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GROUP

MEMBERS
1.
2.

3.
4.

Dotty Cinco
Ma. Anna Chanese
Lescano
Jessica Tabina
Jerome Tumambing

TABLE OF CONTENTS
I. Case Background_____________________1
II. Statement of the Problem______________3
III. Alternative_________________________3
IV. Recommended Solution_______________3
V. Answers to the case
questions_____________________________4
Question No. 1:________________________4
Question No. 2: :_______________________4
Question No. 3: :_______________________5
Question No. 4: :_______________________5
VI. Learning___________________________5

BACKGROUND
INFORMATION
Walt

Disney Company is the world's largest park


operator. In addition to the usual rides, games and food,
it runs all its parks as theme parks - amusement parks
that focus on a particular motif such as cartoon
character or animals. Disney has five theme parks
outside the United States namely:
Tokyo Disneyland, Tokyo DisneySea, Disneyland Paris,
Hong Kong Disneyland and Walt Disney Studios (a

BACKGROUND
INFORMATION
Disney operates seven of the world's ten most
attended amusement parks. Opened in Hong Kong in
2005 and in Tokyo in 1983 - which is the most attended
of all parks today;
Disney is motivated to set up parks worldwide to
increase its sales of goods as well as attendance to
their theme parks. After lunched Hong Kong Disneyland
in 2005, Disney has signed a letter of intent to create

PROBLEM
STATEMENT
1. How Walt Disney
will be able to
adjust to the local
culture, norms, and
even climate, in
their operating
regions.
2. For the Shanghai
Project, How will
Disney be able to
compete head to
head with the
thousands of other
operating
amusement parks
in China.

For Shanghai Project


Since

more people go to
city in east of China for
the vacation, Disney could
set up the theme park to
other city in east of China;

Add Chinese culture


element to the goods and
building.
ANALYSIS OF ALTERNATIVES

DETAILED
RECOMMENDATION
Conduct

careful study of the


potential market which includes:
Risk, Behavior, Cultures, Economic
conditions, Government policies
and political situations, Business
operations strategies
Focus

on regions that are great


potential market
Adjusting

the brand to suit local


taste without compromising it
Disney

needs to adjust to the


climate issues by installing
fireplaces, protecting waiting lines
and placing a dome over the tea
cup ride

ANSWER TO CASE QUESTIONS

QUESTION 1
What do you think motivated Disney to set up parks
abroad and what might be the pros and cons for the
Walt Disney Company.

Like any other businesses, the primary goal of all for-profit


organizations is to gain profit. It is inherent for any
businesspeople - small scale or big scale- to expand when he
sees things are doing well - the existence of a potentially
sustainable market and growing demand for a product or a
service. As for Disney, expansion of operations abroad meant a
larger market base, hence larger profits. The presence and
recognition of Disney's branding abroad also creates following
for its future products/campaigns ensuring profits for the
company.

QUESTION 1

Also, the creation of jobs and other indirect


businesses in the host country is another
notable advantage. However, like any other
multinational companies, Disney had to face a
lot of challenges
when it expanded
internationally. The management has to take a
lot of failures/adjustments to ensure the
sustainability of its operations abroad. For
instance, the culture of the people of the host
country was not carefully studied. This led to a
lack of support from the locals of that host
country which led to Disney's failure at the
onset. Also, Disney's decision to stick to the

QUESTION 2

Why do you suppose Disney made no financial


investment in Japan, one in $140 Million in
France and one of over $300 Million in Hong
Kong?

The management of Disney probably projected the


brand's profitability based on the perceived value of
the people in Disney services/products in each
country. In Japan, for example, since it has its own
brand of cartoons (anime), the management may
have not thought that Disney will be successful. In
France and Hong Kong, on the other hand, Disney
based its projections on the number of people
visiting the location each year without considering

QUESTION 3

What factors in the external environment that


contributed to Disney's success, failure and
adjustments in foreign theme parks
operations?

Success:
Brand Popularity
They focus on the region where there is high market
potential

QUESTION 3

Failure:
Not being able to analyze extensively the economic
conditions of the regions;
Not

taking into consideration difference/diversity of


cultures, climate, and political stability of their target
regions.

QUESTION 4

Should Disney set up a park in Shanghai? If so,


what types of operating adjustments would it
make there?

Without taking in consideration that the construction


is currently on going, we believe that still, Shanghai is
a great location for another theme park.
China might have a negative track record of
amusement parks, but China is still China. A tiger
economy with a current state-based focus on
promoting tourism and entertainment, Shanghai will
surely attract huge number of tourists.

QUESTION 4

China's demand for theme parks has been fueled by


several factors, including China's growing middle
class, which has money to spend but few options for
leisure activity. A recent move by the Chinese central
government to relax building permits for theme parks
has also spurred development.

QUESTION 4

By 2020, China will outnumber the U.S. in parkgoers.


Parks operated by the Shenzhen tourism company OCT
Parks China already attract more than 26 million visitors
a year, behind only Walt Disney Attractions, Merlin
Entertainment Group, and Universal Parks and Resorts
in total attendance, according to the AECOM study.
Therefore, in order to sustain the lead in the theme
park industry, Disney, thru its best effort, must try
adapt/incorporate more Chinese culture and/or
characters to make the best out of Shanghai.

LEARNINGS

Mere statistics cannot project future profits. As for


Disneyland Paris, they projected that the location, the
number of tourists visiting Paris (compared to other
parts of Europe) and local government's support
would predict the success of the Disney brand in
France. The management was not able to carefully
study the culture of the people in that country. They
were not able to consider how the population valued
their culture which then led to its failure.