his company to own CSC was that Walt knew that he’d eventually need someplace to train all of the managers who’d work at that new ski area that Disney Productions was planning on building just outside of Sequoia National Forest. And what better way would there be to learn about how to run a brand-new sport complex then by managing the Celebrity Sports Center for a while?

Sadly, neither the Mineral King nor the Independence Lake ski resort projects were ever built. Though Walt Disney Productions did eventually wind up using its Denver property as a training facility. With many of WDW’s original managers getting their first guest service experience in the late 1960s by dealing with all the bowlers & swimmers who frequented CSC.

Unfortunately, even with all of Mickey’s marketing might behind this Denver sports complex, Walt Disney Productions just couldn’t make a go of the Celebrity Sports Center. Oh, sure. The place would be packed on the weekends. And the lanes would do well on most weeknights. But Monday through Friday during the day, the place was basically dead. Which is why the Mouse eventually opted to unload the complex in 1979.

Mind you, this was the very same issue that brought down Club Disney in the late 1990s. Given that this proposed chain of Disney-owned-and-operated children’s play centers would do land-office business on the weekends but then struggle to attract any patrons on weekdays … Well, it just didn’t make sense to move beyond this franchise’s test phase. Which is why all five of the Disney Clubs that had been built were closed down on November 1, 1999.

This is also why Disney Regional Entertainment eventually abandoned its plans to go forward with construction of a worldwide chain of indoor theme theme parks. Given that the Chicago version of DisneyQuest also struggled to draw customers on weekdays, it just made no sense (from a business point of view, anyway) for the company to proceed with this project. Which is why the Mouse pulled the plug on the Philadelphia version of DisneyQuest even after the cellar hole for this 5-story structure had already been dug.

Then there are those mysterious projects like Mickey’s Kitchen (You know? That fast food chain that the Walt Disney Company launched back in April of 1990?) which seemed headed for great success. Only to suddenly get its plug pulled in the Spring of 1992.

For those of you who aren’t familiar with the Mickey’s Kitchen concept, it was actually a pretty ingenious design. This fast food restaurant was built right next door to a pre-existing Disney Store. And — given that the wall that originally separated these two businesses had been torn out — shopping at the Disney Store and then dining at Mickey’s Kitchen (or visa versa) was a pretty seamless / flow-thru experience.

Best of all, because the Imagineers had deliberately designed this shared space to be a split level. So that hose who were eating in the raised dining area in Mickey’s Kitchen could then peer down into the Disney Store next door and have a clear view of all the merchandise that was on sale. Which clearly had an impact on some consumers. Given that gift sales at this retail-restaurant hybrid (Which was build in Montclair, CA) were 20% higher than at other Disney Stores in the area.

Given that Disney executives quickly greenlit construction of a second Mickey’s Kitchen prototype (Which was built right next door to the Disney Store in the Schaumburg, IL. mall), it seems obvious that the company was eager to move forward with this franchise. But then in April of 1992, the Mouse suddenly pulled the plug on the whole operation.

So what happened? Well … There’s always been this rumor that the Burger King executives — who had just signed a seven figure deal with Disney to promote the studio’s upcoming releases as well as a few theme park events through its Kids Club meals — insisted that the Mouse get out of the fast food business. That BK didn’t think it was kosher that Mickey was horning in on its action. Particularly given that Burger King was going to be spending tens of millions of dollars to heavily hype movies like “Beauty & the Beast,” “Aladdin” and “The Lion King.”

The only problem with that explanation is that the dates don’t exacty line up. You see, Disney signed its sponsorship deal with Burger King in August of 1991. But then the Mouse didn’t bail out of the fast food business ’til April of 1992. Given the eight month lagtime between signing with BK and then shutting down MK … I personally think that this particular story is more of an urban legend than an established fact.

Okay. So you’re picking up on the pattern, right? How the Walt Disney Company will first announce an extremely ambitious plan for its latest outside-of-the-berm project … Only to eventually retrench, regroup and/or just cancel the project outright.

I mean, sure. The Disney Vacation Club still operates its satellite resorts at Vero Beach (Which opened back in October of 1995) and Hilton Head (March of 1996). But let’s remember that DVC originally announced that it would be building beyond-the-Disney-theme-park units in Newport Beach, CA., Beaver Brook, CO. and even just off of Times Square in NYC. But all of those projects were eventually cancelled in favor of safer, on-property resorts like the Villas at Wilderness Lodge, the Beach Club Villas, the units at the Saratoga Springs Resort & Spa, even the recently announced Animal Kingdom Villas.

Of course, some of these “Blue Sky” concepts sound like safer bets than others. Take — for example — those stand-alone “Downtown Disney” retail, dining & entertainment districts that the Mouse is allegedly toying with building around the country.

But let’s not forget that — back in the early 1990s — that then-Chairman of Walt Disney Attractions Dick Nunis supposedly put the kibosh on the roll-out of a nationwide chain of Pleasure Islands. Reportedly out of concern about what might happen to the company’s good name if some family eventually wound up being killed by a drunk driver who had earlier been drinking at a Disney-owned nightclub.

So obviously this is trickier than it looks, folks. Given that Jay Rasulo was actually senior vice president for Disney Regional Entertainment as well as general manager of the entire Club Disney chain back in the late 1990s … Well, let’s just say that this guy is very much aware of how truly difficult it is to first get one of these projects off the drawing board, then get it built & keep it open. Which again explains the caution that Rasulo used when describing all of this “Blue Sky” stuff to investors last month.

Though — that said — I am told that Jay does have one project that he’d really like to see make it all the way through to completion. And that involves building a Disney flagship hotel (Something along the lines of the Grand Floridian or the Grand Californian resorts & spas. Which would then be built in a U.S. city that is already a major tourist destination for families) which would have an indoor water park attached to it.

Of course, one hopes that Rasulo can learn from the mistakes that were made at the Celebrity Sports Center back in the 1960s and make sure that all of the upholstrey that’s used in this resort’s restaurants is water-resistant …

Anywho … What do you folks think? Do you like the idea of Disney broadening its footprint in the United States? Building new stand-alone hotels, retail, dining & entertainment districts and/or water parks? Or would you prefer that the company concentrate most of its efforts inside of the berm? Making sure that its pre-existing theme parks and resorts in Anaheim & Orlando are revitalized?

Your thoughts?