1. Euro Disney
The first 100 days
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Case: Euro Disney

2. Startup Opened in 1992 within budget Beginning (additional) influences
Drop of shares due to first year loss
After 5 years still problems with visitors
“Cultural Chernobyl”
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Case: Euro Disney

3. Structure of Walt Disney
Revenue in 1991
Responsible for
Theme park
$2,865
71 %
Hotels
21 %
Other
8 %
Filmed entertainment
$ 2,593
Consumer products
$ 724
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Case: Euro Disney

4. WDC resorts: Walt Disney World Resort (Orlando, 1971)
Magic Kingdom
Disney MGM Studios Theme Park
Epcot Center
Disneyland (Los Angeles, 1955)
Others
Tokyo Disneyland: designed by WDC but owned and run by Oriental Land Company
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Case: Euro Disney

5. Visitors 50 million 90 % repeat customers, 5 % from Europe
Adults in late twenties with young
children
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Case: Euro Disney

6. Success factors Creative imagination: Park set-up Cartoons come alive
Participation of visitors
Parks are continually updated
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Case: Euro Disney

7. Disney’s stated goal is
To exceed its customers’ expectation every day.
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Case: Euro Disney

8. This goal is supported by:
standard of service,
park design
operating details
human resource policies and practices
Disney “play” would be flawlessly performed day in and day out at each location.
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Case: Euro Disney

9. Service delivery has been under constant refinement.
“Disney University.”
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Case: Euro Disney

10. Hiring process: a peer interview process to select cast members
a 45-minute interview session with a Disney personnel manager
extensive orientation program in Disney’s service standards
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Case: Euro Disney

11. Service standards: safety courtesy show efficiency 10/28/02
Case: Euro Disney

12. Certain messages reinforced throughout the training:
happiness measured differently by every guest and challenge to create
customer’s perceptions are extremely fragile
employees are on stage at every moment and should look to provide service
fixing costumers problems is very important
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Case: Euro Disney

13. Employees were evaluated based upon:
energy
enthusiasm
commitment
pride
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Case: Euro Disney

14. Success of Disney in Tokyo:
strong Japanese appetite for American-styled popular entertainment
increasing trend in Japan toward leisure
country which actively resisted many U.S. products
appeal for Disney’s brand of entertainment
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Case: Euro Disney

15. The reasons why Tokyo Disneyland worked:
Young Japanese are very clean cut.
Japanese are generally comfortable
wearing uniforms
Obeying their bosses
Like to be part of a team.
They are very patient.
Japanese are always very polite to strangers.
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Case: Euro Disney

16. Location of the Euro Disney site
1981: Bidding process involving
Germany, Spain and France
1987: Agreement with the French government
Central location
Highly popular vacation destination
The only disadvantage seem to be the inclement weather
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Case: Euro Disney

17. Contractual concessions with the French government
The French government agreed to
extend highways and the railway
build a high-speed TGV train extension
The French government would reduce the value-added tax
The French government provided over $700 millions in loans
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Case: Euro Disney

18. Financial Facts
Euro Disney was 49 % owned by The Walt Disney Company and 51 % owned by Euro Disney S.C.A
Admission to the park cost $41 for adults and
$27 for children
The capacity of the park was 50,000 visitors
Cost estimates were determined by the consulting firm ADL
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Case: Euro Disney

19. Financial Goals Attracting 11 million visitors in the
first year of operation
Achieving operating income of $373 million at April 12,1992
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Case: Euro Disney

20. Phase II Disney MGM studios Park and additional hotel rooms
Attracting 8 million visitors
Disney budgeted $3 billion to complete Phase II
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Case: Euro Disney

21. Theme Park Design Phase 1 Theme Park 29 Rides and Attractions
6 Themed Hotels
Davey Crockett Campground
414 Cabins
27 hole Championship Golf Course
Restaraunts, shops, and entertainment options
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Case: Euro Disney

22. French Intellectuals proposed ideas about:
Cultural requirements
Park design
Grooming standards
Eating habits
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Case: Euro Disney

23. Research concluded that Europeans were interested in:
New York
Disney land
The Western United States
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Case: Euro Disney

24. Actions taken: Add 3 western theme hotels French was first language
Signs & employees were bilingual
Characters altered to meet French ideas
Disney did not offer wine within the park
Disney had many entertainment shops and foods
Disney was thought of as an “Imaginary Place, a culture without sin”
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Case: Euro Disney

25. Start Up Process Employment Marketing Disney Service and operations
Problems
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Case: Euro Disney

26. Employment Hire and train employees 14000 people to fill 12000 jobs
Another 5000 people for peak season
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Case: Euro Disney

27. Marketing Give the park a European flavor
Advertised in magazines throughout Europe
Sleeping beauty Castle
Nestle
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Case: Euro Disney

28. Service and Operations
Euro Disney University
Disney Standards
Diversity of Nationalities
270 managers and supervisors were cross trained
200 managers were imported
employees
paid $6.50/hour
generally worked 169 hours a month
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Case: Euro Disney

29. Problems Dress code Housing shortage
Employees are leaving or being laid off
Examples of employees
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Case: Euro Disney

30. Visitors
9% Other
18% 8%
18%
40%
3.5%
3.5%
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Case: Euro Disney

31. Decisions Big issues prioritizing objectives: Revenue outlook
Cost problems
Service delivery system
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Case: Euro Disney

32. Decision sets 1st set of decisions: 2nd set of decisions:
Service system up to the standards and cost levels
of the other Disney Parks
2nd set of decisions:
How to market for achieving winter attendance targets
3rd set of decisions:
Phase II
The level of investments
Timing of investments
Nature of investments
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Case: Euro Disney

33. A day at Eurodisney ‘Trains on Strike; Tourists Unable to Reach Park’
‘Euro Disney Visitors Complain of Long Lines and
High Prices’
‘Guests find Euro Disney Employees Rude’
‘Visitors Claim Euro Disney is a Fairy Tale come True’
‘Europeans not Impressed with American Fast-Food’
‘Disney Shows Lack of Appreciation for French Culture- Wine not Served in Park’
‘Euro Disney not up to Standards of American Theme Parks’
‘Europeans Discover the Old West at Frontierland’
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Case: Euro Disney

34. Disney’s concerns Disney does not fit traditional French entertainment
Competition from Paris entertainment industry
Linguistic barriers – Europe is multilingual
Cultural barriers – food habits, alcohol a part of diet,
long lines
Europe is multicultural with differences in perceptions for entertainment
Lack of housing accommodations for staff
Acceptance of Disney as part of American culture by the French?
Cold weather could be a deterrent
Expensive by European standards
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Case: Euro Disney

35. Questions
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Case: Euro Disney

36. To answer question divide it into parts:
Assess Disney’s decision to build a theme park in Europe. How can such a decision be evaluated and was it a wise one?
To answer question divide it into parts:
Is Europe a good (new) market?
What possibilities were there?
How was it executed?
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Case: Euro Disney

37. What is Euro Disney’s target Market
What is Euro Disney’s target Market? What are the implications for the development and organization of the park?
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Case: Euro Disney

38. 10/28/02 Case: Euro Disney Needs Consumers Technology Entertainment
High Services Level
Other facilities around and in the park,
such as hotels, restaurants
The park
Walt Disney figures
Fantasy world
Vacation
Being together with family
Have fun
Young families.
families
Young couples
Middle/Upper class
Grandparents
Other
Disney
fans
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Case: Euro Disney

39. Customers Children Young families families
Grandparents with grandchildren
Disney fans
People that can afford spending money on the park (middle class and upper class)
People who just want to go so badly that they put other things aside to be able to go to Euro Disney
European people
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Case: Euro Disney

40. Target Market The majority of Disney visitors are
adults many of them are in the late
twenties and have young children. The rest
are people from four to sixty years who
have enough money to spend, to have a
good time with Walt Disney’s entertainment
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Case: Euro Disney

41. What issues must a company think through before extending a successful service overseas?
What is the expected service for Europeans?
What is expected out of design and service standards?
Are employees sufficiently screened and have the issues of supply and demand been worked out to suit European demands?
Does the level of service delivery and/or exceed the expectations of Europeans?
Does the company have the correct expectations about European consumers?
Does the company know what the expected standards are?
Does the company deliver these services properly and efficiently?
Does the company live up to its promises and communicate in a satisfactory way to Europeans?
Have they done the proper research to make these conclusions?
Have they done the proper research?
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Case: Euro Disney

42. Service delivery: Disney standard Disney University
Treatment of employee's
Integrate the cultures
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Case: Euro Disney

43. Should Euro Disney proceed with the next step of development?
Euro Disney should first solve their problems before they expand
Euro Disney could apply the lessons
they have learned from the Phase I experience to Phase II
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Case: Euro Disney

44. Service recovery strategies
Fail-safe the service
Welcome and encourage complaints
Act Quickly
Treat customers fairly
Learn from recovery experiences
Learn from lost customers
learn from Phase I experience
Satisfaction surveys and employees as listening posts
Empower employees to act quickly
Fair interpersonal treatment
Project teams can be assigned to a problematic area to develop a solution
Difficult for Euro Disney to identify lost customers

45. What lessons has Euro Disney learned which could be applied to the development of the second park?
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Case: Euro Disney

46. Expected Service Perceived Service Customer Gap Customer
External communications to customers
Service delivery
Company
Gap 4
Gap 3
Customer-driven Service designs and standards
Gap 2
Company perception of consumer expectations
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Case: Euro Disney

47. Evaluation Inadequate marketing research orientation
Lack of upward communication
Insufficient relationship focus
Inadequate service recovery
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Case: Euro Disney

48. Adapt for the local market from the US model and if so, how?
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Case: Euro Disney

49. Recommendations Adapt to French standards & expectations
Employee involvement in Euro Disney planning & operations
Single theme for Euro Disney; focus on French culture
Promote winter attendance through reduced costs and package plans
Identify additional target markets (i.e., student groups)
Before expanding, understand Disney fit with European cultures
Package Euro-Disney with other Paris destinations
Prepare to contract buses if public transport is disrupted.
Leave some memorial for any villages/ people displaced by park. Give displaced people lifetime pass.
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Case: Euro Disney

50. Questions
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Case: Euro Disney

51. Thank you for your attention
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Case: Euro Disney