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Cross Cultural Issues in Euro Disneyland

Essay by   •  March 13, 2012  •  Case Study  •  1,394 Words (6 Pages)  •  2,202 Views

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SOCIO- CULTURAL PROBLEMS FACED BY WALT DISNEY IN EUROPE

In the mid-1980s, with a well-penetrated American market and the phenomenal success of Tokyo Disneyland, Disney decided to expand worldwide to achieve optimal market growth. In 1987, after considering more than 200 possible sites for theme park in Europe, Marne-La-Valle ́e (d'Hauteserre, 1999), located just outside Paris was chosen. This location was selected not only for its beauty and history, but also for its vital position in Europe so that there is easy access by train, plane, and cars. The decision to select Paris, instead of Spain, was for the guarantee of financial incentives and developments of transport systems.

Disney had decided to build the theme park, Euro Disney on about 4800 acres of land. Approximately half of the developable land which is 2115 acres would be used for entertainment and resort facilities. Another 1994 acres would be exploited for retail, industrial, commercial, and residential uses. The remaining 691 acres would be used for regional and primary infrastructure, like roads and railway tracks.

Euro Disney finally opened on 12 April 1992 (Adekola&Sergi, 2007), employing 12,000 people and had predicted that there would be 11 million visitors in the first year. Euro Disney had park, six hotels, and an entertainment and retail center. Though there was so much publicity, enthusiasm, and anticipation, the first season that Euro Disney's first chairman, Robert Fitzpatrick, had forecast was unsuccessful. He did not see expected levels - 50,000 people visited the park instead of the projected 500,000, food and souvenir sales were low, occupancy rates in the six hotels were low and the Disney Corporation could not capitalize on its enormous land holdings. Within first four months, over 1000 employees quit their jobs & complaints of working conditions were there.

Euro Disney's situation was terrible. Its stock ownership came down to 39%. Hotel occupancy rates were 37%, a sharp contrast with the rest of Disney's US properties, where occupancy rates were 92%. The French government had given the farmland to Euro Disney; this led to protests from French farmers. The amount of debt increased, as ticket sales declined.

Critics said it was a transplant of American culture into one of the intellectual centers of Europe and it was not Europe's cup of tea'. Many in the entertainment industry take Euro Disney as a case study on how not to open a theme park.After heavy losses, Euro Disney believed it would shut down. Robert Fitzpatrick resigned as Euro Disney's first chairman in April 1993, six years after he took the job. Now, Euro Disney's new chairman was Philippe Bourguignon, Disney insider who changed the scenario.

RESOLVING THE CROSS CULTURAL ISSUES

After careful revaluation of its major problems, the company began making a series of essential modifications. First of all, it renamed Euro Disney to 'Disneyland Paris', it would help locate the theme park with precision on the map of Europe. Second major change was implemented by the Disney Corporation- fired the American chairman and appointed a French citizen as the new boss in 2003, who introduced new shows. A third major change, advised by the new managers, was to abandon Disney's global approach to local European approach.

Glocalization of Disneyland Paris

Glocalization means adopting the local strategy at the global level. Though a disappointing start, Disneyland Paris was forced to glocalize its corporate philosophy, practices, services, attractions, and products to adapt the park to European tastes. By appointing a French manager, top US-based CEOs such as Michael Eisner now realized the importance of European cultural traditions.

This section explains, in detail, the four major glocalizing changes that have made Disneyland Paris successful:

1) Cutting down the prices

When Euro Disney opened in April 1992, Europe was amidst an economic recession. So, the high admission prices turned off European visitors. The situation was made worse by the high prices on merchandise and menus inside the park. In 1995, a year after it became 'Disneyland Paris', the admission

prices for a single adult was cut, thus visitors increased by about 23% in 1995, the park operated at a profit for the first time.

In

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