Walt Disney Report

Prepared for: 3042MKT Marketing Globally

Prepared by: Nakisha Holdsworth
Student Number: S2947290
Date: 31st October 2016
Word Count: 2,857
Case Study: Walt Disney
Executive Summary

This report provides an analysis and evaluation of Disneys ventures in

France and Hong Kong and, will critically evaluate the concerns and solutions
to issues currently encountered. It also outlines a detailed strategic analysis of
the last two ventures.

Through the academic and industry literature reviewed about Disneys

ventures it was found that there were many mistakes made by Disney, the
main being Disney wasnt culturally sensitive towards France, which lead to
the downfall of its theme park there. Disney rectified this problem with its
venture in Hong Kong successfully.

A recommended theoretical approach, the Self-reference Criterion and

Perception theory, has been identified to help solve the current problem
Disney has which goes through the 4 steps associated comparing and
contrasting Disney and its French hosts.

In regards to the multiple case questions presented, they will be explained in

depth, with focus on the cultural elements seen in Paris, Hong Kong and a
discussion of a possible venture into Dubai and its associated concerns. The
Implementation of Marketing Strategies will address future concerns using a
Segmentation, Targeting and Positioning strategic approach as well as
conducting a strength, weakness, opportunity and threat analysis.

Regardless of the concerns that Disney currently has, it has been shown that
if Disney correctly implement the above marketing theories and strategies
they will succeed in not only their current ventures in France and Hong Kong
but any future global ventures that are under taken.

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Table of Contents

Executive Summary.........................................................................................2
1.0 Introduction................................................................................................4
2.0 Situational Background............................................................................4
4.0 Responses to case study Questions.......................................................6
4.1.1 Cultural Elements.......................................................................................6
4.2 What did Disney learn from its mistakes in Paris?......................................7
4.2.1 Euro Disneys Turn around.........................................................................7
4.3 How did Disney embrace Chinese culture with its Hong Kong venture?...7
4.3.1 Disneys Hong Kong venture......................................................................7
4.4 What cultural issues would arise if Disney chose Dubai for its next theme
park?...................................................................................................................... 8
4.4.1 Cultural implications for Disney theme park in Dubai.................................8
5.0 Implementation of Marketing Strategies to address future concerns. 9
6.0 Conclusion...............................................................................................10
List of References..........................................................................................11

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1.0 Introduction

The purpose of this paper is to review the case study into the globalisation of
Disneyland in both France and Hong Kong, provide background and insight
into the early failure of the European venture by The Walt Disney Company
(Walt Disney Co. or Disney). This venture into France in 1992 assisted in the
correct cultural processes being followed in 1998 when Walt Disney Co.
chose to open their next resort in Hong Kong (Mills et al.,1994; Matusitz,
2010). The Walt Disney Co. was originally started by Mr Walt Disney in 1923
under the name of the Disney brothers cartoon studio and came from humble
beginnings, its now a world renowned international entertainment and media
enterprise which is known for family orientated content and characters.
Disneys global influence varies from broadcast media including TV and radio,
theme parks and resorts, studio entertainment and lastly Disney branded
products and media including toys and books (The Walt Disney Company,
n.d).

2.0 Situational Background

The key issue with the Walt Disney Co. venture into France, originally named
Euro Disneyland, was that the marketing strategy had a dual extension of
their current business, not an adoption based on the new environment the
park and resort would be based in.

Extending the successful business model and company policies that were in
use in the United States (US) failed in part due to the fact that no
consideration was made about the host country, France, being a culturally
fragile country particularly when it comes to languages and sensitivity towards
the American way of life. This venture initially turned out to be a failure, with a
first season turnout of 50 000 instead of a projected 500 000 (Matusitz, 2010).

In order to keep the European venture alive, vast changes were made to
policy in order to fix the biggest problems, which will be discussed in further
detail as part of the theoretical approach to the disaster that nearly went out of
business (Mills et al., 1994).

The lessons learnt in France were significant to the Disney venture in Hong
Kong, detailed research went into the cultural requirements of the host nation
and great lengths were taken to ensure that from the very start Disney was
doing the right things in order to bring in their targeted markets of Locals,
Southern Chinese nationals and wider Asian tourists (Matusitz, 2011).

3.0 Theoretical approaches addressing the major concerns

identified

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The major problems identified by Disney are resolvable through the Self-
Reference Criterion and Perception theory. If applied appropriately the insight
can be vital to the success of Disneys ventures. The Criterion was found to
suit Disney perfectly as it analysed the situation and addressed the major
problems that they would encounter in global ventures (Keegan et al., 2015;
Malhotra et al., 1996).

Step 1.
Disney believed that there was a great demand for American Culture, not only
Disney but also other companies had great success in expanding their
products globally. Disney has great success in their theme parks and is well
known for their successful management style. This proof of demand was
shown in Tokyo when Disneyland opened there; it is now the most visited
theme park in the world (Raz, 2000). As per the American policies, there are
strict codes of conduct including the Look Book that defines what staff
members (known as cast members) can wear including limitations on the
wearing of rings, make up, stockings other than transparent coloured for
women as well as there being no beards for men (Adekola & Sergi, 2007;
Forman, 1998; Matusitz, 2010). Policy also dictated that staff members must
smile within 60 seconds of a customer entering the park and lastly there was
the well-known Disney rule of no alcohol on site, which is taken very seriously
to promote a family friendly environment (Palmer et al., 2007).

Step 2.
The French hosts to Euro Disneyland, and wider Europe saw the
development as a transplant of American culture into one of the intellectual
centres of Europe (Palmer et al., 2007). The French concept of Mickey
Mouse was a much more colorful character than the American, and the
American Mickey Mouse was seen as plain and boring, a threat to the intellect
of French children (Matusitz, 2010). Lunch is had at exactly 12:30PM each
day with a wine or beer as a habituated part of life; The French workers were
accustomed to working certain hours and having different fashion styles to
Americans and the fake castles in the heart of Europe were seen as a sign of
consumerism at its worst (Matusitz, 2010; Forman, 1998).

Step 3.
Through analysis done in step one and step two it was found that there are
significant differences between the previous Disney theme parks in the US
and Japan compared with France and the lack of regard for the new venture
in light of these contrasting views and cultures was a near fatal mistake for
Euro Disneyland.

Step 4.

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Subtle differences by changing the park name to Paris Disneyland, having a
French management team and insight into the local requirements of
consumers would bring the community on board. Cheaper cost of entry and
food, Relaxation of staff rules and promotion of local events would increase
morale and the allowance of alcohol in this context is a must for Disney. If the
park is adapted to meet the cultural requirements and dull the tainted opinion
of the park due to the American influence from Disney there is opportunity to
bring more visitors per year as originally projected.

4.0 Responses to case study Questions

4.1 Discuss the elements of culture that have been addressed in

this case study
4.1.1 Cultural Elements

The case study shows that the core cultural elements, both physical and
abstract, were seen due to issues in France with local attitudes, values and
perceptions and the overly cautious cultural awareness of Disney in Hong
Kong mostly focused on the local and regional beliefs, perceptions clothing,
aesthetics and colour. These two locations will be discussed further to break
down what the elements of culture really meant in each context.

In the case study, it was mentioned that the success of Disneyland in Japan
was in stark contrast to the failed western culture in France, it should be
highlighted that this is in part due to the cultural elements in Japan being pro
American values and perceptions thus causing the foods and products to be
in very high demand bringing on more spending per person per visit there
(Toyoda, 2014).

In France, the Disney venture was seen as an American imperialist challenge

to local fairy tales and the media made a point of saying that one day French
folk lore may be replaced with American cartoon characters (Forman, 1998).
This hype played on the values and perceptions of the French people towards
the park.

In Hong Kong, weary from the issues encountered in France, Disney ensured
that from the very start of their venture that they had the local and regional
people on side. In an aim to ensure success, Disney encouraged a positive
influence and attitude around the project by partnering with local government
as well as there being a massive belief, spiritual and aesthetic focus seen
through rituals, adaption and application of good Feng Shui, changing food
and souvenirs on offer and lastly the use of colours and numbers as further
highlighted in section 4.3.

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4.2 What did Disney learn from its mistakes in Paris?
4.2.1 Euro Disneys Turn around

There were a number of mistakes that Disney made in relation to its Paris
Venture. The main focus is on how they did not understand the cultural
differences between the United States and Europe; In particular, Disney
wasnt culturally sensitive enough towards the French people and their way of
life.

They learnt that the venture required improved analysis, evaluation and later
adapted French cultural components into the theme park. This was seen as
Disney started with an ethnocentric management orientation eventually
learning that they had to have a polycentric orientation to have success in
France (Adekola & Sergi, 2007). As they had previous success with the
American and Japanese Disney theme parks, they got too comfortable and
lost sight that not every customer is the same. This showed that Disney had a
false sense of security about the influence and power of its product. Although
they under preformed in Disney Paris, Disney seemed to have taken on board
their mistakes and used it as a lesson for the Hong Kong venture (Spencer,
1995).

Whilst Disney had a lot of trouble on their venture into Paris they are not the
only American company that have had trouble venturing into France, it was
found that coca cola had encountered similar issues in 1999 and had massive
setbacks. This issue was amplified for Disney as they were not just selling a
product, but had a physical footprint in France (Taylor, 2000).

4.3 How did Disney embrace Chinese culture with its Hong Kong
venture?
4.3.1 Disneys Hong Kong venture

Disney made lots of adaptations (Global Localization) and alterations in

accordance to the Chinese culture including what they consider taboo and
their superstitious beliefs. Having the Hong Kong government involved meant
that local people on the ground were able to advise Disney and ensure that
they were in touch with regional issues. Disney also made sure the
employees were trilingual and all signage and audio messages had the two
dialects of Chinese (Matusitz, 2011).

Focusing on the aesthetics, specifically the numbers and colours with great
importance to the local beliefs about what the Chinese believed they meant.
Examples of this are that there was no level four as that was considered
unlucky and the number eight was used prolifically as it was considered lucky.
The colour red was used often as it was considered very lucky.

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As the Chinese are very superstitious they built the park in accordance to the
principals of Feng Shui, as it would mean that they would be more accepted
by the Chinese. A geomancer was brought in to ensure everything was done
to promote good Feng Shui, including the physical efforts of rotating the entry
several degrees, designating no fire zones and placing boulders as part of a
connection to earth. Incense burning was done at the completion of each
building in order to keep superstition at bay in line with local beliefs and
values (Matusitz, 2011). Disney also modified their merchandise as there was
unique cultural requirements such not having green hats as it meant that the
partner of the person wearing it had committed adultery, clocks were not sold
due to being a sign of a coming funeral. They also catered for dietary
preferences, which meant they had a combination of Chinese and western
food available as learnt from the mistaken interruption to the European eating
rituals.

4.4 What cultural issues would arise if Disney chose Dubai for its
next theme park?
4.4.1 Cultural implications for Disney theme park in Dubai

For Disney to expand into Dubai there are a number of issues that would
arise, as not only is Dubai vastly different from their previous ventures but it
also has a lot of cultural aspects.

Religion is a very big issue as the vast population is made of Arab Muslims,
which would mean they would have to cater to the specific needs being prayer
rooms and dietary preferences. Although the vast of the population is Muslim
(17%) and around Dubai they have strict policies on clothes but in theme
parks it is allowed to have what is considered revealing clothing for example,
a bikini, as they knew they had to be accommodating to foreigners (Goby &
Nickerson, 2013; Government of Dubai, n.d)

Disney wouldnt target locals as Dubai is a man-made tourist city. This would
mean that the primary target market would be the tourist population, which
make up 83% of residents. The majority of tourists are European (Goby &
Nickerson, 2013). There would be focus on the management and the
employees as most of Dubai are migrants, which would mean depending on
who Disney employ it could cost a lot or very little of their total profit
(Randeree, 2014). Another consideration would be Dubais weather as it is
very hot and they have sunny days the majority of the year. This is a big factor
as Disney may need to add indoor or water themed attractions to help patrons
with the heat (Henderson, 2006).

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5.0 Implementation of Marketing Strategies to address future
concerns

It has been found that Disney needs to use a product and branding strategy of
dual adaptation to further their success. Disney had first went with the dual
extension method in their French Venture as previously done in Japan which
they soon realised led to their downfall within Europe. On the other hand in
their venture into Hong Kong they used adaption in relation to every aspect of
the theme park down to the location of the buildings and the promotion of the
park. This is what Disney always has to apply and should always use when
venturing into new markets.

Recognition of the contribution of each function within the Segmentation,

Targeting and Positioning strategic approach (STP) as well as a strength,
weakness, opportunity and threat analysis will describe the customers
response to any new venture and allow for allocation of vital resources
towards the correct target markets and the corporate vision for any further
global ventures (Pyo, 2015; Keegan et al., 2015).

In regards to segmentation, the specific variables that must be considered for

the Walt Disney Co. are dichotomous predictor variables and will be able to
provide guidance on which to base pricing of entry and food as well as
ensuring that there is enough offered by the theme park to bring in and
entertain three key age groups being parents, teenagers and children as for
each day spent in the hotels and park there is more money to be made from
targeted consumers. The last consideration in regards to segmentation is
ensuring that local food and customs are taken in to account and applied
within the park through baseline segmentation, as the typical American style
food and eating habits may not be successful in the host country (Pyo, 2015).

When selecting a target market there must be a clear vision about the current
environment including the product market and what a new product could do in
the market to better fit the needs and wants of the previously identified
consumer segments. Through doing this, Disney will be defining and actioning
the enabling conditions that make a potential site favourable as a new
venture. In regards to theme parks, a concentrated global marketing strategy
should be used when assessing the feasibility of a target. Accessibility, local
competition, growth potential and probability of repeat visits can all be factors
in placement of a theme park as loyalty to the more established local theme
parks can be a cause of less visitors from the regional area, as has been seen
with Ocean world in Hong Kong (Matusitz, 2011; Pyo, 2015).

Positioning is an essential factor in the choice of the next host country. A

successful positioning strategy must leverage the target segments adapting
and marketing towards that market. It should be noted there is an extremely
high market risk in the fact that Disney may be seen a large US corporation
moving in to replace and destroy local culture which be cause for rebellion
against the brand (Forman, 1998).

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While the brand value is an advantage this may work against Disney as
foreign consumer culture may not be received well if local consumer culture
position of the product is not modified for the target market as seen in France
with the clash of cultures and Hong Kong with the relative misunderstanding
Disney fairy tales and what a theme park actually is (Forman, 1998; Matusitz,
2011; Pyo, 2015).

6.0 Conclusion

Through analysis it has been shown that although Disney didnt do so well in
their recent ventures there is still plenty of room for improvement and
expansion into other markets. If Disney has the right marketing strategies and
theories in place, Disney will succeed. Within the case study questions
presented it explained in depth the cultural elements seen in Paris, Hong
Kong and discussed a possible venture into Dubai.

Recommendations have been made in relation to what strategies and theories

Disney should use in future. It was advised that Disney use the Self-
Reference Criterion and Perception theory to solve the current problems that
they have. For any future concerns that Disney may have they are to
implement product and branding strategy of dual adaptation as well as
Segmentation, Targeting and Positioning strategic approach and in this
approach, they are to also analyse the strength, weakness, opportunity and
threats in the target market to strengthen the STP strategy.

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List of References
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Henderson, J. C. (2006). Tourism in Dubai: Overcoming barriers to destination

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