Q-1) What do you think motivated Disney to set up parks abroad, and what might be the pros and cons from the standpoint of the Walt Disney Company? Ans: The Walt Disney Company also known simply as Disney is the largest media and entertainment conglomerate in the world. Founded on October 16, 1923 by brothers Walt Disney and Roy Disney as the Disney Brothers Cartoon Studio, the company was reincorporated as Walt Disney Productions in 1929. An early and well-known cartoon creation of the company, Mickey Mouse, is the official mascot of The Walt Disney Company.
Walt Disney Parks and Resorts is the segment of The Walt Disney Company. Disney is motivated to set up parks in abroad because of some reasons. Those are: ? To expand sales of their merchandise goods as well as attendance to their theme parks. It can attract more tourists to visit in it. ?Disney is motivated to also acquire more resources by their expansion, for example, Disney wants to create theme park in Shanghai so that it can facilitate in probably creating a Disney channel for the Chinese people in Chinese language. ?Disney is motivated to set up parks abroad to minimize the risks of their parks in United States.
If the theme parks in United States do poor business then Disney could gain profits from Disney theme parks which are situated in abroad. Pros standpoint of the Disney: ?To Sales expansion ?To Resource acquisition ?To Risk minimization ?To gain profit Cons standpoint of the Disney: ?Cultural factors: There are cultural factors which will inhibit the company from conducting business. For example, Paris was concerned that Disney was ruining their culture with American products and ideology. So this problem almost bankrupted Euro Disney. Geographic influences: There are geographic influences to see where to place the park and where it would be profitable. Also, which area is closer to the population of the area and mass transportation facility is very much needed. ?Competition: Competition of amusement parks is a matter of thinking. ?Political and legal situations: Political and legal drawbacks of certain countries becomes very harmful for Disney theme parks in various countries. Q-2) Why do you suppose Disney made no financial investment in Japan, one of $140 million in France, and then one of over $300 million in Hong Kong?
Ans: Walt Disney Parks and Resorts is the segment of The Walt Disney Company that conceives, builds, and manages the company's theme parks and holiday resorts, as well as a variety of additional family-oriented leisure enterprises. It is one of four major business segments of the company, the other three being Consumer Products, Media Networks, and Studio Entertainment. To my consideration, Disney made no financial investment in Japan because it was the first theme park of Disney outside of the United States.
Disney was not sure about that, whether their theme park could do well in abroad or not. Disney knew that very well, it was a serious gamble to place their theme park in Japan. So they made no financial investment in Japan, rather than Disney provided master planning, design, manufacturing and training services during construction of theme park in Japan and also gave consulting services after completion of the facility. On the other hand Disney made financial investment of $140 million in France, and then one of over $300 million in Hong Kong.
This happens because they saw that Disney theme park in Japan was doing so well and they also find the potential of making profit through abroad investment. Also they were surprised by how the Japanese enjoyed the every aspect of Disney even accepting English as the language and American food throughout the theme park. So they invested in the theme parks of France and Hong Kong to earn huge profit as well as to gain reputation internationally. Q-3) What factors in the external environment have contributed to Disney’s success, failure, and adjustments in foreign theme park operations?
Ans: The Walt Disney Company is the world’s largest amusement park operator. Disney operates seven of the world’s ten most attended amusement parks and five theme parks outside the United States. The Parks and Resorts division was founded in 1971 as Walt Disney Attractions when Disney's second theme park, the Magic Kingdom at the Walt Disney World Resort in Florida, opened, joining the original Disneyland in California. There are some factors in the external environment that have contributed to Disney’s success, failure, and adjustments in foreign theme park operations.
Factors in the external environment that have contributed to Disney’s success: ? They gain success for focusing into different kinds of region and intellectual strategy ? Abroad government contribution ?Contribution of a Saudi Arabian investor ?They gain success for their master planning ?Design ?Manufacturing and training services ?Consulting services ?Match up with the different culture ?They gain success for their different innovative ideas and products Factors in the external environment that have contributed to Disney’s failure: ?
French people are more loyal to their culture and they thought that Disney theme park would destroy French culture. ?Lacking in observing different cultural people. ?Failure in adjusting with other countries social norms. ?Failed because to visit in Disney theme park is not affordable for all. Factors in the external environment that have contributed to Disney’s adjustments: ?Market research in the mainland is a factor of external environment that have contributed to Disney’s strategy adjustments. ?Adjustment with different culture and environment. ?They have to adjust their strategy of business.
Q-4) Should Disney set up a park in Shanghai? If so, what types of operating adjustments might it make there? Ans: To my consideration, Disney should set up a theme park Shanghai, because Shanghai is one of the fast growing cities with a lot of opportunities of trade, commerce and tourism. China is one of the most dynamic, exciting and important countries in the world and theme park in Shanghai will mark a very significant milestone for Walt Disney Co in mainland China. China has the biggest population in the world: so Disney can capture huge profit by establishing a theme park in Shanghai.
Another thing is that China’s one child per family policy increased family disposable incomes and made parents reluctant to deny anything to their child, such as a visit to a theme park. Disney should make some operating adjustment in the theme park of Shanghai: ? Disney could create own transportation facility for the customers or tourists. ?Disney could establish hotels for tourists to stay. ?Disney could offer different packages like family package, friends package, picnic package etc. ?It could bribing competitive advantage in its business strategy, products and services. ?Disney could different culture and environment.