Fortnite Comes to Halloween Horror Nights, Orlando Market Slows

0:00 Okay, from our studios this week in Los Angeles and Tampa. This is Green Tags Theme Park in thirty. I'm Philip from Gantam Light and Control, so I always forgot to say that. And Scott Twinson of Scott spenscing Care Development is joining me as always and this on Green Tag Theme Park and thirty. We look at the top news each week in the theme park world and we pick what we think are the best stories that are most important for theme park professionals. And this week, although we're gonna try and dip our toes into the controversy that is Fortnitemares, and then we're gonna look a little bit more about the earnings and why the Fortnite story sort of eclipsed the softening demand in the Orlando market that we're seeing. But anyway, uh, Scott, We're gonna start off here.

0:46 Have you played Fortnite? Tell me this? Have you played Fortnite? No? Okay, I am me there. I am familiar with it as far as the popularity, the characters, some of the characters, the concept ish sort of kind of right. So let's but I think you know, as we dive in here, why don't you set the stage for us. Why don't you set up because there's some people who may not be in the Halloween part of our industry who may be like, what is you talking about this fortnitemares? Right? So Fortnite is a very popular game that neither Scott of I have played because we are old. Sorry, but which not tedtris? I can't. I don't know. It's gotta be. I'll tell you that. You know, you can play Solitaire now. It's amazing, I know.

1:31 So Halloween Hornites is bringing Fortnite, the most played console game in the United States, as a scare zone to both both coasts, to both Hollywood and Florida this year. Guests will drop into the world of Fortnitemares is what it's called Fortnitemares and move through ever evolving, high stakes environments modeled on the game's fall event, and you can expect to see the Battlebus and familiar Fortnite Mare characters, plus a few new additions exclusive to Halloween Horrnites. So basically, Halloween her Nights is making a physical walkthrough translation of the game's annual moment because this isn't a game event that happens every year, and so they're making it they're bringing into the fiscal world. There also are hints that. There's going to be some sort of gamification or some sort of quest or things, that some sort of role that the guests should be playing when they are walking through this, because it's modeled after the game event, of course, and so this has sparked a lot of controversy in our community but also kind of broken out into the mainstream, and I wanted to put context around that. The reason that this has gone so big is essentially I'm just gonna break it down, but essentially Fortnite is larger than Halloween Horn Nights, and it's larger than Universal like studios, like as a brand.

2:46 It's larger. So it's interesting because I think that's why where it's sort of like this enormous fandom. And some numbers for you. I mentioned already it's the number one most played console game in the United States, but also they put the lifetime registered players at more than six hundred and fifty million, and during twenty twenty three, there was more than one hundred million that were like active confirmed players. It's also known for its big events sound familiar. It's known for like these big communal experiences where all people get together and do these massive events. How massive you might ask, Well, the in game events are the closest thing that it has, like dadium concerts. So for example, Travis Scott's twenty twenty Astronomical Show drew twelve point three million concurrent concurrent players, and the Epic Remix finale in November of twenty twenty four hit an all time record of fourteen point three million concurrent players. So just these are massive, massive events.

3:44 These are all people that are logged in experiencing these communal things at the same time. So there is an interesting crossover where it's already an audience that is kind of used to like showing up and participating in communal events and playing roles and doing things, and so then hhi and taps this. So I think where the controversy has come is where the Halloween Hornites fans or the people that enjoy Halloween Hornites are concerned about a few things that we've been talking about. One, they're concerned about minors, they're concerned about chaperone policies, they're concerned about potential takeover risks and all this kind of stuff that's coming from our industry and from of some of the theme park design people basically wondering, how are we gonna how are we going to make sure this event kind of stays safe and stay scared and all that, and kind of worried about that. Then there's the people from the creative standpoint, which are arguing that this is a breakdown of the Halloween hornites because it's not really like a Halloween property or any of those things. It's like it's a it's a game, and you know you're bringing this in. I guess my counterpoint before I get your take as someone who's done this for a long time and gone through all these same issues, but my just take, hot take from a historical standpoint is that is not the first time that they brought in gaming ips like a Fallout last year. And I would also argue that this is literally an in game Halloween event. I feel like, if you're comparing it to like Fallout, which doesn't have a Halloween in its world and you're bringing that in, I

5:16 kind of feel like, and I guess for me putting in perspective of FanFest nights, also, this is clearly a strategy that Universal is trying where they're trying to tap into really rabid fan bases in other genres and pull them in, And I think the crossover is enough. Like, honestly, I'm like, it's enough. It's a it's a Halloween event that happens in the game. Put that in the real world now it'll be interesting because I do think it opens up a possibility for passes that are not even May's passes. So if you look at what Horror and Leashed. Is doing where they sell that thirty dollars scaredy Cat pass that doesn't include the haunts, I could see that being a whole new revenue stream here as well, where you can sell a event only pass that does and include haunted houses whatever. Also, last thing, I think it's a pure revenue play because parents, you know, like you're gonna have to buy tickets for your kids and potentially your chaperones to all go and they're just all going to stay in the same area. But from a security and a crowd perspective, I could see how this could be potentially problematic.

6:18 But Scott, you're the expert, you tell me, what do you think? Well, I think the first thing we have, the first thing we kind of have to break in my opinion. We have to break this down a little bit. You know, you quoted these gimungous numbers for in game events. This is not an in game event. This is a real life event. This is this requires travel, This requires hotel rooms, This requires a hell of a lot more planning than logging in. So I understand. I agree with you that it's a money grab. I agree with you that this is a I mean, it's it's sort of like and the one that failed was when they when they did the Weekend for example, I mean, talk about talk about something that has absolutely virtually nothing to do with Halloween.

7:03 Yeah, that's a good example, right, They just kind of made it. They made it Halloween in their own way. And and there's nothing wrong with the weekend. I'm not saying the Weekend is a bad brand. I'm not saying that. You know, it's just it's just it's a force fit. In my opinion, that was a forcefit. This again, I think you have to I think, and this is something that I've always wondered about Universal and how and I've seen them over the years have some success from time to time, but mostly it just kind of goes well when you try to bring something that is that you have such dedicated fans too, and as you've seen here, millions and millions and millions of dedicated fans. When you try to bring it into the real world, it's not nearly as exciting because you can't. You know, you have to rely on things like the laws of physics, you know, basic costuming, laws of gravity. There's a bunch of things. There's a bunch of things to get in the way when you're trying to recreate something that exists digitally. Now that said, it says you know, as you mentioned that, there are some specific Halloween horonites, a few additions that are exclusive to Halloween horonites. That's where the uniqueness comes in. You know, we've often said that a really good balance is if you're looking at an IP, you think about it like a three legged stool. It has to represent the overall

8:35 brand of the park, the brand of the IP, and the season with which you are bringing it into the park. So there has to be enough Halloween, there has to be enough Fortnite, and there has to be enough universal. So that's the magic in my opinion, that's the magic balance that they're going to have to try to find and I can't tell you what that is because I'm not educated enough in the brand, nor do I have any inside information on what Universal is actually trying to drive forward. I do understand Halloween. So they need to make certain that, whether it exists or not, that there is a reason for Fortnite to be taking place in a Halloween event. And sometimes that's difficult, sometimes it's not.

9:19 Sometimes it's really really easy. You know. It kind of goes back to the adage that I've used for over thirty years. A good haunted house is insert a place or in this case an ip and add the phrase gone horribly horribly wrong. So it's what is it about, What is it that's happening in the world of Fortnite that is Halloween related, and how does that contribute to the overall Universal or in this case, Halloween Hornite's brand. So you got to make sure that they all three play nights together, because if you lean too far, if you make it too Halloween and not Fortnite enough, the Fortnite f are furious. If you make it too Universal but not Fortnite enough, then you've got you just have to be very very careful. You have to find that balance because you're dealing with you're dealing with a merging of fandoms which are adjacent. I'll admit, and I think it's a I don't think it's a bad choice necessarily. It just as we say almost every show, it depends on execution. So it depends on how well they can balance between those three I mean basically those three brands, the Fortnite brand, the Universal brand, and the Halloween brand. You cannot forget the Halloween brand. And this is true whether you are dealing with a high end brand, a highly recognized brand like Fortnite, or whether you are trying to create a Halloween event for an attraction that has its own separate brand. You've got to be true

10:52 to the brand that is. Let me rephrase that. You can't necessarily completely undermine or dismiss the brand of the attraction. You have to at least recognize it and choose whether you're going to reinforce it or you're going to go for an audience adjacent to it or outside of it. But you have to make that choice consciously because that's going to impact how you implement the brand and how you make it halloweenish. Halloweenish? Did I almost say Halloween, no halloweenish. So it's finding it's finding that balance between those three things. I think that could make it successful. I think the biggest challenge you're going to have is, no matter what they do, because it's live, it's not going to be Fortnite. Right. What I think is interesting, and I think we've seen this happen in the industry a lot is you know, first person gaming was designed to replicate real world, and now it has replaced real world, and now they're to bring it back into real world.

12:01 So unless they unless they have some very clever and there are times that Universal completely surprises me and they will come up with some unique technology or some unique way of staging or writing or whatever. But you know, if it's if it becomes a uh, here's a piece of paper and a pencil. You got a scavenger hunt going on. That ain't Fortnite. So you gotta be you gotta be really careful, excuse me, really careful with that. And I think as long as they can identify why Fortnite fans are Fortnite fans and make sure that that element, that essential essence is there and that and make sure that it works in harmony with people who are Halloween fans and people who are Universal fans, then I think they could have something successful. But this is this is always the caution that I put out with IP in general, and that is just because you can get the IP or just because you have the IP does not guarantee that you're going to be able to glean profit off of the success of said IP. You have to have a way to integrate it into your experience. So that's no matter what it is, whether it's Fortnite or I don't know, Roodolph the Red Nose Reindeer for a Christmas event.

13:19 Make sure you have a way to integrate it into your event that satisfies the IP brand, your brand, and the holiday brand. YEP. I really like that, Lens. I think that it's going to depend, like you said, on the execution and really thinking about what you said, like who, why do the Fortnite people like Fortnite? And how do you make sure that is echoed at the event enough to actually win them to get there. I will say we've seen similar things with five Nights at Freddy's right and with Terrifier a little bit. And it became clear to me. Last year at Halloween horn nights that.

14:00 Honestly, even if it would for finance at Freddy's, even just putting the cutout, like there is a line of people just take pictures with the cardboard cutout of the characters, and then there's people that want to take pictures of the really horrible cupcake, the actual cupcake, of the cupcake right where it was like all frosting, And so it's a. I think it doesn't have to be that hard in that. You know, honestly, they probably could just put up photo ops and I think that would that you'd be shocked at how how far good photo ops will get you when it's a fandom that's very rapid for them and they haven't necessarily seen them in the real world, which is the Finance at Freddie's thing, where you haven't seen these puppets in the Liddalle world, and so it's like it's such a it's so rapid.

14:48 So I think, don't underestimate that. But I agree with you if they try and force a thing like an activity that is inherently not Fortnite onto Fortnite people, it's going to backfire versus just putting a photo op. Well, and also you know operationally, how is it? How are they going to make it work? You mentioned terrifier. Terrifier was a disaster at first, it was, right, because that's why I mentioned it, Yeah, because it was it was, oh, yeah, well we'll just you know, we'll just put him out there and he'll just appear randomly and blah blah blah blah blah, and either he was mobbed or people were bitching because they didn't find it. So and then well I was going to ask you on that same line. Right, we've been talking so much about how Parks I guess maybe just six lags, but like Parks, I think in general and a lot of places are trying to get away from the tween audience, right, quite deliberately, trying to rebrand or remarket or move up the the audience chain away from that demographic.

15:42 And this is the reverse. This is universal, quite quite, I mean, there's not much you This is a lot of the concerns from our industry that came from the operations people of like you are quite literally targeting the exact demo demo that does the team takeovers and how many stories have we done on team takeovers? Like, so, what are you going to do to mitigate that. And the only thing I can think of is that this is it's the infrastructure they already have in place. They already have security, They already like they unlike an FEC or unlike a bowling center or some of these other places. These places already have infrastructure to absorb, they have security, they have all of the stuff in place. They also have the ticket gate.

16:22 I mean this is behind a ticket wall, so you have to have a ticket to get in. So I think the price might mitigate that by itself. But I will say that, you know what, what's just outside the park? Yes, both locations. That'd be a great place for a takeover, wouldn't it, right, And whether it's kids coming in to see fortnited Hornites or kids who have seen horrnites fortnited Hornites and are coming out, Yeah, I think it's interesting because what I'm trying to do is I understand. I understand why they're going for it because it is a lucrative market. Yeah it is.

17:03 There is money to be spent. These are kids who aren't saving for college at These are kids who their parents are gonna say, oh, you want to go see this this video game thing at at at Universal. Here, great, here's some cash, or here's your card, you know, here's your debit card. Run go have a good time. And uh, there's just you know, the money flows because they want to be able to say I got the the exclusive Halloween Hornet's Fortnite shirt or whatever the hell it is, and or I experienced it and I created content while I was there and I got to see that. So it is kind of like printing money. But you're absolutely right, it's it's a there's there are some there are some risks involved, and I'm sure that Universal has looked at it.

17:49 I mean, let's be honest. Universal has always kind of targeted that market. What was the what was the what's the is it silent Hill? Well, what's the one with the big yeah pyramidhead personally, Yeah, you know they've gone the last The last ip they did that I absolutely had to go see was American Werewolf in London. So that goes that shows you how long that was. But but they've targeted these it's not I guess it's nothing new. They've targeted these these borderline things. What's happened, what's changed is the audience. What that tween audience is has changed or early teen early.

18:33 Teens, and we've talked about that too, where where kind of the behavior has changed to the market behavior since the pandemic. I also want to add though, what we've been hearing from a lot of the operations people, because a lot of people texted me about the story to talk about on the show, and they share their opinions with me. But they pointed out to what I heard is that making this a scare zone was a bold choice because if it's a house, you can at least control the line, right. If it's a scare zone, it's like you have just a It's like it's just asking. It's almost like takeover bait. I I can see. I can see two sides to that, to that comment, because from an operational standpoint, you put a bunch of of hyped up teams in a queue that's not moving fast enough for their liking, and that becomes a disaster waiting to happen. As well. Also, with a scare zone, you are in a more open space so that you can see what's going on. In a haunt, you know, no matter how much security you have, no matter how no matter how many cameras you have, there's always going to be those those blind corners where you know, I hate to say it, but where the ill gotten, ill gotten youth can go and beat the crap out of your actors. So or just dismantle your your your scenic So I can see, I can see both sides of that one. I think I would probably vote to

20:04 put it in a scare zone though, because I think in a scare zone you have a little bit better. On the one hand, you can you have the mass mentality that can kind of take over. On the other hand, you can immediately come in from all sides. You know what I'm saying. I mean you can you can disperse quickly as opposed to as opposed to evacuating a haunt. Right right, And then you can staff that area too. I mean, yeah, you can. You can set up things that disperse the area and keep people going. And if you put it in a place where it's not blocking traffic, then you can you can. I don't know where it's going to go yet, but. Let's face it, how many times have we been in any universal experience, And whether it's in a haunt or in a scare zone, there's always at least somebody there in a uniform with a wand trying to wave you through because there's a crowd for me. As long, like I said, as long as they've done their homework, as long as they understand here's what could happen, and not just well we've done we've done games like this before and it wasn't a problem. Well it's a whole new world now, right, So well, hopefully they're thinking about it.

21:19 I think they might be thinking about how they are going to try and make up for their bad summer numbers. That's what I think, which is exactly going to our. Probably last story of the show. By the time we get through it is universal posted their earnings and I'm just going to give the til dr on this, which is guests who come are spending more, but fewer guests are coming. That's the takeaway from the entire earnings call. There you go safety like two hours and it's we can look at the numbers, you know, but that's what it boils down to. Ibita is down, which means that they're making less from people, but that people are spending more due to inflated prices. That's what's going on, and they're blaming the macro environment.

22:00 That's it. That's what's going on. They're saying, turning to the parks, the operating environment has softened more than we anticipated. Growth in Orlando came in below our expectations as the tendants began to soften in June and has remained pressured into the third quarter. They also explained how a tendants across the broader Orlando markets has begun to soften in June with some temporary factors at work, including higher fuel prices and weaker consumer sentiment, and when asked directly in the Q and A, Kavanahau described essentially weakness and attendance driven by weakness and consumer sentiment at high and higher travel costs, and he says they do not view it as a permanent change in the outlook. Well, yes, because they're going into Halloween season and all in season is clearly what they're betting on with the things we just literally talked about for twenty minutes.

22:47 So one note here is they said specifically at EPIC, we continue to see it doing well, that doing what we wanted to do is delivering against our expectations. Kavanaugh said, creating it with driving higher per cap spending and strickening broad to Orlando as a true multidestination resort. His summary of the problem is that it's an overall demand drop that's sitting all of Orlando more broadly. A few two more interesting threads. One is that Japan is doing worse apparently where and it's coming We've talked about this, but basically it's coming from the Chinese tourists that you're dropping, and that's because there's been that those geopolitical issues happening between China and Japan, where China is still upset at Japan for Japan for arguing for Taiwan independence, and so because of that, China is discouraging people from traveling to Japan, and so they're seeing a drop in their Chinese tour numbers which they're not recovered from. So that's what's going on there. And then the last thing that kind of got in our industry they got some people upset was this comment they made near the end, which they're basically they were just summarizing that it's a long cycle business, kind of being like we're in it for the long haul, as long you know, we're going to get through this diplah blah, but they said that we're again one of two players. It basically went to discount how it's only them in Disney and nothing nobody else matters.

24:12 Is that kind of the gist of that. And they talked about the Universal Kids Resort, which I would not have brought up honestly. If it would be on this call, I would have stuck to Epic. And then they also pointed out how the Universal UK is proceeding and they're going through zoning clearances and those elements. So that's sailing calling a nutshell. Mean, while I look at the shiny new thing over here in Europe, that's really what they're doing. That's really what they're doing. Yeah, that's it, that's it. It's it's distraction. Now. We talked about this on The Bonus Show last week. I wrote an essay about this, and it was crazy about the timing because I wrote the essay and we talked about it on The Bone Show last week about the idea of really that summer is becoming the shoulder season.

24:58 And the whole premise is that it is what's the value proposition? All it is is the same core product with nothing additional, and if your core product is weak or if the macroeconomic environment is challenging, it becomes harder to sell. And then when you look at all they have planned for Halloween. So I guess, what's the calculus If you're going to spend your money and you know, come when you can see all the Halloween stuff, you can stay all day, get the whole core product, plus do the combo ticket. And I just want to know, doubt this year. This year their combo ticket is going to allow some hot houses to open at two pm in Orlando, so similar to what. They do in Osaka. So really, what's the calculus?

25:39 You could buy one ticket and stay the whole day, get all core product plus all of Halloween, even by express if you want, Why are you going to come in the middle of the summer when everything is hot and you get no Halloween or any additional product. So it's really I think that's that. I think that's part of it. And we talked about the softening demand literally last week, and then it showed up on the earnings call, and. Anyway, well it's and what I think is interesting too is it kind of goes back to the really bold statement I made a while back, which was I don't know how much longer the megaparks are going to be the be all and end all. I think that, you know, because they are so expensive, they have priced themselves out.

26:28 I think that you know, we've heard this. We've heard this, attendance is down, but in park spending is up. We've heard this in multiple earnings calls over the last probably year and a half to two years. And so that's great. You've got a core audience that loves to be there. Your attendance is down, your in park spending is up. They still haven't found then that balance to keep their profit margins up, because if you know, is it is it financial that has driven them away? I don't know that. I don't know that. I think there's I think because what happens is when parks go, when parks start to have trouble, they immediately go too well, gas is too high and travel is too expensive. And they never say their parks are too expensive, which I think is interesting.

27:14 But they say everything around the parks, it's everybody else's fault, but us, everybody around the parks is too expensive. And my response is there was a time when at like Walt Disney World, for example, families would go to Walt Disney World maybe three times in a child's life. It was you'd set up so that you'd go, enjoy, go back to the Midwest, spend another four years, come back again, do it again, go away. It wasn't the oh gosh, I've got to have I've got to have a reason to go every fifteen minutes. So I think that that the way we consume parks is actually leading to this.

27:59 It's like, because nobody can afford to go every fifteen minutes because the pricing is so high, you know, ticket prices, individual ticket prices are so high, even even passes are high. I think, well, so I have some data points on that really to add in to finish out this. So they didn't put this on an urninges call, but they have dropped discounts for pass holders for Epic Universe, so up to forty percent off basically to go get day tickets for pass holders in there. And meanwhile, they mentioned that they're hoping the Fast Inferious roller coaster is going to make Hollywood, you know, bump that up. But they haven't announced an opening date yet, like they still, I mean it's been delayed. Still haven't really announced it and then related to all this just as a thing. Tokyo Disney is actually raising its prices for the October season for the first time in a very long time, and six Flags has just launched a huge Christmas in July summer sale where they're doing single day tickets from thirty five tall and double day tickets from two day tickets from fifty to seventy eight dollars to pen.

29:04 Where it is and it all cuts off. You can use it basically all up until the Halloween season starts and then it's over. So so maybe they're starting to realize the parts are a little bit too expensive, at least for what they're offering during this time, right, so they're starting to put some discounts in well. And the thing is there and people don't notice it until all of a sudden, the because there's a much more there's a much more educated consumer there now who will look at I can get the core product and the seasonal overlay at what it's like, Wait a minute, well, why would we go here and just get the core product? Core product is definitely worth a ticket price, but it's it's like it's a value proposition, and people aren't. People aren't stupid about that anymore. They do their research, they look at it. There's a whole generation out there who have young children who are doing just that, and so you I think what we're seeing here is an equalization.

29:57 I think we're seeing them try to figure out, Okay, we've hit we hit the max that we could charge people on a daily Now we got to figure it out because now it's starting to have diminishing returns. So we've got to find that balance again and find that equalization. And hopefully you know, to me, it's not I don't look at it as a catastrophic news. I see it as they're having to rebalance and write size. The problem is the industry didn't have to do this kind of right sizing multiple times per year. They had to do it once every three to five years, where they'd go, Okay, maybe we should maybe we can charge a little bit more, or maybe we need to offer some discounts or whatever. But the attendance base and the attendance behavior of guests is very fluid and they need to find a way to adapt quickly, and it sounds like they will. But like I said, the percentages are not We had a fifty percent drop. That would be terrifying, but that's not what they're saying. So hopefully they will find a way to right size this, and hopefully we can find a way to put an end to this show because our time is up. So guys, thank you all so much for watching or listening. My name is Scott Swinson with Scott Swinson Creative Development and my amazingly wonderful, brilliant, hardworking co host mister Philipernandez from Gantum Lighting and Control. This is Green Tag Theme Park in thirty and we will see you all next week.