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DISNEY IN FRANCE • Anitti.S • Rakesh Menon • Uma.M
• Company Name: Walt Disney• Business Line: Amusement/Theme Parks• Opening: In 1955, 80-acre theme park in California, US• Theme Parks: US (California & Florida), Tokyo and France.
• 1955 – Disneyland, California• 1971 - Walt Disney World Resort• 1983 - Tokyo Disneyland,Urayasu, Japan.• 1988 - Construction on Euro Disney Resort begins.• 1992 - Euro Disneyland opening. A€3.34b investment• 1992 - Euro Disneyland, Marne-la-Vallée
GoalsTo become the number one in Europe• To become a famous vacation destination• To impose the American entertainment• style: “bigness and extravagance”
The Case• Disney Chose France over 200 other locations for setting up the theme park – 17 million Europeans live 2 hour drive away – Another 310 million could fly to the place – $ 1 Billion subsidies for 30,000 jobs
Issues from the beginningFrench Intellectuals quoted: “Cultural Chernobyl”• “New Beachhead of American Imperialism”• “Terrifying step towards world homogenization”• “It symbolizes transformation of craft into industry”
Errors• No alcohol in the park• Wrong assumption in considering Friday a busy day but in actual it was Monday• No breakfast facilities (350 serving seats for around 2500 people)• Instead of French breakfast of croissants and coffee people wanted Bacon and egg• Lunch timing of 12.30 was a problem
• Cultural Minister Boycotting• Farmers drove their tractors in front of the gate and blocked it• €63 million net loss in initial two years
• With cast members: Have a nice day mentality – Disney Smile-Disney Look• All American look• Size of earrings• size of fingernails; nail polish restrictions• No tolerance for facial hair• Repercussions: 1000 employees left due to Americanization of services.
Questions?What assumptions did Disney make about the tastes and preferences of Frenchconsumers? Which of these assumptions were correct? Which were not?
The Problems Management Hubris Cultural Differences
• Size of parks: Majorly small parks sharing revenues.• Theme: Lacked coherent theme for the parks.• Competition: Failure to Compete with other options of entertainment.• Highly inflated projections made in terms of visitors, occupancy of hotels• Wrong assumption in considering Friday a busy day but in actual it was Monday• European approach to vacation time• Disney is not a holiday destination
• Cultural Imperialism: Disney failed to recognize the existence of cultural differences in Europe• Impacts: Made financial projections based on American vacationing habits Served American foods rather than local foods Refused to sell cigarettes/alcohol Required employees to act in ways that conflicted with their social customs
How might Disney have had a more favourable initial experience in France? What steps might it have taken to reducethe mistakes associated with the launch of Euro-Disney?
Later What Happened?• 1994 - Disneyland Paris• 1994 & 2005 - Financial restructuration. New strategy• Sensible to the French market• Better waiting line management• Reduce cost price to beat competitors by 1 third• Strengthen experience marketing-Disney an “Imaginary Place, a culture without sin”
In retrospect, was France the best choice for the location of Euro-Disney?