The Walt Disney Company: Theme ParksAt the end of the day, our product is not the castle or the teacups or the physical things we build. Our product is the guest experience. Thats what keeps people coming back. Tom Staggs$1$Tom Staggs, Chairman of Walt Disney Parks and Resorts, was scrolling through the days news in August $2010$ when an Orlando Sentinel headline caught his attention: Harry Potter and Forbidden Journey ride passes million$-$passenger mark$\mathrm{.}2$ The Wizarding World of Harry Potter had opened at Disneys rival, Universal Studios Orlando, barely three months earlier, but was already a blockbuster success for Universal and its new parent company, Comcast. Universal Studios Orlando had always lagged far behind Disney in attendance and revenue. In $2009,$ Universal drew roughly $5$ million visitors to its top Orlando park, a fraction of the $17$ million visitors to Disneys Magic Kingdom$\mathrm{.}3$ Disneys eight theme parks across the globe consistently ranked as the worlds most heavily visited themed attractions and domestic attendance had seen over twenty five percent growth in the prior eight years.Publicly, Disney executives took the position that a rising tide of visitors to Orlando would raise all ships. We welcome Harry Potter to Central Florida, Michael Griffin, a Disney vice president, told the New York Times, because experience has shown us that any new offering in this market helps draw additional visitors to our resort. But reports of swarming crowds, shrieking fans, and hours$-$long lines signified that Potter mania was taking hold. In its first six months, Wizarding World would attract $20\%$ more visitors to Universal than in the entire previous year. Revenue skyrocketed by $41\%,$ led by higher ticket prices and Potter$-$themed merchandise.Pressure was mounting for Staggs to drive growth in the Parks business$\mathrm{.}6$ Just a year earlier, Walt Disney Companys CEO, Bob Iger, had shifted Staggs from the position of CFO to that of Chairman of Parks, while simultaneously moving then$-$Chairman of Parks Jay Rasulo into Staggs former job as CFO. The swap was widely viewed as a test to determine which executive was better equipped to succeed Iger, whose contract would expire in $2018\mathrm{.}7$ Staggs knew that his advancement hinged on the daunting task of growing the segments $$11$ billion in revenue which already represented nearly $30\%$ of total company revenue $($see Exhibit $3).$ Throughout the global recession, the company remained deeply committed to expansion of the Parks assets, consistently investing roughly $$1$ billion per yearin the segment$\mathrm{.}8$ It was now up to Staggs to decide how to strategically deploy this capital over the next several years.In addition to conventional expansion and renovation projects, Staggs team proposed several competing out$-$of$-$the$-$box creative concepts. First, a technological overhaul of the Walt Disney World resort promised to bring Disney vacationing into the digital era. Second, a stand$-$alone hotel in Hawaii would be an opportunity to test demand for Disneys signature hospitality experience without the theme$-$park infrastructure. Finally, several members of the team remained intrigued by the divisions attempt to launch and scale DisneyQuest, a small$-$scale themed indoor arcade that was intended to provide an indoor immersive experience in cities spread across the US and around the world.Staggs was convinced that the company needed to innovate radically to attract the next generation of Disney vacationers while taking pains to protect the core experience. Were there other options? Which ideas held the most promise for creating long$-$term value? The time for a decision had arrived.Walt Disney and a New Type of Amusement ParkWalt Disney began tinkering with the notion of theme parks in the $1940$s$,$ twenty years after founding his iconic movie studio. At first, almost obsessively, Walt used miniature figurines to create micro$-$scale scenes of American life, complete with backgrounds painted by a studio artist$\mathrm{.}9$ He also experimented with mechanical human$-$like figures, precursors of the audio$-$animatronic robots that later became signature features of the parks. Walt originally wanted to take his dioramas on the road; he dubbed the project Disneylandia and described it as visual juke boxes with the record$-$playing mechanism being replaced by a miniature stage setting$\mathrm{.}10$ The idea of a traveling miniature show gradually morphed into a train$-$ride concept: a full$-$size train would carry visitors through his movie studio to arrive at a small$-$scale landscaped village scene$\mathrm{.}11$ What had begun as a static diorama concept thus evolved over time, inching closer and closer to a dynamic real$-$world immersive experience.Disneylandia often took a back seat to studio issues that required Walts attention. But after a transformative visit to Tivoli Gardens in Copenhagen in $1951,$ he returned to Burbank more dedicated than ever to his wild idea $($see Exhibit $4)\mathrm{.}12$ As a parent, he observed that he always ended up sitting on the bench as $($the kids$)$ rode the merry$-$go$-$round and had all the fun. $13$ Disney believed there should be a park where the entire family could engage together and have a good time. Every time you had a meeting with Walt on something else, why, the Park would come up$.$ Especially if you were up in his office, where he had all his drawings and stuff, recalled one animator$\mathrm{.}14$ When Walt initially described the concept to executives at the TV network ABC $($which would later invest in Disneyland$),$ they later admitted that our people seemed not to understand what he was talking about$\mathrm{.}15$ Undeterred by such skepticism on the part of his wife, his brother, business partners, and investors, Walt forged ahead full$-$steam. Abandoning his initial intention to locate the railroad and park at the Burbank studio, he instead purchased an $160-$acre parcel in Anaheim$\mathrm{.}16$In $1952,$ Walt formed WED Enterprises $($using his initials$),$ a spin$-$out of the studio that would focus solely on development of the park concept$\mathrm{.}17$ The WED team consisted of former animators and movie producers who knew nothing about building theme parks but everything about compelling and imaginative storytelling. Walt filled in the gaps in the teams capabilities by hiring architects and engineers. The WED team, later known as the Imagineers, guided the creative evolution of the theme parks for decades to come. To figure out how guests would experience their new park, Walt and his Imagineers visited other family$-$entertainment centers, such as Knotts Berry Farm, aiming to measure the width of the walkways, the traffic flow, and study how people moved about$\mathrm{.}18$ After four years of frenzied planning, design and construction, Disneyland opened its doors to the public on July $17,1955.$ Though opening day was a notorious logistical fiasco, the park eventually claimed a place in American culture as the happiest place on earth.Disneylands Opening Day: The Birth of a New Business ModelThough visiting California was out of the question for most Americans in $1955,$ the Disneyland concept immediately gripped the country: $70$ million households tuned into ABCs live broadcast of opening day$\mathrm{.}20$ There had never been anything like it$.$ The park was laid out in a hub$-$and$-$spoke design; arriving guests entered a thoroughfare dubbed Main Street U$.$S$.$A$.,$ which ultimately led to the Sleeping Beauty Castle. Main Street recalled Walts childhood hometown of Marceline, MO$,$ setting a tone of nostalgia and idealization of a bygone era. From this central hub, guests could explore four themed lands: Adventureland, Frontierland, Fantasyland, and Tomorrowland. Some attractions were based on Disneys films, but many invoked classic fairytales or embodied newly imagined intellectual property. Marty Sklar, a celebrated Imagineer, described the design as the road map of Walt Disneys life$\mathrm{.}21$Walt and his Imagineers shielded Disneyland from the real world via strict control of aesthetics and operations. Physically, the park was walled off by an elevated ridge or berm that created visual distance between its utopian attractions and their actual surroundings$\mathrm{.}22$ Inside Disneyland, guests could only see what the Imagineers fabricated for them to see. The scale of the park also set a distinct tone. Walt was said to have insisted that the height of the attractions feel welcoming; he derided how tyrants in the past built these huge buildings And they towered over the people just to impress the people$\mathrm{.}23$Sleeping Beauty Castle was designed to be a visual magnet to lure guests down Main Street, not to intimidate them$\mathrm{.}24$ Equally firmly controlled was the parks version of hospitality, internally called the Disney way. All employees underwent rigorous training, known as Disney University, that dictated everything from demeanor to facial hair; such training persists at the company today $($see Exhibit $5)\mathrm{.}25$ Van Arsdale France, the original head of Disney University, explained: We dont hire for jobs here so much as we cast for parts, especially the onstage rolesticket takers, ride operators, tour guides. You cant go on stage unless you are set to give a pleasant, happy performance$\mathrm{.}26$ Fittingly, park employees are referred to as cast members.Just three months after opening day, Disneyland welcomed its millionth visitor$\mathrm{.}27$ The park proved to be a financial success as well as a cultural phenomenon, generating $$24\mathrm{.}5$ million in revenues in $1955\mathrm{.}28$ Guests paid a nominal entry fee and then purchased books of tickets for rides. Plentiful A$-$ tickets were for simple rides; rarer E$-$tickets provided admission to exciting attractions like Pirates of the Caribbean.The banks that had once considered the Disneyland idea outlandish were now willing to lend at a rate of $3\mathrm{.}75\%,$ far below the interest charged on loans for filmmaking, to create more parks$\mathrm{.}29$ A new business model was born. Cities as dissimilar as St$.$ Louis, MO$,$ and Brasilia, the capital of Brazil, clamored for a second Disneyland. In $1963$ Walt convened a team of his most trusted executives to lead Project X$,$ which culminated in the purchase of $27,400$ acres of land for just over $$5$ million in Orlando, FL$\mathrm{.}30$ This second Disneylands name, Disney World, embodied the companys ambition for the new resort. When Walt died in $1966,$ his brother Roy and the Imagineers team forged ahead with the Magic Kingdom, which opened to the public in $1971.$The Eisner Years: Monetizing the ParksFor nearly two decades after Walts death, the company stagnated, hobbled by infighting among Walts nephew Roy $($his fathers namesake$),$ Walts son$-$in$-$law Ron Miller, and two members of Walts original team, Card Walker and Don Tatum$\mathrm{.}31$ The $1982$ opening of Walt Disney Worlds second park, EPCOT $($which bore virtually no resemblance to Walts original concept$),$ did little to boost Wall Streets confidence$\mathrm{.}32$ By $1984,$ the stock price had tumbled to $$50$ from a high of $$123$ in $1973\mathrm{.}33$ To ward off a hostile takeover and pacify Wall Street, Michael Eisner, then president of Paramount Studios, was named CEO in $1984\mathrm{.}34$Eisners status as a Disney outsider would turn out to be crucial; he was unencumbered by Walts legacy. The two original Disney executives were legendary for their devotion to what Walt wanted. For example, when pressed to increase the price of parking at Disneyland from a laughable $$1$ per car, Walker protested: The parking lot is the first thing the guest sees. Walt wanted them to think that this is the greatest place on earth. We have to keep our prices low so that guests feel theyve gotten a good value$\mathrm{.}35$ Eisner was unconvinced that the value of a Disney vacation depended on low prices. On the contrary, he believed that the company had vastly underestimated visitors willingness to pay for a Disney experience$\mathrm{.}36$ This insight would revolutionize the parks. In $1984,$ Disney theme parks generated just over $$1$ billion in revenue$\mathrm{.}37$ In $2005,$ the year of Eisners departure, the segment brought in $$9$ billion$\mathrm{.}38$Initially Eisner implemented slow$-$but$-$steady increases in admission prices, which had recently shifted from a ticket$-$per$-$ride model to an all$-$access entry pass. The new model encouraged guests to spend more time at the park on each day of their visit in order to wring the most value out of the pass, and thus to make more ancillary purchases of concessions and souvenirs. With nearly $30$ million visitors per year, a mere $$1$ increase in the admission price would translate into an additional $$30$ million in operating profit. $39$ By increasing ticket pricing in increments no greater than $10\%$ over four years, Eisner improved operating profit by $$310$ million while initially avoiding the attention of the press $($see Exhibit $6)\mathrm{.}40$ By $2010,$ a four day trip for a family of four to Walt Disney World was likely tocost over two thousand dollars. $($see Exhibit $7$ for a cost breakdown$).$Eisners longer$-$term vision was to transform a theme park visit into an end$-$to$-$end vacation experience. In $1990$ he unveiled a sweeping plan for $29$ new projects that targeted $20\%$ growth per year and a $20\%$ return on equity$\mathrm{.}41$ The next $10$ years, we're going to do nothing less than re$-$invent the Disney theme park and resort experience, and not just here in Florida, but in all our parks and resorts, Eisner declared$\mathrm{.}42$ This so$-$called Disney decade would entail the opening of seven new parks $($including international expansion to Paris and Hong Kong$),$ nearly a dozen hotels, fine$-$dining restaurants, an Orlando shopping center, a timeshare offering, a cruise linethe list went on$.$ The anticipated scope and pace of execution was staggering.Diversifying the Disney Audience: Appealing to AdultsDue to an aging population and age compression within the United States, Eisner wasnt just enlarging the parks geographic reach; he also envisioned expanding their target audience $($see Exhibit $8$ for data on demographic trends$).$ Many of the rides inaugurated during this period skewed much older than Walts original attractions. The $199-$foot Tower of Terror, for example, dropped guests vertically $13$ stories to give them the sensation of free fall. Mission Space, a giant centrifuge, simulated the G$-$forces of a spacecrafts launch and re$-$entry; the ride was so intense that it was later modified to offer a slower green option. Eisner also broke the mold by looking outside the Disney universe for content; by leveraging hit movies like Star Wars and Indiana Jones, he made the parks more appealing to the male demographic.Disney also looked to large conventions as an important source of profit at its theme parks. Conventions helped to offset the natural seasonality that occurs as a result of the school year. By the end of $2005,$ Disney owned and operated over $300,000$ square feet of conference space and hosted some of the largest conventions in the world$\mathrm{.}43$ As conventions became a more important component of the theme parks, Disney increased the number of entertainment options available to attendees. For instance, conference attendees factored into the design of Disneys Boardwalk Resort, which included a dueling piano bar called Jelly Rolls, several upscale restaurants and an ESPN$-$themed restaurant called ESPN Club. Richard Clover, Senior Vice President at ESPN, explained, The appeal of $[$Disneys Boardwalk$]$ for us clearly includes convention attendees, which tend to be our core audience of adult males$\mathrm{.}44$ Disney also attracted a number of top chefs to improve the appeal of their restaurants to an older and more sophisticated crowd.While many conference attendees valued the Walt Disney World location because of its numerous, high quality hotels and superior entertainment options, others felt it was a weird amalgamation of work and play. For instance, conference attendee Jim Hanks complained that while having an important breakfast meeting at the resort, Pluto playfully placed his hands over his eyes. According to Hanks, All of a sudden I felt a pair of hands covering my eyes. I was really angry$\mathrm{.}45$The most extreme example of Eisners pivot toward adults was Pleasure Island, a set of six high$-$ priced thematic entertainment venues limited to adults and located in the Downtown Disney shopping district. The most over$-$the$-$top was the Adventurers Club, a comedy venue in the style of a hunting lodge where animatronic explorers warmed up the crowd. The BET Soundstage attracted hip$-$hop enthusiasts; $8$Trax blasted music from the $1970$s and featured the worlds largest rotating dance floor$\mathrm{.}46$ Every night of the year, all six venues held a New Years countdown culminating in a massive midnight celebration. Pleasure Island proved to be a financial success, attracting both vacationers and locals$\mathrm{.}47$In $2001,$ the New York Times sent a $30-$year$-$old single reporter to review Walt Disney World, a clear sign that the demographics of Disney guests had evolved. As a $30-$year$-$old man in a constant battle for personal coolness, the reporter wrote, the concept of going to Disney World had always had roughly the same appeal as donning a Day$-$Glo tuxedo or celebrating my birthday with my mom. But, he continued, What I discovered surprised me: not only was I not aloneparts of the park are actually teeming with single peoplebut the park itself was awash in some distinctly grown$-$up activities. Indeed, in the three days I visited in Februaryduring the park's Mardi Gras celebrationI found all sorts of behavior that might have made Walt wilt$\mathrm{.}48$ A trip to Walt Disney World was no longer just a getaway best suited to mom, dad and the kids. It was also for those seeking high$-$speed thrills. It was for the busy conventioneer looking to network in a work$-$friendly atmosphere. It was for the young$-$ adult couple who wanted to experience a romantic dinner at a celebrated restaurant and the countdown at Pleasure Island. It was for anyone looking to escape.Adding Income Streams: Beyond the Theme Parks GatesEisner also multiplied the segments income streams by investing outside the theme$-$park wheelhouse and exploring new ways to deliver an immersive experience. One prime example was the Disney Cruise Line, launched in $1996,$ which has expanded to four ships; an additional three are planned for $2023\mathrm{.}49$ Though competitors like Royal Caribbean and Carnival Cruise Line already featured child$-$friendly spaces and even character$-$based themes, the Imagineers designed their ships from scratch to thoroughly transport the guests to a fantasyland. Mickey Mouse motifs and costumed characters aboundedbut there were far less predictable components. Waiters were assigned to serve a particular family throughout their vacation, creating a bond between the staff and the vacationers. Broadway$-$quality theaters boasted stage shows like Beauty and the Beast. Disney even bought its own island in the Bahamas, where many of its cruise itineraries stopped. Castaway Cay was designed by the Imagineers as a contained tropical paradise, complete with a fabricated shipwreck $($see Exhibit $9).$ The astounding success of the cruise line would later serve as a proof$-$point for Staggs that Disney could create compelling immersive experiences without a single ride.Other projects that extended beyond the theme parks were unsuccessful. The Disney Institute, for example, was a sprawling campus adjacent to the Orlando parks, intended to provide vacationers with fun and instruction on topics ranging from business to cooking to topiary gardening$\mathrm{.}50$ Prices varied$$600$ to $$2,000$ per class, excluding room and board, for stays of three to seven nights. Uptake was tepid. The company indefinitely extended its introductory price of $$49$ per class and rolled out shorter one$-$ and two$-$night packages. The campus was closed in $2002.$ Today the Institute specializes in professional development and training, with a focus on leadership and customer service; classes are held at Disney hotels. According to a company blog, We always offered business programs in addition to the leisure classes. It took us some time, though, to realize that the business programs are our sweet spot$\mathrm{.}51$Another promising but challenged concept was DisneyQuest, a small$-$scale themed indoor arcade where visitors could design their own attractions$\mathrm{.}52$ The company opened $100,000-$square$-$foot venues first in Orlando and then in Chicago, to provide guests an indoor immersive experience targeted largely at teens. There were plans to expand DisneyQuest to up to thirty more cities throughout the country and world$\mathrm{.}53$ DisneyQuest was viewed as an opportunity to reach customers who didnt frequent the parks $($see Exhibit $10$ for household income segments$).$ The idea was initially popular; one customer described it favorably as an indoor ultimate Chuck E$.$ Cheese$\mathrm{.}54$ Over time, however, complaints about long lines and high prices increased. Disney eventually lowered the Chicago admission price from $$34$ to $$26,$ a fraction of the price of admission to Disney World$\mathrm{.}55$ As time passed without technological updates, the VR experience began to seem primitive. The Chicago venue closed within a few years. However, some wondered whether the strategy still had merit. DisneyQuest was not a bad conceptIt might have legitimately become a mainstay of American cities and a local connection to Disney Parks, commented one journalist$\mathrm{.}56$ Could a different execution have more susccessfully brought the magic of Disney closer to home?The Iger Years: Reigniting CreativityMichael Eisners tenure ended in a scenario nearly as tumultuous as the one he had entered $21$ years before. Though the successes of many of his domestic projects were undeniable, the financial woes of Disneyland Paris plagued the company. Also, the creative core of the company was beginning to suffer under Eisners hyper$-$cost$-$focused regime, and infighting among Eisner, Roy Disney, and company executives had reached a breaking point. As the New York Times reported, shareholders essentially revolted against Eisner, forcing the departure in $200557$ of a CEO who would be remembered as both brilliant and controversial$\mathrm{.}58$ Then$-$President Robert $($Bob$)$ Iger took on the CEO position and a set of difficult challenges: to refocus the companys strategy, continue to deliver the rapid growth that Wall Street had come to expect, and refresh the creative minds at Animation and Imagineering, whose ranks had been reduced to control project costs.Igers managerial style was a stark contrast to Eisners domineering approach; he was known as a hard worker with an easy charm and cool demeanor$\mathrm{.}59$ Out of the gate, Igers acquisition of Pixar fueled a creative renaissance at Disney. His first Head of Parks, Jay Rasulo, also delivered a major win when he finally won approval from Chinas central government to build a Disney park in Shanghai$\mathrm{.}60$ After four years of early success sharpening the companys strategy and steadily growing the share price, the global financial crisis put a damper on consumer travel and discretionary spending. It was in this difficult climate that Staggs was named to the position of Head of Parks. Disney cut prices, but largely maintained steady attendance throughout the recession$\mathrm{.}61$ Staggs and Iger were both highly optimistic about the long term potential of the theme$-$parks business. It was up to Staggs to determine where growth would come from next.Staggs as Head of Parks: Refocusing the Core BusinessFor starters, Staggs and his team sought to reaffirm Disneys mastery of immersive attractions and to counter the frenzy surrounding The Wizarding World of Harry Potter. The next project had to be bigger and better than anything that Universal could deliver. Borrowing from the Eisner playbook, Staggs and his team looked beyond Disneys intellectual property for characters compelling to the Potter set. Eventually Staggs announced that the company would build Pandora, a new immersive land near Orlando featuring two technologically groundbreaking attractions based on Avatar, the $2009$ box$-$office blockbuster$\mathrm{.}62$Meanwhile, in a pivot away from the Eisner era, Staggs reoriented the company toward families, its core demographic. He directed the Imagineers to completely overhaul Downtown Disney and permanently closed Pleasure Island. The new retail complex, dubbed Disney Springs, leased space to designer retailers like Kate Spade and Kiehls and high$-$end restaurant venues such as Morimoto Asia and Ghirardelli. Our fundamental goal is to create a welcoming, comfortable space where families can enjoy time together and instantaneously feel right at home, Staggs explained$\mathrm{.}63$Staggs as Head of Parks: Searching for the Next Blockbuster ProjectAlongside these upgrades to the core experience, Staggs knew that his team had to look for new opportunities for expansion. It would take a game$-$changing project to produce significant growth; the segment already brought in $$10\mathrm{.}6$ billion in revenue and $$1\mathrm{.}4$ billion in operating income in FY$09.$ Also, Iger had hinted that he would soon be promoting an as$-$yet$-$unchosen member of the executive team to a new COO position$\mathrm{.}64$ An innovative signature project would make Staggs a prime candidate for the promotion. When Staggs team presented him with options, he began contemplating what he would recommend to the board.Digital OverhaulDisney executives were increasingly preoccupied with using technology to enhance guests vacation experience and streamline theme$-$park operations. Two of the most influential consumer$-$ technology thinkers, Steve Jobs of Apple and Sheryl Sandberg of Facebook, sat on the companys board, and Jobs was known to be a close personal confidant of Iger$\mathrm{.}65$ In $2008$ the president of Walt Disney World, Meg Crofton, challenged her team to rethink how Disney vacations work. We were looking for pain points, she told Wired magazine. What are the barriers to getting into the experience faster?$66$ For several years, her executive team had been fixated on improving declining metrics, including deteriorating intent to return. Guests cited long lines, high ticket costs, and the overall complexity of the experience as key reasons for dissatisfaction$\mathrm{.}67$ A staggering $810,000$ guests on average passed through the parks main entrance every hour$\mathrm{.}68$The handpicked team of Disney veterans and Imagineers whom Crofton convened to brainstorm came back with a drawing of the Magic Kingdom without turnstiles, she later recalled$\mathrm{.}69$ Over time, this vision took the form of an RFID$-$enabled adjustable plastic bracelet, or magic band, that would be sent to guests prior to their vacation. The prototyped wristbands were colorful and personalized with the guests name, making them fun to wear as well as functional $($see Exhibit $11).$ As soon as guests arrived at the resort, they could use their bands to key into their rooms, pay for food, and skip lines for rides they had reserved in advance. The wristband would allow guests to immerse themselves in their Disney vacation, without cell phones and credit cards to interfere with the illusion. Meanwhile, behind the scenes, an all$-$inclusive new digital infrastructure would integrate Walt Disney Worlds four theme parks, $140$ attractions, $300$ dining locations, and $36$ hotels$\mathrm{.}70$The promise of making Disney vacations more efficient and stress$-$free was exciting. But at an estimated pricetag of $$1$ billion, this would be an unprecedented investment in experience enhancement$\mathrm{.}71$ Supporters of the project argued that the magic bands would be much more than a fix for customers frustrated by long lines; they would drive incremental profit. For instance, visitors would have the option of charging meals and merchandise to their bands, increasing the ease and speed of in$-$ park purchasing. And by enabling guests to reserve ride times in advance, they could reduce congestion and increase through$-$put at top attractions. But perhaps the bands greatest benefit lay in the data they would capture. At a micro level, park operators could personalize guest interactions, enabling restaurant hosts and costumed characters to greet visitors by name$\mathrm{.}72$ At a macro level, park operators could collect data on guest flows, which offered unprecedented opportunities to optimize future attraction planning. As an equities analyst at Deutsche Bank put it$,$ the undertaking would not be a cost center but a profit$-$booster, with the potential to drive double$-$digit returns$\mathrm{.}73$Hawaiian HotelSome in the Parks division argued that Disney would only achieve meaningful growth by venturing beyond theme parks. One team of Imagineers proposed a Hawaiian hotel concept they named Aulani, Hawaiian for messenger of a chief. Aulani would be a sprawling resort on the coast of Oahu, consisting of $360$ hotel rooms and $480$ timeshare units. The project was estimated to cost $$800$ million, excluding the price of the land$\mathrm{.}74$ Joe Rhode, a veteran Imagineer, explained the origins of the idea: We had a lot of guest information, a lot of internal information that our own people, our own guests, would love to see us do something in Hawaii$\mathrm{.}75$ The resort would boast a giant pool and water$-$play area, a spa, nightly luaus and other impressive amenities everything one would expect of Disney except, of course, the rides. The idea was to leverage Disneys renowned hospitality to create a vacation experience separate from the theme parks. The Imagineers described Aulani as a family paradise with a touch of magic$\mathrm{.}76$Without rides to entertain guests, Disney was making a bet that families would use the resort as a launching pad to experience Hawaii. Rhode explained: It increases your confidence about going out into Hawaii, and it will increase your knowledge and understanding of what you see. I dont think people would keep coming to Aulani and just staying at Aulani forever. I think it becomes a machine and engine by which you understand how to enjoy Hawaii better$\mathrm{.}77$ But some worried that guests would expect more entertainment at the property itself, and that a hotel alone would not make the resort a destination. At the time, for example, one of the best$-$known immersive family resorts was Atlantis, a billion$-$dollar all$-$inclusive destination in the Bahamas. The project, built in $1994$ for $$800$ million, featured nearly $1,000$ guest rooms, a water park and a casino$\mathrm{.}78$ Over time, another $2,000$ rooms and dozens of activities were added, including a dolphin habitat, acclaimed dining, shopping, and museum$-$quality art$\mathrm{.}79$ Hawaiis extraordinary natural beauty offered many more attractions than the Bahamas, but questions lingered about whether the scope of Aulani needed to be expanded, and whether a stand$-$alone hotel project made sense for Disney.A Path ForwardContemplating which investments to recommend t