Case Analysis of Disney

Case Analysis of Disney

1. What factors contributed to EuroDisney's poor performance during its first year of operation? What factors contributed to Hong Kong Disney's poor performance during its first year?

The first year for EuroDisney was disastrous due to several bad decisions taken by the management as well as some external factors. The primary reason for the failure was its high cost. Hotel rooms at the park were charging rates comparable to luxurious hotels. People found it cheaper to fly to Disney World Florida and get an additional benefit of enjoying the weather. The Gulf war in 1991 also had a negative and during the same period, Europe was facing a recession.

The decision makers made several mistakes for instance they banned the consumption of wine and the number of seats available for breakfast were insufficient. The French, for some reason, did not like the American culture while Disney tried to enforce this culture. This, along with several other factors contributed to its failure in the beginning.

The world fair in Spain and the Olympics in Barcelona in 1992 attracted holiday visitors hence, EuroDisney did not have many guest visiting it that year. Almost none of its targets were met and with costs rising, they faced severe challenges ahead unless they had tried something different. In order to attract customers, they reduced their prices and introduced new rides that ultimately improved its performance.

Hong Kong Disneyland faced different issues. Firstly, people were not familiar with the characters since Disney was banned for 40 years in China. The park was small, with just a few rides compared to other Disneyland's, therefore customers were not interested. Despite these issues, it fared better since it incorporated a lot of Chinese culture.

2. To what degree do you consider that these factors were (a) foreseeable and (b) controllable by EuroDisney, Hong Kong Disney, or the parent company, Disney?

Since the cost of Disney World Florida was cheaper, customers preferred to fly to the US. This meant that prices in Paris could also be controlled. There were several other mistakes made by the management; for instance, alcohol was banned although consuming wine with meals was a French tradition. The reason for banning alcohol in the park could be justified but it was not acceptable by the French due to their tradition (Hartley, 2011).

Disney did not conduct a proper research before expanding into Paris. The reason for the poor performance ...