How do you account for Disney’s management erring so badly, both at the beginning and even or years afterwards? Disney executives did not account for the cultural differences. They were making predictions from European visitors that visited American Disney. They were charging too much for example; Park admission was $42 more than tickets prices in America and hotels were $340 a night. They soon were only averaging 50% occupancy. They had some big loans to pay back.
Operational errors such as staffing for example was another issue in the management. Management assumed Friday would be a busy and Mondays would be light, so they staffed accordingly; however it was just the opposite. Operational mishaps such as these will cost a Giant company like Disney waste millions of dollars.
How would you account for the success of Tokyo Disneyland compared to the problems of Euro Disney? Due to Disney not owning Tokyo Disneyland to operate it. Disney invested no money and gets the licensing fees, a 10% of the revenues and 5% from concessions. The native company is running the Tokyo Disney and managers know what Japanese need. I found this example; Japanese like to give omiyage to friends and colleagues when they have been a famous place or go to travel. The omiyage is a food that likes cookie, cake, chocolate, or local special food. Therefore, in Tokyo Disneyland, there are a lot of omiyages that put in a cute and Disney style case in store. Those omiyages cannot find in American Disney Park
Could a better reading of the cultural differences have made a difference? Yes. Euro Disney did not notice the cultural differences at beginning, so they took more than 20 months to improve the operational mishaps and had to adjust to the miscalculations.
What recommendations would you suggest to management? I suggest that Euro Disney hire more native managers, because they are going to know what Europeans what and need.
