Disneyland Resort Paris, Case Study

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Lorena Gamez                BA 522

Case Study: Disneyland Resort Paris


Student: Lorena Gamez

Course: BA 522

Date: 04.04.2007

Schiller International University

Introduction

Insufficient knowledge of the European culture and buying behaviour of potential visitors of the Disneyland Resort theme park led to an overestimation of the number of visitors and their spending in the park. On top, operating costs turned out to be higher than expected. This case highlights that the Disney as a company did not take into account customer differences or the marketing environment into which Disney was moving 

This paper aims to first give an overview of the case study, followed by a thorough analysis of methods on how to overcome some of the major issues.

Case Summary

After the success in Tokyo, Disney’s management was certain  that an European park would work. Dissatisfied with the ownership provisions at the Tokyo park, the  Euro Disney deal was structured much differently. Disney negotiated a much larger ownership stake in the park, adjacent hotels and restaurant facilities. Along with the bigger control and potential profits came a  greater risk. In April 1992, Euro Disney opened its doors to European visitors.

Located about 40 km. away from central Paris, Euro Disney it was planned to be the biggest and most lavish theme park that Walt Disney Company had built to date (bigger than Anaheim’, Orlando’s or Tokyo’s parks).It was also projected to be a surefire money maker for its parent Disney. Nevertheless, much to Disney management’s surprise, Europeans failed to “go goofy” over Mickey.

Neither attendance, nor consumer purchases were achieved during the early years: both were off by about 10%. By summer 1994 EuroDisney had lost some $900 million, and up to today, Disneyland Resort Paris is still not profitable.


    As a result, genuine consideration was given to closing the park. Then the Saudi prince Al-Walid bin Abdul-Aziz Al-Saud provided a essential cash injection ($500 million) that allowed for temporary financial restructuring and  general reorganization, including a new French CEO and a new name, Paris Disneyland. The Paris park returned to profitability and attendance augmented. However, the brief holiday on royalties, management fees and leases has now come to end and profits are dripping again. Disney’s reaction was to expand with a second “Disney Studios” theme park and an adjoining retail and office complex at the Paris location.

Questions

1) More than a decade later, has Disney’s top management completely addressed the lack of cultural sensitivity observed at the opening of the first park in 1992?

Although Disneyland Paris has made adjustments to its alcohol policy (reversing it), its dining facilities (offering a more diverse dinning options ranging from three-star-restaurants to affordable fast food or take away restaurants) and to the tram tour narrations (now offered in 8 European languages), more has to be done so that the park  reaches cultural equilibrium. In order to achieve this, the following courses of action are recommended:

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  1. Make further physical adjustments to overcome the climatic differences.
  • Having the queuing areas properly roofed and heated.
  • Offering more indoor alternatives for the rainy/ snowy days.
  • Providing more resting/“refreshing” areas for the very hot summer days (as it was the case of the heat-wave in 2004)
  1. Offer promotions that better fit European travel patterns. i.e. No longer focusing on itself as along vacation destination, but rather to appeal more to the customers who are coming for short stay (2 to 3 day-stay).
  2. Since “Europeazing” the amusement park per se is out of question (i.e. ...

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