The not so wonderful world of eurodisney summary

Case 2-1 The Not-So-Wonderful World of EuroDisney Instructions Prepare a written response to the Questions presented at the conclusion of Case 2 -1. Your written analysis should be three to five double-spaced, typed pages in length. The case can be found in the attachment. Case Evaluation Criteria Level 3 Level 2 Level 1 Communication 15 points 12 points 8 points Excellent communication Communication is generally clear Communication needs improvement 25 points 20 points 12 points Unique and insightful responses to case questions Adequate responses to case questions Insufficient responses to case questions Insight /15 /25 PART S IX cases 2 THE CULTURAL ENVIRONMENT OF GLOBAL MARKETING OUTL I N E OF CA SE S 2-1 The Not-So-Wonderful World of EuroDisney—Things Are Better Now at Disneyland Resort Paris 2-2 Cultural Norms, Fair & Lovely, and Advertising 2-3 Starnes-Brenner Machine Tool Company: To Bribe or Not to Bribe? 2-4 Ethics and Airbus 2-5 Coping with Corruption in Trading with Vietnam 2-6 When International Buyers and Sellers Disagree 2-7 McDonald’s and Obesity 2-8 Ultrasound Machines, India, China, and a Skewed Sex Ratio 2-9 Coping with Piracy in China cat42162_case2_01-031.indd 1 10/21/15 11:12 AM CASE 2-1 The Not-So-Wonderful World of EuroDisney*—Things Are Better Now at Disneyland Resort Paris BONJOUR, MICKEY! In April 1992, EuroDisney SCA opened its doors to European visitors. Located by the river Marne some 20 miles east of Paris, it was designed to be the biggest and most lavish theme park that Walt Disney Company (Disney) had built to date—bigger than Disneyland in Anaheim, California; Disneyworld in Orlando, Florida; and Tokyo Disneyland in Japan. Much to Disney management’s surprise, Europeans failed to “go goofy” over Mickey, unlike their Japanese counterparts. Between 1990 and early 1992, some 14 million people had visited Tokyo Disneyland, with three-quarters being repeat visitors. A family of four staying overnight at a nearby hotel would easily spend $600 on a visit to the park. In contrast, at EuroDisney, families were reluctant to spend the $280 a day needed to enjoy the attractions of the park, including les hamburgers and les milkshakes. Staying overnight was out of the question for many because hotel rooms were so high priced. For example, prices ranged from $110 to $380 a night at the Newport Bay Club, the largest of EuroDisney’s six new hotels and one of the biggest in Europe. In comparison, a room in a top hotel in Paris cost between $340 and $380 a night. Financial losses became so massive at EuroDisney that the president had to structure a rescue package to put EuroDisney back on firm financial ground. Many French bankers questioned the initial financing, but the Disney response was that their views reflected the cautious, Old World thinking of Europeans who did not understand U.S.-style free market financing. After some acrimonious dealings with French banks, a two-year financial plan was negotiated. Disney management rapidly revised its marketing plan and introduced strategic and tactical changes in the hope of “doing it right” this time. A Real Estate Dream Come True The Paris location was chosen over 200 other potential sites stretching from Portugal through Spain, France, Italy, and into Greece. Spain thought it had the strongest bid based on its yearlong, temperate, and sunny Mediterranean climate, but insufficient acreage of land was available for development around Barcelona. In the end, the French government’s generous incentives, ­together with impressive data on regional demographics, swayed Disney management to choose the Paris location. It was calculated that some 310 million people in Europe live within two hours’ air travel of EuroDisney, and 17 million could reach the park within two hours by car—better demographics than at any other Disney site. Pessimistic talk about the dismal winter weather of northern France was countered with references to the success of Tokyo Disneyland, where resolute visitors brave cold winds and snow to enjoy their piece of Americana. Furthermore, it was argued, Paris is Europe’s most-popular city destination among tourists of all nationalities. Spills and Thrills Disney had projected that the new theme park would attract 11 million visitors and generate over $100 million in operating earnings during the first year of operation.