November 30, 2022

What Can Mission-Based Cultural Attractions Learn From IAAPA?

IAAPA Expo 2022

By: Paul Noland, Of Counsel

What might roller coasters, VR experiences, and the latest twists in Dippin’ DotsTM have to do with parks, zoos, aquariums, gardens, and other cultural attractions? Just like theme parks looking for the latest innovations, any visitor-serving attraction should be looking for ways to continually enhance the guest experience, build new revenue sources, and stay relevant in an ever-changing digital world. 

Last month, the global association for the attractions industry, IAAPA, held its annual conference, Expo 2022. The themes heard throughout the conference should resonate within other mission-driven cultural attractions. We’re sharing some key highlights from this exciting week of education, signature events, and of course, the trade show floor.

We’re Back

Due to COVID 19, there was no IAAPA Expo in 2020. Through hard work and perseverance of the IAAPA staff and volunteers, IAAPA Expo did take place in 2021. It was a much smaller and more sober event than normal, but industry players were happy to get together in person once again. It felt like the unspoken theme was “We’re Still Here.”

IAAPA Expo 2022 had a very different vibe. With 37,000 attendees (up 31% vs 2021) from 104 countries and 1,077 exhibiting companies (up 23% from 2021), this year’s theme felt more like: “We’re Back.”  The over 100 education sessions were very full, the trade show floor was packed, and the exhibitor booths were busy all week. 

Hal McEvoy, IAAPA’s CEO, summed it up well by stating, “It has been wonderful to see the continued recovery of the global attractions industry. I’m proud of our team, partners, and volunteers for executing a great show in Orlando that benefits our members and our community.”

2022—Attendance and Revenue Continued to Grow

Much of the conversation around the Expo was centered on the surprising success of the 2022 season.  Most park owners reported steady attendance gains versus 2021. In many cases, attendance has now returned to 2019 level or even beyond.

The most surprising area has been per caps. Per caps are up significantly, driven by three factors:

  • Increased pricing on admissions, F&B, and merchandise
  • Reduction in unproductive discount programs
  • Guests purchasing more while in parks including upgrades and premium experiences

These results come against a backdrop of significant inflation, higher interest rates, and large reductions in individuals’ investment accounts. Clearly, people are happy to “get out” again and are making sure their visits are memorable.

Certainly, these results were not universal. Pockets of the world—the United Kingdom, and parts of Asia, for example—are still struggling to recover to pre-pandemic levels.

Inflation Impacts the Attractions Industry

While the overall feelings were very positive, the industry is facing some headwinds. 

Industry suppliers, from ride and game manufacturers to food vendors to technology suppliers, are all dealing with increased costs for labor and raw materials. This has resulted in a bit of “sticker shock” for attractions looking for new rides and other additions for their parks. Anecdotally, price increases ranging from 10-50% were reported (vs. pre-COVID). 

In addition to costs for large capital purchases, attraction operators are struggling with increased costs for almost everything, with labor expense leading the way. The importance of controlling labor costs given both the expense and availability issues was observed in some of the products featured by exhibitors.

Bob’s Space Racers, a Florida-based arcade and midway games maker, featured a new line of games at the Expo that were “attendant-free.” These games can be operated without an operator present.

Technology companies, ranging from ticketing to labor management software providers, were emphasizing the labor reduction and labor efficiency aspects of their solutions. SATISFI, an AI chat company, offers customer conversation management software fueled by artificial intelligence that speeds answers to customer questions and is more efficient from a labor standpoint. While not a new concept, solutions like this are becoming more widely used given labor issues.

Headwinds Ahead

While the overwhelming sentiment expressed by attendees was positive, there is considerable focus on 2023 and beyond given some concerns:

  • While guest spending has been higher than expected, the longer-term impact of high inflation may result in reduced spending in the future, especially if people are draining their savings and/or increasing their credit card debt. In that case, it will force consumers to “reign in” their spending in the future
  • Despite a slowing economy, labor shortages may continue to impact the guest experience and labor rates show no sign of moderating
  • Costs may continue to increase for both expense and capital items

Final Thoughts

IAAPA Expo is such a large-scale event that it’s hard to provide a summary—there are just so many different pieces. The most amazing aspect, in this author’s mind, is the willingness of IAAPA members to share information with each other. It’s networking, but on a different level. I’m always amazed to see park operators sharing the secrets to their success with complete strangers. It’s part of what makes the attractions industry unique, and that willingness to share helped get many parks through the pandemic.

The recovery of the industry in 2022 is a testament to how much people enjoy being together in a special environment.

While there are some troubling signs on the horizon, the industry will do what it always does—deal with it and move on!

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