Question

Case 4

When Disney opened its $4.4 billion Euro Disneyland outside Paris, concerns over the park’s impact on French culture were expressed. To begin with, the French dedicate Sundays only to family outings. In addition, they are unaccustomed to snacking and eat promptly at 12:30, which creates bottlenecks at parks and restaurants. Disney learned that French employees objected to providing the friendly greetings and smiles expected of all amusement park workers. They then hired multilingual employees from all over Europe because Disney’s goal was to attract people from all countries of Europe. A complaint of European investors was that rigid U.S. management style did not take into account the values and customs of the people it intended to attract. For example, Europeans often bring their own lunches and do not spend money at the park’s gourmet restaurants and hotels. The park initially lost money after it opened in 1992. Discuss the course of action Disney could take to accommodate the values and customs of the people it hopes to attract.

2 pages

Answer 1

The problem here is that Disney's goal was to provide the same level of satisfaction to its customers as it did in other parts of the world. A large part of its revenues was expected to be from secondary sales (food, collectibles and the like) in other to the attractions. Also, there was the problem of the French employees refusing to create the kind of cheerful atmosphere that Disney expected of them.

These are issues which one should have thought of while planning to build the park. Disney failed to forecast it's revenues properly and find a way to provide the level of customer satisfaction (with regard to the employees) because it just tried replicating the American model on French soil. This would obviously not work out. They should have researched other amusement parks in France to figure out how they make money and tried to build their forecast models with these inputs.

The problem with the employees may very well be resolved by hiring people from across the continent, only those willing to follow Disney's rules.

But Disney can't dictate how a customer should behave or force them to buy food, toys etc within Disneyland. (These usually happen to be overpriced compared to the same stuff outside).

To successfully turnaround their losses, Disney must try to localize. In today's world, localization is the key to any company's success in foreign lands, be it a Mcdonald's or a Netflix. If the gourmet stalls don't attract crowds, they should opt for the kind of food and prices at which customers will want to eat. Also, they will have to hire a dedicated operations team to study and design a good model so as to accommodate the mealtime bottlenecks. Since the French aren't accustomed to snacking they could perhaps try to maximize sales during mealtimes itself.

It is very important to know the behavior of people from other parts of Europe since this isn't a country they want to cater to, but a continent. A good amount of heterogeneity in the tastes and preferences of the crowds is something to be expected and planned for.

Disney needs to step out of its comfort zone of planning for a country (the USA where a certain degree of homogeneity across the nation can be expected) and try to localize the content, food, and attractions for its customers.

What Disney failed to do, initially at least, was figure out the preferences and behavior of its target audience.