Euro Disney Case Study Marketing Examples
Why Eurodisney Failed
Projects / Academic / Why Eurodisney Failed
The confidence of Disney was partly based on the number of Europeans visiting US Disney parks. Europeans would be visiting the US parks because they were in America however, not visiting America specifically to go to the parks (These figure hence do not accurately reflect the popularity of Disney theme parks in Europe). The US Disney parks are seen as part of the American experience not as a complete holiday destination as they are more in America.
All attendance predictions are based on parks in the US and Japan, which is also quite americanised. All calculations treated Europe as a general mass of people rather than many individual countries.
The strategy was very greedy in buying all the surrounding land so no one else could benefit from the project. This is not going to promote any local support and isolates the project from and other business support. The scale of the investment also isolated them more in the case of a failure.
The idea was to market the Disney as a complete holiday encouraging people to stay in the hotels and eat all meals in the park.
The location of the park first defied this. Since the travel time to Paris was 35 minutes and the gate hotel in Euro Disney cost as much as the best hotel in Paris, many people may prefer to stay overnight in the capital city.
The proximity to Paris also puts it in competition regarding the tourist industry. People passing through the area may decide to take the more traditional option and visit the romantic Paris instead. Paris may also lose out from the detraction of local tourist focus causing some businesses in Paris to oppose the project.
Secondly the attention to the wrong details. How many Europeans are going to notice leather wallpaper when they cant get their usual breakfast or wine with meals. This seems to show that Disney were acting on an American view of Europe rather than a native view, which could identify the important cultural differences.
Also the paranoia about offending 'sophisticated' European tastes meant that Disney forgot that their parks would always be seen as part of American culture. Most people enjoy the parks for this reason and would prefer a hamburger to a large lengthy meal, which would be normal everyday at home.
The executive saying, "We were told Europeans donâ??t take breakfast..." seems to show that the analysis of the European market was very general and the managers were too confident in their success to research the small details about European cultures.
In planning Euro Disney there do not seem to have been many contingency plans established. The attitude towards customer habits was very complacent, assuming that there would be so many customers every day, each staying an average number of nights spending an average amount of money. In America this may be more the case since there is a well-established theme park culture. Many people will avoid visiting during peak holiday times, spreading out attendance figures over a year for example. The European market proved to be a lot more volatile however, with great peaks and valleys in attendance. One would expect large crowds at weekends and holidays. In planning, Disney were more interested in the moneymaking ventures than the fundamental details such as providing enough restrooms for coach drivers.
Most Europeans are not accustomed to stating overnight in a theme park so the heavy investment in hotels seems a big risk.
Disney was introducing theme parks to people only previously interested in fun fairs. People would hence not be used to completely living in the amusement environment. The scale of Euro Disney would also be associated with high prices and a commercial atmosphere.
In marketing the park Europe was treated as one country when it has a larger range of language and culture than the US or Japan. While the attempt was to give the park a European flavour, the advertising campaign was typically American.
Most advertising was aimed at children while the adults make the final decision on whether to go or not. In America this may work because Disney theme parks are long established and adults associate the whole experience with childhood memories. In Europe however theme parks are un-established so more marketing effort is required to convince people that Euro Disney will surpass everyoneâ??s expectations.
On opening the park, Disney continue to display over-confidence. The prices reflected their expectation for demand. The Media also appear to have been treated as if the scale of the investment would sell the park. By not giving access to the Disney executives it seems as if they have better things to do and the success of Euro Disney is guaranteed.
The Management seem to be overpowered by their reputation for success with no scepticism about the European market.
The opposition to Euro Disney was disregarded despite the fact that mainstream newspapers seemed support the protest. Disney ignored the description of Euro Disney as a cultural abomination, which could have highlighted the need for further cultural integration. The attitude of Disney management is confidently dismissive making them appear out of touch with the cultural differences.
The early change in managing director shows Disneyâ??s expectations for success. Robert Fitzpatrick was said to know Europe well, which sounds like a general knowledge rather than that acquired from being native to the country and living there. Choosing Fitzpatrick may have been an initial bad choice but to replace him after only a year shows Disney as being impatient and throwing away the experience Fitzpatrick has gained.
Philippe Bourguignon tells that some of the best ideas on park improvement came from staff members. This suggests that more could have been done to survey visitorâ??s opinions of the Park after opening. There is a need for management to treat the Europe as something knew about which they are constantly learning, rather than as a market they can dominate at will.
There were reasons for failure due to marketing and administration decisions made before and after the launch of the park. The whole concept of trying to sell an American product to Europe, while trying to adapt some features of the park to suit a wide variety of cultural tastes, doomed the project. Overconfidence in the formerly foolproof Disney formula meant that in planning the park not much attention was paid to many important details. In this sense the administrative errors in the project planning were the main reasons for failure. The inappropriate marketing of Euro Disney contributed greatly to the poor attendance but ultimately the park itself was not going to make the groundbreaking impression needed to create a new market.
EURO DISNEYLAND CASE ANALYSIS
Euro Disney, nowadays Disneyland Paris, is a holiday and recreation resort located in Mane-la-Valle, a new town close to Paris (Euro Disney, 2009). When the International offer of shares for the Euro Disneyland was issued in October 1989 the strategies for this new enterprise of the Walt Disney group were very optimistic. The financial plans for the first year of operation estimated total revenues of FF 5,482 million and a net profit after tax of FF 204 million. For the subsequent years the development was projected to be even more impressive. Just within a short time after Euro Disney was unwrapped in April 1992, it was noticeable that reality would not encounter the plans. In November 1992, the financial reports for the year ended in 30 September 1992 were published which included the first 172 opening days of Disneyland Paris. There the management had to announce a loss of FF 188 million. The second year was even worse. Although Euro Disney nearly met plans for guest attendance, they confronted a loss of FF 5,337 million whereas total turnover was FF 5,725 million. Plans for the second year of operation (1 April 1993 to 31 March 1994) predicted a turnover of FF 6,801 million and a profit of FF 359 million. (Recklies, n.d.)
Euro Disney started to have problems early, on 1980’s problems with negotiation and construction, on the 1990’s with French figures started to voice
against the park, with phrases
like “Cultural Chernobyl”
(Euro Disney, 2009) .Euro Disney also had problems in the beginning of its operations, since the first day, problems related to cultural issues and operational issues oc
curred massively, affecting directly Euro Disney’s performance and attendance.
The main objective of this report is to understand how Euro Disney had this initial failure. How it could had a better initial experience, and to provide recommendations to students and
business men don’t committee the same errors.
Hofstede's cultural dimensions theory
Hofstede's cultural dimensions theory is a framework for cross-cultural communication, developed by Geert Hofstede. It describes the effects of a society's culture on the values of its members, and how these values relate to behavior, using a structure derived from factor analysis. The theory has been widely used in several fields as a paradigm for research, particularly in cross-cultural psychology, international management, and cross-cultural communication. (Hofstede's cultural dimensions theory, n.d.)
Dimensions of national cultures
Power distance index
Individualism vs. collectivism
Uncertainty avoidance index
Masculinity vs. femininity
Long-term orientation vs. short term orientation