Despite a long story of success in the past, Euro Disney failed to anticipate demand accurately for their services. The company failed to recognize the frugality and price consciousness of the European customers which had a direct impact on the spending Patterns of the consumers. They assumed Europeans to follow the same pattern as the Americans however this was not the case hence it suffered huge losses.
Cultural differences can lower the impact of a certain service and will lead to lower projected revenues. Euro Disney had visitors from all over Europe which spoke different languages, they shared different culture and history compared to American. It was important to integrate it into the theme park before hand. These differences adversely affected the company; alcohol wasn’t served in the park in a country where wine was a norm with food, inability to realize Europeans peak leisure days and serving them breakfast. A better analysis before hand and a president from the local environment initially would have been more familiar with the local environment would have led to increase in revenue.
It was very important to be familiar with the mindset of the people while working with those belonging to different culture in order to maintain smooth working environment. The French unlike the Americans were sensitive and touchy people. To foster good will with them one has to incorporate them in one’s decisions and discussions and not just dominate them because this will infuriate them and alienate them and their support and cooperation. The French don’t like bossy attitude coming towards them hence one should be modest in dealing with them.
The Tokyo Disney turned out to be a great success, way more than the expectations. The number of visitors was high with large revues and profits. Japanese were adaptable and flexible lot they welcomed American culture in the theme park from food to entertainment whereas the Europeans were reluctant to adopt the American style initially due to which Disney had to face many problems of cultural diversity in Euro Disney.
Euro Disney was located at an ideal place as it was close to Paris, Paris being Europe’s largest tourist destination. The problem was not with the location but with other factors such as skimming pricing strategy for the price sensitive Europeans proved to be a failure, recession in the economy, failure to anticipate demand and cultural differences and apart from these operational inefficiencies and mismanagement. Location would not have made these factors better hence it would not have done better if located anywhere outside Paris too.
Mickey Mouse is one of the greatest characters of Walt Disney and has a long history of success with the company. It is an icon of American culture; Mickey Mouse has always been one of the attractions at the Disney theme park. Unlike other American theme parks Euro Disney was criticized among the French for being too American and caused a clash, resentment and low turnover from them as they believed keeping French culture aside American culture was being imposed on them. Hence in order to counter the ethnocentric views Disney had to incorporate the French culture into the American Disney image for the liking of the Europeans.
In order to make an impact on the Europeans, Disney was required to make a campaign that would have focused on French names and terminology, such as names of the rides and the restaurant menus, the French wanted their culture opposed to the American as it did not tune in with their own. Similarly the European Walt Disney studios should focus on French movies and people as a means of entertainment. It should be positioned as a theme park that as a perfect vacation resort and not the American resort in particular. This positioning can be done by engaging tourist guides, bus drivers and travel agents into the marketing campaign and providing them incentives to promote the promotional campaign of the company.
Though Disney entered Europe with high hopes and confidence however it had to face losses due to the many mistakes it made in planning and launching the theme park. One such mistake was the price skimming strategy, Disney expected the demand for its park to be inelastic and hence it could have gained high revenues. However, raising admission prices would have added fuel to the situation because the turnover from the French people was already low, their low spending patterns, frugality, and economic recession would have discouraged people from visiting the park as prices were already considered to be very high and would have lead to further losses for Euro Disney.
Jiffy Notes. (n.d.). EURO DISNEY S.C.A. Retrieved May 21, 2010, from JiffyNotes.com: http://www.jiffynotes.com/a_study_guides/book_notes_add/emmc_0001_0001_0/emmc_0001_0001_0_00102.html