Following on from the success of the Disneyland theme park in Anaheim, plans to build a European version called Euro Disney. Then, Paris location was the prime choice over 200 other potential sites because of French government’s generous incentives. However, Euro Disney started to face problems from the very first year of its opening. Management overconfidence was the biggest problem in Euro Disney. Just because Tokyo Disneyland accepted American culture, the management thought that it would also work in Europe. However, the cultural differences affected Euro Disney a lot. From dress quote to food and beverage, serving every aspect was with error because of not adapting the local culture. Euro Disney was also over-populated with hotels, especially for a park that can be reasonably well explored within a full day. Then the price range was unreachable high for the visitors. Then, share price of Euro Disney starts falling. Then they realized that cross-cultural marketing was missing to gather more visitors. So, the parent Disney’s management changed their marketing strategies. Then to remove the bad image from the people’s mind the management park's changed from Euro Disney to "Disneyland Paris", in order to more closely link the park with the romantic city of Paris, and to disassociate itself with the poor reputation that has related with the phrase "Euro Disney". After understanding the differences in culture and adapting polycentric orientation, in 1996 Disneyland Paris became France’s most visited tourist attraction.
Q.1: What factors contributed to Euro Disney’s poor performance during its first year of operation?
Within a very short time period while starting Euro Disney faced lots of problems. There were a chain of problems which Euro Disney faced consistently in European sector. Euro Disney was not the success story as the other sectors of Disney. There were various issues which drives Euro Disney towards loss. These issues are described below:
Management overconfidence was the biggest problem in Euro Disney. As we know Disney is an American organization. So, control panel was quite favorable towards American managers. So, the global thinking was missing in their management tasks. Because, the management intended to create Euro Disney according to the American beliefs and culture. Here, the management followed Ethnocentrism orientation. They never thought about the situations over European market. Much arrogance caused American management lots of loss in selecting correct employees for the tasks. Though Disney had opened their branch in European market, they never considered the people of European continent as respectful, honorable people who can be trusted. So, it was the biggest wrong move by the Euro Disney planners. So, the French visitors took this step of Disney as “Cultural Imperialism” of America. We can understand this situation as it became the worrying aspect of Euro Disney’s first year when French visitors stayed away from Euro Disney. Now, from the management theory; we can utilize The Planning Process here. Now, the process of planning takes three steps: 1. Collection of information
2. Development of several alternative plans
3. Decision for one of these plans
So, by following Ethnocentrism orientation Disney never bothered to collect proper information about the European tastes, natures, habits, preferences. As a result, the first step of collection of information went wrong. Information is the base-line of any plan. Then, development of several alternative plans was not focused enough. There was some local French cartoon characters’ theme park was located near by the Euro Disney. So, the management should have alternate plans to face this messing situation. As the plan were rigid and very narrowed by the ethnocentrism; the decision of the plan went wrong....