Almost all of the major theme park attractions in this country have been hoovered up by the private equity firm The Blackstone Group. I remember saying
back in 2007 that this was not good for the park despite others getting sucked into the PR spin that this would enable Alton Towers (as Merlin's "Jewel in the Crown") to become one of the world's leading theme parks once more.
Private equity firms are only interested in one thing. Buying, bulking, and then selling off for the highest possible profit. They are the business equivalent of a pig farm where pigs are bought, fattened up as quickly as possible and then sent to the slaughterhouse regardless of quality.
It is striking that the private equity owners of these theme parks are the very same owners of the Southern Cross care homes that have been in the news for the past week. These care homes have got into such financial difficulty that their patients have faced a significant reduction in the quality of care and now face possible imminent eviction with bankruptcy for the company. How did a longstanding healthy company get into this mess? Well Blackstone got involved. They stripped all the assets from the business by replacing equity with debt. Eg. They sold Southern Cross care home properties and then rented them back. Except, now that rents have increased they can no longer afford to exist in their own buildings because of the huge debts incurred as a result.
I'll leave others to fill in those of you who don't know, but the same trick has been done with this theme park. Alton Towers no longer own Alton Towers. Alton Towers pays rent to exist at Alton Towers.
And leaving that problem aside, there are others that filter down too...
The whole business attitude, that extends from Blackstone, and that also thrives in Merlin; filtering down to Alton Towers and Thorpe Park etc. is a flawed one for running a theme park.Private equity firms are not a bad thing in themselves
. Many businesses can benefit from them investing in the right place and making them an efficient venture. It's perfect for companies buying and selling products.
But like the care homes, theme parks don't sell a product - the PR people who claim they actually are, are fundamentally mistaken. They're selling life itself; they're selling a comfortable experience in care homes, and a fantasy experience in theme parks.
The things that say value for money in these parks are not necessarily quantifiable in the short or medium term. But these same things are what make people come in the first place and what make people want to come again. These sensory details, these stories, these elements of "magic" even; these things can't appear on Merlin's graphs because they are ephemeral.
It is the legacy of experiences set up in the 90s that feeds Alton Towers’ profits today.
There needs to be an exceptional person put in charge of this key area and inserted right at the top with the authority to step in and query the decisions of each and every department.
It's not surprising that John Wardley is so popular in this regard when you consider he brings his talents from the world of theatre. It's not surprising that those theme parks that are owned by film companies or individuals in the entertainment business tend to be so popular...
It's not just because of the investment power behind them (though that is important in kick-starting the cycle) it is because they fundamentally understand how to interact with the emotions of their audience. They put considerable time and effort into things that seemingly won't bring in a single extra penny for the park... Except that they know it will, actually, in the long term; these details build over time into a collective experience, which, perhaps only on a subconscious level, affects the customer in a way that will make them return or recommend so much more readily than those who have just had a day of quick thrills on rides. A 2 minute thrill on a rollercoaster is a product; it's what surrounds it that makes it an experience. And that's why what they did to Oblivion was such a fundamental mistake.
Alton Towers no longer has total control over its own future. The horse has long bolted now on equity vs debt. but it still has control of the business it runs within that frame. If they can change to a more experience-orientated/detailed/magical - even - way of doing business, and can convince Blackstone to invest along these lines instead, then there are great and exciting years ahead for this park.