BEDFORD, England — In a world increasingly tethered to screens, the allure of real-life thrills remains a powerful draw for families, especially at theme parks. Despite the rise of AI influencing various sectors, the $100 billion global theme park industry sees “big metal” rollercoasters as its main attraction.
Balancing Tech with Tradition
Merlin Entertainments bets on real-life experiences over excessive tech.
- Merlin Entertainments emphasizes real-life experiences over virtual reality.
- The company is simplifying its global operations to function as one entity.
- Universal is building a new theme park in Bedford, UK, slated to open in 2031.
- Merlin is securing intellectual property deals with brands like Peppa Pig and Paw Patrol.
How does Merlin Entertainments balance technology with real-life experiences? According to Fiona Eastwood, the head of Merlin Entertainments, real-life experiences provide an “antidote to phones and digital technology,” even as they explore AI and other tech uses.
Eastwood, whose company operates 130 attractions across 22 countries, including Legoland, Thorpe Park, and Alton Towers, emphasizes the importance of real-world experiences. “Tech definitely has a role, but you can’t beat the real experience of height, of speed, of big metal and that real life experience – because if you’re not careful technology can be everywhere,” she says.
Artists add the finishing touches to a Queen Camilla wax figure at Madame Tussauds in London.
VR setbacks and lessons
Eastwood recalls the company’s experience with virtual reality headsets on the Galactica ride at Alton Towers. The headsets were eventually abandoned after visitors didn’t enjoy them.
“What we discovered was that it took people away from being together, they felt on their own, they may as well have been at home,” Eastwood explains. “Of course technology has a role, but that role has to be not just doing it for gimmick’s sake… ultimately I’m a strong believer that it’s the real [life] experience that we are delivering.”
Competition heats up in the UK
Comcast, the U.S.-based parent company of Universal, is set to intensify competition in the UK and Europe. They are currently building a theme park in Bedford, with an anticipated opening in 2031. The park plans to feature a 115-meter high rollercoaster, poised to become the tallest in Europe. The project has garnered significant government backing, including £500m of public investment in rail and road infrastructure, including a new railway station.
Eastwood acknowledges the new competition: “It’s a great opportunity for the overall market… The entire theme park market benefits.” However, she also stresses the need for fairness. “We need to make sure that if Universal are given any special treatment, that that special treatment is also given to the entire industry,” she added, noting the difficulties of obtaining planning permission in the UK.
The virtual reality headsets on the Galactica ride at Alton Towers were ditched after theme park goers didn’t rate the experience.
Streamlining operations and expanding globally
Eastwood is focused on streamlining Merlin’s global operations. “Merlin has grown up over many years as separate sites which have operated independently,” she says. “The big shift in our operating model was to become one company. For example, in the UK what you don’t want is Alton Towers doing something at the same time as Legoland Windsor.”
Demonstrating this global focus, Eastwood recently attended the opening of Legoland Shanghai, Merlin’s first attraction in China, which is the world’s second-largest theme park market. “It’s a big deal for us, it’s been many years in the making,” Eastwood noted, describing the park as “a real fusion of east and west.”
Legoland Shanghai has Legoland staples such as the dragon coaster and attractions with a more specific appeal to local and regional tourists.
Financial performance and strategic responses
Merlin, like Disney and Universal, is grappling with cost-conscious consumers. Last month, the company reported that while visitor numbers rose slightly to 63 million last year, revenues decreased by 3.2% to £2 billion. The business reported a pre-tax loss of £492 million, following a £214 million loss in 2023.
To combat these challenges, Merlin has increased its marketing budget by £10 million to £100 million and is increasing promotions and discounts. The company has also hired marketing talent, including Craig Inglis, known for his work on holiday advertisements, and Toby Horry, formerly with Tui.
Merlin Entertainments also operates franchises including Madame Tussauds, Sea Life and the ‘Eye’ wheels in cities including London.
Securing intellectual property
Merlin has been actively pursuing deals to secure intellectual property rights for its parks, including agreements with the rights owners of Peppa Pig, Sony for Jumanji, Microsoft for Minecraft and Paramount for Paw Patrol.
“I’d say our biggest competitor is entertainment in the home, or indeed, increasingly bedrooms, where kids have access to gaming and the internet,” says Eastwood. “What is in our favour is when you look at all the research, increasingly parents of kids aged from six to 12 and beyond actually see the home as a battleground.”
Eastwood added, “They’re trying to get their kids off screens. We know that what parents value is an opportunity to be together and experience a world outside the house… We’re almost an antidote to the phone and digital technology. What we deliver is that escapism.”
