News Quarterly Financial Results

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Feb 3, 2019
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I presume they didn’t mention where it went.
No.

Here's the quote:

"Our progress on cost reductions was masked in the quarter by a significant overspend in marketing expense of approximately $9.5 million related to less disciplined management of certain marketing related costs. We have since made adjustments to our process to better manage these costs and do not expect this type of overspend to repeat," continued Swanson.

As I said earlier. Sounds like a complete shitshow. Someone may likely have been fired over this.
 
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Would all of the Passmember perks be considered marketing expenses? There were a lot of generous benefits not initially announced but I don’t know if that would account for $9.5 mil over budget
 
Feb 3, 2019
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Would all of the Passmember perks be considered marketing expenses? There were a lot of generous benefits not initially announced but I don’t know if that would account for $9.5 mil over budget
I don't think so. It sounded more like them buying ads and such there was a good quote from the QA section that I'm waiting to get.. have to wait until the recording is posted to get it.
 

Alf33

Life is short, so eat dessert first.
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If you recall, our Chinese investor went belly up, and so the board had to react to do something to take those shares off of the liquidator and increase investor confidence. Hill Path bought most of those shares with SeaWorld repurchasing the rest.
I totally forgot about the Chinese investor issue.
 
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No.

Here's the quote:

"Our progress on cost reductions was masked in the quarter by a significant overspend in marketing expense of approximately $9.5 million related to less disciplined management of certain marketing related costs. We have since made adjustments to our process to better manage these costs and do not expect this type of overspend to repeat," continued Swanson.

As I said earlier. Sounds like a complete shitshow. Someone may likely have been fired over this.
If you look at their SGA costs, they're up a lot year to year for the quarter, despite revenue being down slightly. I'd be surprised if multiple executives/managers weren't fired over something like that. There's nothing wrong with big marketing campaigns to drive revenue, but if they fail, you're looking at a new CMO. If it's a management control issue, where they are just throwing away money, they should be looking for a new CFO.
 
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Feb 14, 2019
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Makes me wonder how the marketing overspend could happen - aren't the budget line items a limiting factor, approval needed to go over them?
 
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Sep 24, 2018
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Would all of the Passmember perks be considered marketing expenses? There were a lot of generous benefits not initially announced but I don’t know if that would account for $9.5 mil over budget
Some of those would be factored in but they are mostly fixed as a lot of those giveaways would have already been paid for it's an item with no not cost to SEAS like a free bring a friend ticket. There isn't a marketing cost to offering that. You are just potentially losing ticket revenue.

I don't think so. It sounded more like them buying ads and such there was a good quote from the QA section that I'm waiting to get.. have to wait until the recording is posted to get it.
Makes me wonder how the marketing overspend could happen - aren't the budget line items a limiting factor, approval needed to go over them?
I have theory on this. It's possible that some of the overspend is attributed to the individual parks overspending. They will likely have their overspend approved by their park president. I don't think that was park would over spend by more than a few 100k so we are maybe looking at 1/3 of that overspend. But spending on the corporate level to get to that point likely required CEO, CFO, CMO or even board approval.

Some of this could also be related to increased marketing for 2020 attractions and a push to try and push summer attendance higher and the marketing didn't have the desired effect. Honestly if attendance had seen a significant increase then this wouldn't have been an issue on the call.
 
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Feb 3, 2019
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Okay I got the quote.

*Disclaimer, exact words may be slightly off, this is just me listening and typing what I hear*

Steve wozinski (sp?) Asked:

"I want to dig a little bit more into that 9.5m marketing spend that you said was 'undisciplined'. Can we get a little more color on what that means? On what or where that money was spent on. Was that money more Orlando based on San Diego based? I wanted to dig into if this was a countermeasure to, for instance, star wars; or more of general across the board spend."

"Yeah, hey Steve, it's Mark, I can take that question - it's like we laid out in the release - we have to make incremental marketing spends and we didn't do a good job of managing/optimizing/adjusting that spend and we don't feel like we got a good return off that spend and we probably shouldn't have done it. The good news is we put a process/procedure in place to ensure this doesn't happen again. Particularly how it was spent, it was a mix of media and creative and again, we have a new process in place to ensure it doesn't happen again".




Read what you will into this..
 
Feb 3, 2019
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The original quote about the marketing overspend from early in the call:

"General administrative costs were 64.6 million dollars; and increase of 13.1 million or 25.4% and was largely due to an overspend in marketing costs of 9.5 million dollars and timing of certain expenditures that shifted into Q3. As Mark mentioned, the overspend in marketing was due to less disciplined management of certain marketing costs in the quarter. We have adjusted our processes and do no expect this kind of overspend to repeat."
 
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Mar 16, 2019
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Some of this could also be related to increased marketing for 2020 attractions and a push to try and push summer attendance higher and the marketing didn't have the desired effect. Honestly if attendance had seen a significant increase then this wouldn't have been an issue on the call.
I'm not sure how someone could spend $9 million on marketing the 2020 attractions, especially considering that SWSD hasn't even posted anything about its coaster on its social media, and whose PR department won't even tell us what it will be named. :)

Could this possibly related to Antorcha's departure?
 
Sep 24, 2018
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I'm not sure how someone could spend $9 million on marketing the 2020 attractions, especially considering that SWSD hasn't even posted anything about its coaster on its social media, and whose PR department won't even tell us what it will be named. :)

Could this possibly related to Antorcha's departure?
I didn't say it was all attributed to that. Just that some of it could be from the marketing materials that the parks created for the 2020 attractions.

I don't think it's related to Gus leaving because if that were the case then they probably would have said more about that at the time that he left and today.
 
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ˁ˚ᴥ˚ˀ

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Pantheon announcement?

I’ve seen a plethora of billboards around Orlando for SeaWorld but those aren’t too expensive.

Only two things I can think of would be tv spots and heavy handed viral marketing to drive a high price. I am curious if sales promotions would be included in that cost though. It could have been those weird end of quarter sales we saw.

Anyone see a bunch of tv adverts? Haha

In all seriousness, if they truly did spend that much on marketing, and we are having trouble finding it, that kinda proves their point about it performing poorly yeah?
 
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Apr 5, 2017
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Ok. 9 million is a lot of overage. I'm not a marketing person but what if they contracted with a major website for strategically placed advertising. Say its .05 per ad for a week. I know after visiting BGW website I get ads that pop up all the time. What if in doing this they failed to set a limit and the costs had a major overrun and were obligated to pay per the contract. I find it interesting to say that they put policies in place to prevent in the future. Surely someone in marketing couldn't blow past their budget 9 million unchecked.
 
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Jun 13, 2011
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Ok. 9 million is a lot of overage. I'm not a marketing person but what if they contracted with a major website for strategically placed advertising. Say its .05 per ad for a week. I know after visiting BGW website I get ads that pop up all the time. What if in doing this they failed to set a limit and the costs had a major overrun and were obligated to pay per the contract. I find it interesting to say that they put policies in place to prevent in the future. Surely someone in marketing couldn't blow past their budget 9 million unchecked.
Damn interns
 
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