Case Study: Euro Disney
Case Study: Euro Disney
As I read the case study of Disney’s Euro Disney park in France, one of the first things that came to mind was how little research had been made on how Europeans act and think in general compared to the rest of the world. As stated on page 143, Disney had not correctly calculated the success rate of Tokyo Disneyland park, therefor, they did not take ownership in the park, nor did they make the park very big. The biggest mistake that Disney made, however, according to the reading, was that they took on too much debt in the development and opening of the park. As I have lived in Europe for many years, and know how Europeans in general think, companies that want to open any type of activity here need to think as a European. They will do many things to save money such as bringing their own food and drink as stated on page 144. Europeans have a long history of frugality when it comes to times of recession, which was the case in Europe when they park was being planned and built.
Disney did not plan on the fact that even though the attendance was high, the visitors did not spend as much money on things such as souvenirs, hotel stays, and restaurants also due to the high prices. Instead of playing it safe and adopting the “penetration strategy” which means lowering prices in order to assure people buying more goods, Disney used the “skimming strategy” by assuming that sales would not be affected by pricing (p. 145). There were many external mistakes that may or may not have been preventable such as the real estate problem which prevented Disney from selling the hotels to outside investors, but one good thing that did help in the end was the construction of a high-speed train station close to the park entrance, and this allowed the hotels to gain in attendance, and more people were able to come from England once the Chunnel was finished.
As far as internal mistakes, had Disney done more research, they would have realized that culture plays a huge part in Europe, and serving alcohol on the premises is important. McDonalds realized this when they opened their restaurants in each European country, adjusting their menu to offer food and drinks according to each country’s tastes the usual McDonalds fanfare. Disney changed this, along with making cheaper places to eat in the park. They had to adjust the availability of breakfast since they did not plan for the great amount of people eating breakfast. Another mistake that was later fixed was the scheduling. They adjusted according to the high and low peaks of the week and seasons. They also had to build more facilities for the bus drivers, which is vital if you want bus drivers to be willing to drive tourists to the park (p. 148).
In the end, many things had to be changed in order to make sure that they were successful in the European community. They got rid of the high priced items and replaced them with what people wanted such as Disney souvenirs. They lowered admission prices during the off season. They adjusted staffing to meet needs and made the employees more efficient at customer service. One thing that must be taken into consideration in Europe is the fact that it is not just one country like America, or Japan. There are many countries on one continent, each with their own language and culture.
Wherever one goes in Europe, at least in the tourist spots, there are signs in at least four to five languages, if not more. One must offer food according to the cultural tastes besides the usual hamburger and hot dog. One of the most important factors to take into consideration, and I believe this to be true anywhere, is economy and recession. One cannot expect people going through a recession to pay high prices, no matter who one thinks they are or the name one carries.
Management Mistakes and Successes, 10th Edition by Hartley, R. “Euro Disney: Bungling a Successful Format” Copyright 2011 by John Wiley & Sons, Inc. Reprinted by permission of John Wiley & Sons, Inc. via the Copyright Clearance Center.