Mktg 357 - Prof. Kligman
Group 4
Wendy Esler
Mike Lyden
Steve Beck
Christy Clark
Claire Kelly
Disneyland Paris

            EuroDisney was opened in April of 1992, near the river Marne, twenty miles east of Paris.  It is the biggest and most lavish of any Disney location.  The total cost to build the park is estimated at US$2.37 billion.  EuroDisney is home to many expensive hotels, with rates rivaling those of even Paris’ most chic chalets.

            Due to many different circumstances which nearly lead to failure, Michael Eisner personally structured a package to reform the park in 1994.  Although Disney is a name recognized around the world, EuroDisney was almost a colossal failure.  How something like this could happen is intriguing.  There are numerous reasons for Disney’s near fatal performance, both foreseeable and unforeseeable.

            Unfortunately, EuroDisney did not take cultural dissimilarities and reference criteria into account resulting in their initial poor performance.  These factors are in essence foreseeable by extensive research or the ability of Disney advisors to remove themselves and their values from the decision making in the infrastructure of EuroDisney.  These factors and others that will be discussed further can be distinctly categorized among the international marketing ideas of SRC, self-reference criteria, and ethnocentrism.       

            To correctly evaluate the problems that Disney faced in the opening of this European amusement park an overview ethnocentrism and SRC is essential.  Ethnocentrism and Self-Reference Criteria have common characteristics that will make it easier to discuss the factors contributing to the failures suffered by EuroDisney.  Ethnocentrism, which can influence an individuals understanding and evaluation of a situation, is a person’s notion that one’s own culture or company knows how to do things the best.  This mainly occurs because of prior success in similar situations, as the case with Disney.  In comparison SRC is an unconscious reference to one’s own values, experiences and knowledge as a basis for making certain decisions.  Both of these international marketing obstacles showed to be larger obstacles than Disney advisors initially had suspected to be influential in the prosperity of EuroDisney.

            By the manner in which they open EuroDisney, Disney accurately demonstrates the sightlessness with which a company that believes it dominates markets worldwide can so poorly plan such an enormous venture.  Their monopolies constructed in the United States and other countries across the world, have proven to be a crippling handicap.  When going into Europe, their ethnocentricity blinded them to important issues, both large and small.   This may be the primary underlying factor to the poor performance of EuroDisney. 

            The feeling that dominance and success in past operations lifted the marketing team of advisors on a pedestal that became difficult to swivel down for different situations.  The SRC of Disney, as well, played a large factor in their overall performance.  Applying the definition to the case study one can basically recognize this international marketing idea.  The general European attitude toward America, along with European values and traditions, ended up generating an overwhelmingly negative effect on the performance of the park.

            In reference to these factors, SRC and ethnocentrism, many of these crippling situations endured by EuroDisney could have been foreseeable and more than less controllable by either the advisors of EuroDisney or the parent company of Disney themselves.  To a large extent the mistakes that Disney had made in the past may have been the largest factor in the poor-performance of EuroDisney. Some of these mistakes included allowing other companies to build surrounding hotels and also letting others to own a park entirely resulting in Disney only being able to collect royalties. They were aggressive in avoiding these mistakes, which could have been the reason that EuroDisney became a capitalist icon in the heart of European heritage, instead of just an amusement and theme park in Europe. 

            The trial and error involved in Disneyland Paris can be looked at as a learning experience.  There was good that came out of so much bad – Disney now knows that even they need to do their homework when embarking on a new location for one of their iconic theme parks.  This concept comes in handy when planning the next Disneyland.

            The three best locations for the next Disney, and those that best suit Disney’s needs are:  Hawaii, Mexico, and Australia.  There are pros and cons for each location. 

Hawaii is optimal because of its climate.  On average, the daytime temperature is between 78 and 85 degrees Fahrenheit.  At night, there is usually only a ten degree difference.  In addition, its location is great, and it is already a very popular travel destination.  Hawaii is part of the United States, and the currency would not have to be converted. 

Some problems with using Hawaii as a location are its frequent volcanic activity, its limited space, and the fact that it is currently a destination to which many people travel to relax without children.  The park may bring in an unwanted type of vacationer. 

            Mexico has several advantages as a location for Disney.  Its climate is fair, and very similar to that of the United States.  Mexico is a very popular vacation destination, and brings in huge crowds every year.  One big advantage would be the jobs created for the populace.  Disneyland Paris created 30,000 jobs; Mexico would thrive with the addition of so many jobs.  Moreover, there is certainly enough land on which to build a theme park, and the real estate is comparatively inexpensive.  Mexicans are also strong supporters of US culture, and frequently emulate North American styles and interests.

            One disadvantage is the language barrier.  Another is the currency conversion.  The biggest problem with Mexico is the poverty.  Disney items are notoriously expensive, and in a country where poverty is prominent, many of the local citizens will not be able to afford the trip. 

Australia is a great location for Disney.  One advantage is that its seasons are opposite those we experience in the United States.  If patrons want to visit Disney in the winter, but don’t want to visit in the cold weather, they can go to Australia.  Australia is also a central location for an entire untapped region of the world that currently has no Disney attractions.

            There would be a problem with the conversion of United States Dollars to Australia Dollars, however.  Land is limited, and much land is wildlife reserves.  There are several endangered species residing in Australia.  Also, Australia is indeed an island, and for those who do not live there, the only reasonable way to get there is by plane.

            A problem with any of these locations is that there are already several Disney’s around the world.  If the locations are not limited, the parks may become commonplace, and each individual Disney will not bring in much profit.

            As far as EuroDisney’s expansion within Disneyland Paris, there are many new additions.  Each has helped them to continue to be successful in the European market.  Executives started looking at what the French citizens would accept and appreciate and built the theme park based on those criteria rather than those of an American.

            Val d’ Europe International Shopping Mall opened in October 1998.  They also added the Fast Pass in April 1999.  The fast pass was a great way to cut down on the time visitors were spending waiting in long lines.  Visitors would take their day pass and swipe it at the fast pass station.  Then they would receive a ticket that would give them an hour time span in which to return to ride the ride of their choice.

            The most recent addition to Disneyland Paris is Walt Disney Studios which just opened in March 2002.  Walt Disney Studios offers a backstage look at the rich European history of film, animation and TV.  Visitors are also able participate in hands-on activities as well as learn behind the scenes secrets to animation.  At the same time as Walt Disney Studios, seven themed hotels, with new stores to shop in, were opened. 

            Hotel rates are now up to an 86% capacity compared to the 60% capacity in 1994.  One other important factor is the French now make up 40% of the visitors that go to Disneyland Paris.  When they first opened their doors the French were completely turned off by the theme park and didn’t go to the park.  The United Kingdom makes up 18% and Belgium/Luxemburg make up 16%.  So almost 75% of visitors are from Europe which is what was expected from the beginning.

            EuroDisney is now profitable, and will continue to be.  The lessons learned by the near absolute failure of Disney in Europe are eye-opening.  It is amazing that such a gigantic multi-national conglomerate like Disney can make so many mistakes when breaking new ground.  The fact that the idea of Disneyland Paris almost collapsed is something that is commands pause.  Research is an important part of any business movement.  If Disney had done more research before barging into the situation, perhaps they could have avoided so much bad publicity and such capital loss.