Disney Theme Parks Case
1. What do you think motivated Disney to set up parks abroad, and what might be the pros and cons from the standpoint of the Walt Disney Company?
Disney is motivated to set up parks throughout the world to expand its sales of merchandise goods as well as attendance to their theme parks. In addition, with the expansion of the parks, Disney can play a role in spreading advertisements of their movies and the ideology that Disney is a Place of Dream and happiness. Disney is motivated to also acquire more resources by their expansion, for example, Disney wants to create a park in Shanghai so that it can facilitate in probably creating a Disney channel for the Chinese people. Lastly, Disney wants to minimize the risk of their parks in America in case they do poorly they can gain their profits in Asia or Europe.
Pros:
- Sales expansion
- Resource acquisition
- Risk minimization
Cons:
- There are cultural factors which will inhibit the company from conducting business. For example, Paris was concerned that Disney was ruining their culture with American products and ideology.
- There are geographic influences to see where to place the park and where it would be profitable. Also, which area is closer to the population of the area and mass transportation.
- Competition of amusement parks.
- Political and legal drawbacks of certain countries.
2. Why do you suppose Disney made no financial investment in Japan, one of $140 million in France, and then one of over $300 million in Hong Kong?
I believe that Disney made no financial investment in Japan because it was the first theme park for Disney outside of the United States. Disney knew it was a tremendous gamble to place their theme park in Japan. It was never done before and Disney was afraid of the risk, therefore, it allowed to work with the Oriental Land Company to create Disney and make money from the royalties instead and give the Oriental Land Company all the risk involved.
Disney quickly saw
Disney is motivated to set up parks throughout the world to expand its sales of merchandise goods as well as attendance to their theme parks. In addition, with the expansion of the parks, Disney can play a role in spreading advertisements of their movies and the ideology that Disney is a Place of Dream and happiness. Disney is motivated to also acquire more resources by their expansion, for example, Disney wants to create a park in Shanghai so that it can facilitate in probably creating a Disney channel for the Chinese people. Lastly, Disney wants to minimize the risk of their parks in America in case they do poorly they can gain their profits in Asia or Europe.
Pros:
- Sales expansion
- Resource acquisition
- Risk minimization
Cons:
- There are cultural factors which will inhibit the company from conducting business. For example, Paris was concerned that Disney was ruining their culture with American products and ideology.
- There are geographic influences to see where to place the park and where it would be profitable. Also, which area is closer to the population of the area and mass transportation.
- Competition of amusement parks.
- Political and legal drawbacks of certain countries.
2. Why do you suppose Disney made no financial investment in Japan, one of $140 million in France, and then one of over $300 million in Hong Kong?
I believe that Disney made no financial investment in Japan because it was the first theme park for Disney outside of the United States. Disney knew it was a tremendous gamble to place their theme park in Japan. It was never done before and Disney was afraid of the risk, therefore, it allowed to work with the Oriental Land Company to create Disney and make money from the royalties instead and give the Oriental Land Company all the risk involved.
Disney quickly saw