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Table of Contents

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EXECUTIVE SUMMARY 3
Executive Summary 3
AN INTRODUCTION TO THE WALT DISNEY COMPANY 4
The Walt Disney Company Today 4
Early Life of Walter E. Disney 7
History of the Walt Disney Company 8
HISTORY OF WALT DISNEY PARKS AND RESORTS 10
History of Walt Disney World Class Parks and Resorts 10
Disneyland 13
Walt Disney World Resort 14
Disneyland Tokyo 15
Disneyland Paris 16
Disneyland Hong Kong 18
Disneyland Shanghai 28
CONCLUSION 35
CLASS NOTES 36
SUMMARY REVIEW 37
INTENDED OBJECTIVES 37
DISCUSSION QUESTIONS 37
APPENDIX 44
BIBLIOGRAPHY 49

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EXECUTIVE SUMMARY

Executive Summary
The Walt Disney Company has developed a polycentric orientation and marketing
strategy that builds the brand internationally and that is regionally based and requires a case-by-
case level of local procurement marketing (Kotabe 17).

The first international Disney theme park in Mainland China, Disneyland Shanghai, will
officially open in 2015 (Company). It is imperative that the Walt Disney Company establishes a
positioning strategy that allows them to successfully to build the Disney brand and grow the
company in ways that make sense to consumers in Mainland China (Walt). Positioning is the
location or differentiation of the Walt Disney Company and Disneyland Shanghai in the China
entertainment market. It is defined by the provided value or the consumers perceived value
within the context of the market. The positioning strategy is the foundation, and guide, for
product and service, marketing, and overall business strategy of the Walt Disney Company and
Disneyland Shanghai. Disney is growing around the world with strategies and products that
respect different cultures and are relevant to local consumers (Walt).
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The following case study is an international marketing report on the positioning of
Disneyland Shanghai. In order to understand the positioning of the most successful international
entertainment company in the world, as well as the new Disneyland Shanghai parks and resort,
we present an overview of the following:
Walt Disney and the Walt Disney Company
Walt Disney World Class Parks and Resorts and the Operating Markets
Disneyland Shanghai and the Chinese Market

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AN INTRODUCTION TO THE WALT DISNEY COMPANY
The Walt Disney Company Today
The Walt Disney Company is recognized as the worlds most reputable and admired
entertainment company and a leader international entertainment and media enterprise
(Company). The billion dollar company has had three years of record breaking results as of
2013, done so by emphasizing creativity, innovation, and of course, imagination (Walt). In 2013,
the company reclaimed its throne as the worlds best in animation with the Frozen, the worlds
#1 animated original film (Walt). With the release of Iron Man 3 and Thor: The Dark World,
Disney shattered their record with the best box office results reaching over 4.7 billion in total
ticket sales. The Walt Disney Company also acquired Lucas Films and is currently letting fans
everywhere whip themselves into a frenzy over movie and theme park rumors (Walt). This year,
2013, the Walt Disney destination parks and resorts shattered all previous attendance records,
further establishing its place as the number one theme park group in the world, by continuing to
expand and innovate what is considered the international symbols of the Disney brand (Walt).


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The Walt Disney Company is comprised of five business segments: studio entertainment,
media networks, consumer products, interactive media, and parks and resorts (Company). The
Walt Disney Studios manages and operates all film, recording, and theatrical divisions
(Company). Media Networks manages and operates television networks, cable channels,
television stations, and associated production and distribution companies (Company). Consumer
Products creates all toys, clothing, and merchandise based on Disney characters and creations
(Company). Disney Interactive manages and operates Disneys online, mobile, social media,
virtual, and computer, and gaming ventures (Company). Parks and Resorts manage and operate
all company resorts, theme parks, cruise lines, and other travel-related assets and properties
(Company).

Studio
Entertainmnet
Media
Networks
Consumer
Products
Interactive
Media
Parks and
Resorts
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Early Life of Walter E. Disney
Walter E. Disney was born in 1901, December 5, in Chicago, Illinois (Biography). The
family moved to Marceline, Missouri soon after Walts birth (A). There, Walt Disney spent the
majority of his childhood (A). As a child he was interested in drawing, acting, and later on
photography (A). He attended McKinley High School, and the Academy of Fine Arts at night
(Biography). Fall of 1918, during the time of World War I, Walt attempted to enlist in the
military (Biography). After being rejected for being too young, Walt lied about his age, dropped
out of High school, and ventured off to France for about one year to drive ambulances for Red
Cross officials (A). The ambulance Walt Disney drove was entirely covered in his cartoons and
drawings (A). Walt Disney returned from France and attempted to start his own commercial art
company called Laugh-O-Grams, which eventually failed (A). Walt then traveled to Hollywood,
California with a suitcase and twenty or forty dollars (A). In 1923, Walt and his brother Roy
Disney found success with a series of short live-action and animated films known as the Alice
Comedies under Disney Brothers Cartoon Studio (Biography).

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History of the Walt Disney Company

In 1926 the brothers experienced some moderate success with Oswald the Lucky Rabbit
and moved over to the newly established Walt Disney Studios (Andrew). Unfortunately, Walt
was separated from the project and the company continued to struggle till 1928 when Walt
created Mickey Mouse. Mickey and girlfriend Minnie were featured in probably the most famous
Walt Disney short, Steamboat Willie (Andrew). The animated short film is noted as the first
cartoon ever to feature seamlessly integrated and synchronized sound and since has been
recognized as one of the greatest cartoons of all time (Biography). This short was a huge success
for Walt Disney and the character of Mickey Mouse has defined the company ever since
(Andrew). Walt Disney later won his first academy award for a Flowers and Trees, the very first
color cartoon, in 1932 (A).
On December 21, 1937, Walt premiered the first full-length animated musical feature,
Snow White and the Seven Dwarfs (Biography). The film took years to finish, development
beginning in 1934. The film was ten times the budget of Disneys other productions, totaling at
just under 1.5 million dollars (A). It premiered at the Carthay Theater in Los Angeles, during the
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Great Depression (A). The film made millions and won an Academy Honorary award as a
significant screen innovation which has charmed millions and pioneered a great new
entertainment field (A). Today it is a well-known monument to the motion picture industry (A).
Walt Disney Studios went on to make numerous other classics including Pinocchio,
Fantasia, Dumbo, and Bambi over the course of the next five years (A). The Walt Disney Studios
has been the foundation on which the Walt Disney Company was built (Company). Until his
death on December 15, 1966, Walt Disney explored countless other enterprises and business
ventures, pushing imagination and leveraging at times everything, to create the Walt Disney
Company we know today (Biography).

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HISTORY OF WALT DISNEY PARKS AND RESORTS
History of Walt Disney Parks and Resorts
Walt Disney found his inspiration for Walt Disney theme parks sitting on a bench
watching his daughters ride a carousel in the park, as he did every Sunday (A). Walt Disney's
dream, of an immersed storytelling and themed experience, an amusement park for both children
and their parents to create family memories, came true on July 17, 1955, the day the first
Disneyland Park opened (A). On that day, Walt Disney read his dedication of Disneyland,
christening his park with these words: To all who come to this happy place: Welcome.
Disneyland is your land. Here age relives fond memories of the past, and here youth may savor
the challenge and promise of the future. Disneyland is dedicated to the ideals, the dreams, and
the hard facts that have created America, with the hope that it will be a source of joy and
inspiration to all the world (Walter E. Disney). Now, more than 55 years later, Walt Disney
Parks and Resorts is the leading provider of family travel and leisure experiences, offering
millions of guest each year Disney magic and memories that will last forever (Company).

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The costs associated with Walt Disney Parks and Resorts include labor; depreciation;
costs of merchandise, food and beverage sold; marketing and sales expense; repairs and
maintenance; utilities; information technology; and cost of vacation club units (Walt). Additional
investments include new businesses, repurposing, and international expansions (Walt). Walt
Disney Parks and Resorts generate revenues mainly from the admissions sales for theme parks.
Additional revenue is generated from hotels and resorts, as well as the sales of food, beverage
and merchandise (Walt). The generation of revenue is dependent on the ability to attract
consumers which will be determined by the position the Walt Disney Company and Walt
Disney Parks and Resorts will hold in consumers minds.
As previously stated, Walt Disney Parks and Resorts manage and operate all company
resorts, parks, cruise lines, and other travel-related assets and properties (Company). Disney
resorts are made up of 44 different locations around the world. Disney parks are located within
resorts, 13 in total. The Disney Cruise Line is made up of four ships - the Disney Magic, Disney
Wonder, Disney Dream and Disney Fantasy. The Disney Vacation Club is made up of 12
properties and is currently approaching 200,000 total families/members (Company). Adventures
by Disney provide guided family vacation experiences to destinations around the world
(Company).

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Five world-class parks and resorts, however, are held as the heart of Walt Disney. The
sixth currently is under construction for its premiere in Shanghai, China. Disneyland Resort,
located in Anaheim, CA, is made up of Disneyland Park & Disneyland California Adventure
(Company). Walt Disney World Resort, located in Lake Buena Vista, FL, is made up of Magic
Kingdom, Epcot, Disneys Animal Kingdom, Disneys Hollywood Studios, Disneys Blizzard
Beach, & Typhoon Lagoon (Company). Tokyo Disney Resort, located in Urayasu, Chiba, Japan,
is made up of Tokyo Disneyland & Tokyo DisneySea (Company). Disneyland Paris, located in
Marne-la-Valle, France, is made up of Disneyland Paris & Walt Disney Studios Park
(Company). Hong Kong Disneyland Resort, located in Lantau Island, is made up of simply Hong
Kong Disneyland (Company). And Shanghai Disney Resort, located in the Pudong District,
China is set to open in 2015 (Company).

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Disneyland
Overview
The first of the Disney world-class parks and resorts, Disneyland, opened in Anaheim,
California on July 17, 1955. (Company). Disneyland is the only Disney theme park to have been
personally designed and constructed under Walt Disney (Company). At the center of Disneyland,
is Sleeping Beautys castle, at the time, built before the release of Walt Disneys film (Walt).
Disney films have had a mutual influence in the design of the parks, themed lands, and
attractions (Walt). Today, the Disneyland theme park consist of 461 acres are owned by Walt
Disney and 49 acres are under a long-term lease, including two theme parks: Disneyland and
Disney California Adventure, opened in 2001. (Walt). The Disneyland World Resort is marketed
through a variety of international, national and local advertising and promotional activities
(Walt). A number of attractions and restaurants in each of the theme parks are sponsored by
other corporations through long-term agreements (Walt).

The Disneyland Resort performed strongly with 23.7 million visits in 2012, an increase
of 1.3 million (Rubin). This increase is due to the opening of Cars Land at Disney California
Adventure (Rubin). Disney California Adventure performed strongly with 7.8 million, an
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increase of 1.4 million (Rubin). However, there was a noted shift in attendance from Disneyland
Park, where attendance decreased slightly to under 16 million visits (Rubin).
North America Florida Entertainment Market
The North America economy is in recovery from the recent recession (Rubin) In 2013
gross domestic product reached 2.6 and annual visits in 2012 increased by 9 million in
comparison to 2007 and 2008, which approximated at 123 million (Rubin). However, consumers
will continue to be price sensitive towards vacation packages (Rubin). As the economy in the
United States continues its recovery, consumers will likely take longer vacations and travel
further (Rubin).
Walt Disney World
Overview
The Walt Disney World Resort opened October 1, 1971 with the magic Kingdom and
two hotels near Orlando Florida (Company). The park is located in Lake Buena Vista, Florida,
outside of Orlando. Today the Walt Disney World Resort consist approximately 25,000 acres of
themed lands including: Magic Kingdom, Epcot, Disneys Hollywood Studios and Disneys
Animal Kingdom (Walt). The Walt Disney World Resort is marketed through a variety of
international, national and local advertising and promotional activities (Walt). A number of
attractions and restaurants in each of the theme parks are sponsored by other corporations
through long-term agreements (Walt).
Walt Disney World maintained its worldwide dominance with 48.5 million visits in 2012,
an increase of 400,000 (Rubin). The increase is due to the investment in new and renovated
attractions, including: the barnstormer, sorcerers of the magic kingdom, little mermaid, dumbo,
the Art of Animation Resort, and most extensively Fantasyland (Rubin). The Walt Disney
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Company has also invested in the implementation of MyMagic+(Walt). MyMagic+ is
technological innovation that allows guest to utilize the bands as park tickets, hotel keys, and
payment method (Walt). The bands are a convenient option for guest and the Park, resulting in
an increase in capacity and attendance, traffic control, and consumer spending (Walt).

North America California Entertainment Market
California Adventure, Universal Studios Hollywood, and Magic Kingdom at Walt Disney
World accounted for 57% of the increased attendance in 2012 (Rubin). The increase is due to the
addition of the Wizarding World of Harry Potter in 2011 at Universal Studios Hollywood
(Rubin). Universal Studios parks performed strongly again in 2012 (Rubin). The increase is due
to the new transformers ride, which attracted 5.9 million visits (Rubin).
Disneyland Tokyo
The first international Disney world-class park and resort, Disneyland Tokyo opened on
April 15, 1983 (Company). The park is located in Urayasu, Japan, approximately 6 miles outside
of Tokyo (Walt). Today Disneyland Tokyo consists of approximately 494 acres of land
including: Tokyo Disneyland and Tokyo DisneySea (Walt). Tokyo Disneyland is owned and
operated by the Oriental Land Company, a Japanese corporation (Walt). Walt Disney has no
equity interest of Tokyo Disneyland (Walt). Walt Disney earns royalties on revenues generated
by the Tokyo Disney Resort (Walt). The Oriental Land Company markets the Tokyo Disney
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Resort through a variety of local, domestic and international advertising and promotional
activities (Walt).

Disneyland Tokyo performed strongly with 27.5 million visits in 2012, an increase from
25.3 million (Rubin). This is due to significant attractions and renovations (Rubin).
Tokyo Entertainment Market
The Japanese economy is in post-tsunami recovery (Rubin). With investment and new
attractions the entertainment parks and resorts market ahs performed strongly (Rubin). Top
competitors in the Japanese theme park market by ranking include: Tokyo Disneyland, Tokyo
Disney Sea, Universal Studios Japan, Nagashima Spa Land, Yokohama Hakkeijima Sea Paradise
(Rubin). Universal Studios Japan performed strongly with 9.7 million visitors, an increase from
8.5 million (Rubin).
Disneyland Paris
Overview
Disneyland Paris, previously Euro Disney, opened April 12,1992 (Walt). The agreement
to build Euro Disney was signed in France on March 24, 1987 (Walt). The park is located in
Marne-la- Valle, France, approximately 20 miles outside of Paris (Walt). The Walt Disney
Company changed Euro Disney to Disneyland Paris to better reflect the Walt Disney Company
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roots in the United States (Kotabe 330). When changing the name of Euro Disney to Disneyland
Paris, the Walt Disney Company used a fade in/fade out strategy (Kotabe 337). Initially, the
Euro part in Euro Disney was made smaller and the word land was added (Kotabe 337). In
October 1994 the park officially became Disneyland Paris when the word Euro was dropped
altogether (Kotabe 337). Today Disneyland Paris consists of approximately 5,510 acres, half of
which is still under development. The primary operating company of Disneyland Paris,
responsible for managing the park is Euro Disney Associs S.C.A. (Walt). Euro Disney S.C.A. is
required to pay royalties and management fees to the Company based on the operating
performance of the resort (Walt). Euro Disney S.C.A. is a publicly traded French entity (Walt).
The Walt Disney Company has a 51% effective ownership interest in Disneyland Paris and a
40% equity interest in Euro Disney S.C.A. (Walt). In September 2012, the Walt Disney
Company provided 1.3 billion of financing to Euro Disney S.C.A, which was used to repay its
outstanding third-party bank debt (Walt). The repayment eliminated certain financial and
operating covenants, notably those related to capital expenditure limitations and the payment of
royalties and management fees due to the Walt Disney Company (Walt). The Walt Disney World
Resort is marketed through a variety of international, national and local advertising and
promotional activities (Walt). A number of attractions and restaurants in each of the theme parks
are sponsored by other corporations through long-term agreements (Walt).
European Entertainment Market
The European market is due to a poor economy and cold and wet climate has had
difficulty within the park and resort industry (Rubin). Tourism in Europe is in decline due to the
economic recession. Annually, weather in Europe has suffered from increasing amounts of rain
and cold weather (Rubin). Furthermore, tourism in Europe is in decline due to the economic
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recession and political scourge (Rubin). However, Parc Asterix, Puy du Fou, and Legoland
Windsor, reinvested in attractions increasing attendance by 5.3%, 6.7%, and 8%, respectively
(Rubin). Parc Asterix has been able to increase attendance with the addition of a new Egyptian
themed land and new Oziris Coaster, The park offers a balance for thrill rides and family
oriented attractions and rides. Puy du Fou received the classic award from the TEA in 2012 for
their shows, rich in French culture and family celebrations such as the Christmas Grand Noel
Show, which had attracted more than 90,000 spectators (Rubin). Puy du Fou amplified and
focused their marketing campaigns, increasing their domestic attendances in France. Legoland
Windsor of Merlins entertainment made the addition of a hotel and resort villages, focused on
attracting families (Rubin). Merlins Entertainment has been able to increase attendance overall
by 16% (Rubin). These midway attractions have diversified their portfolio by making additions
such as Sea Life aquariums, Dungeons, and the Tussands group sites (Rubin).
Disneyland Hong Kong
Interest, Negotiations, and Developing a Relationship with China
In the 1930s the Walt Disney Co. screened their first animation in China (Shanghai). By
2009 the Walt Disney Company had developed a strong relationship with China (Shanghai). In
the 2009 fiscal year, the Walt Disney Company China, a Dow 30 company, had revenues of
nearly $38 billion (Shanghai). Walt Disney offices in Beijing, Shanghai and Guangzhou,
consisted of over 600 employees (Shanghai).
It wasnt until the 1990s that the Walt Disney Co. began looking at Asian markets for a
potential world-class resort (Bob). At the time China was continuing to grow at a rapid pace
(Bob). Hong Kong had been the obvious first priority and Shanghai was a definite second (Bob).
Early on in the 2000s the Walt Disney Company finalized an agreement for Disneyland Hong
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Kong, and began the 11 years of negotiations for Disneyland Shanghai (Bob). The extensive
length of time in negotiations was due to a long line of complications (Bob).

Chinese Entertainment Market
China's entertainment and media market was valued at $120 billion in 2013, and is
estimated to grow by another $28 billion in 2014. In 2013, China, along with Russia, Japan,
and the United Kingdom, became on of the biggest international markets for Disney movies
(Walt). China's own film industry is currently the second largest after Hollywood (How). China
has long been an emerging market, with the largest population in the world, consisting of 1.3
billion potential customers for a Disneyland Resort (Bob). China had approximately 109 million
theme park visits in 2012, compared to 132 visits in North America (Rubin). The number of
theme park visits in China will soon surpass those of North America (Rubin).
China's strict political film guidelines have made it difficult for Western filmmakers
and studios to enter Chinas entertainment and media market (How). Every movie must
meet strict guidelines in regards to nudity, violence and politically sensitive scenes as well as the
amendment opinions of a 37-member film censorship committee. Furthermore, China maintains
a 34 films quota for imported Hollywood movies, meaning that a film has to compete to be one
of the 34 Hollywood films permitted in China each year (Reuters). This being an increase from
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the 20 films allowed annually in 2012 (How). China released an alternative of Iron Man 3,
featuring Chinese actress Fan Bingbing, and actor Wang Xueqi, to be released to the Chinese
market, resulting in record sales in the Chinese box office (Walt). Overall, the strict political film
guidelines make it difficult for Western filmmakers like the Walt Disney Company to penetrate
the Chinese market (How).

The Walt Disney Company will also face competition in establishing its brand and
releasing Disney branded movies (Reuters). The Dalian Wanda Group is internationally
expanding the AMC theater company, which was acquired last year in 2012 for $2.6 billion
(Brzeski). The Dalian Wanda Group will transform the country's movie industry into the world's
biggest within five years under a $8.2 billion film investment plan (Brzeski). Wanda has signed
agreements with film studios and talent agencies to have about 30 foreign movies produced at
the new facility every year, as well as 100 local films (Brzeski). Wanda donated $20 million
toward the organization's film museum in Los Angeles (Brzeski). The Academy had signed an
agreement supporting an annual Qingdao International Film Festival every September starting
from 2016 (Brzeski). He said it would be one of the world's top international film festivals within
three to five years, pending government approval (Brzeski). Additionally, Viacoms Paramount
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Pictures and DreamWorks Animation SKG have hired Chinese actors and set up co-productions
with Chinese firms (Reuters).

The entertainment, parks, and resorts industry in China is undergoing a huge shift
that will completely transform the market in the next coming decade (Rubin). The industry
for amusement parks emerged in China in the 1980s (Tiangyu). The Beijing Shijingshan
Amusement Park and Shanghai Jinjiang Amusement Park had been successful, but were less
cultivated than the majority of United States and European theme parks (Tiangyu). The parks
lacked theme and marketing capabilities to attract visitors (Tiangyu). Since then due to a strong
market competition, and lack of experience and efficiency, many of those theme parks have
closed (Tiangyu). In the mid 1990s, there have been more recent ventures that focused on
cultivating an experience including Happy Valley and Chimelong Paradise Park (Tiangyu).
Today, two china-based companies, OCT Group and Haichang Group, now compete globally as
one of the top ten park chains in terms of visitor attendance (Rubin). Though competition is
fierce, the current market for theme parks in China is significantly unsaturated (Rubin). In the
near future, the Chinese market for theme parks is predicted to become even more competitive
than the United States (Tiangyu).
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Competition in the Chinese Entertainment Market
The Walt Disney Company faces substantial competition from alternative providers
of the products and services the company offers and from other forms of entertainment,
lodging, tourism and recreational activities (Walt). The Walt Disney theme parks and resorts
compete for guests with all other forms of entertainment, lodging, tourism and recreation
activities (Walt). Our studio operations compete for customers with all other forms of
entertainment (Walt). The Walt Disney Company will not only need to compete for their position
on a national level, but an international level (Kotabe 219). The entertainment, parks, and
resorts industry in China, since the 1980s, has been undergoing a shift that will completely
transform the market in the next coming decade (Rubin). Since then due to a strong market
competition, and lack of experience and efficiency, many of those theme parks have closed
(Tiangyu). Two china-based companies, OCT Group and Haichang Group, now compete
globally as one of the top ten park chains in terms of visitor attendance (Rubin). Increased
competitive pressures may reduce revenues or increase our costs (Walt). Competition in each
of these areas may divert consumers from our creative or other products, or to other products or
other forms of entertainment, which could reduce our revenue or increase our marketing costs
(Walt). Such competition may also reduce, or limit growth in, prices for our products and
services, including advertising rates and subscription fees at our media networks, parks and
resorts admissions and room rates, and prices for consumer products from which we derive
license revenues (Walt). Walt Disney Parks and Resorts local competitors will attempt to
learn and gain an advantage over the Walt Disney Company (Tiangyu). The addition of
international competitors in this market will allow local home-grown theme park operators to
learn the operations and services that have made Disney and Universal so successful (Tiangyu).
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The internationally renowned theme parks will stimulate tourism in those areas; however, these
homegrown theme parks have more knowledge about the Chinese market, more products and
service offerings marketed directly to the Chinese market, and with less costs (Tiangyu). The
competition may benefit Walt Disney Parks and Resorts, attracting bigger populations
(Tiangyu). In Orlando and Anaheim, competition has benefitted Walt Disney Parks and Resorts,
attracting bigger populations with a bigger cluster of attractions (Einhorn). In Orlando and
Anaheim, competition has benefitted Walt Disney Parks and Resorts, attracting bigger
populations with a bigger cluster of attractions (Einhorn). Therefore the success of Macau and
Hengqin, as well as other resorts may prove to benefit Disneyland Hong Kong, Just as
Disneyland Shanghai will after 2015 (Einhorn).
Universal Studios is planning to open a Hollywood movie theme park, Universal
Studios Beijing. The facility will cover a 51-acre site and the total budget will be 12 billion
Yuan or $1.95 billion. Construction is due to start in the fourth quarter of 2014 and aim of
opening the park in January 2018.Universal Creative division of Universal Parks and Resorts has
also been advertising for Mandarin Chinese-speaking staff. The Chinese partners, Beijing
Tourism Group, which is part of the capital's municipal government, will provide the land and an
unspecified part of the investment, while Universal Studios will be responsible for branding,
intellectual property, technology and management of the park, Sina reported. In a separate report,
the Global Times daily reported that municipal authorities are planning to build a monorail in
Beijing, with the terminus in the new Universal Studios in the southeastern suburb of Tongzhou.
Universal Studios operates three resorts in Asia. Both facilities are massively popular with
Mainland Chinese tourists, as is the Los Angeles Universal Studios.
In Hengqin, casinos and resorts are transforming the city of Macau into a resort
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destination (Einhorn). Macau is in close proximity to Disneyland Hong Kong, (Einhorn). The
expansion will include golf courses, theme parks, and other attractions (Einhorn). Lui Che Woo
of Galaxy Entertainment, Asias second richest man, is ready to invest HK$10 billion in Hengqin
(Einhorn). The mainland-based theme-park operator, Guangdong Chimelong Group has recently
opened Chimelong Ocean Resort, a park similar to Sea World in the United States, featuring
rides, an aquarium, and a circus (Einhorn). The Chimelong Ocean Resort will help increase
tourism in Macau, recently attracting about half a million visitors during the Chinese New Year
holiday, and be beneficial to casino operators (Einhorn). Many of the Chimelong park visitors
were tourists on package tours to Hong Kong and Macau (Einhorn). The exclusion may result in
a loss of visitors for Disneyland Hong Kong (Einhorn).

The Wanda Company has plans for 10 cultural tourist destinations with
entertainment and shopping outlets, and developments that will reflect the local culture of
the region (Brzeski). These mega-development projects are known as Wanda Cities (Brzeski).
In Haerbin, Nanchang, Hefei and Qingdaom development is underway (Brzeski). In Beijing,
Guangzhou, and Dalian real estate is now more mature and will begin development soon
(Brzeski). Chairman Wang, of the Wanda Company signed a deal with the city of Wuxi, just
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west of Shanghai, to build a $5.9 billion cultural tourism city (Brzeski). Chairman Wanda states
that Wuxi Wanda City will be open in 2016 and he is confident that the destination will surpass
Disney in both revenue and number of visitors (Brzeski). Wuxi Wanda City will span 296 acres
around a small lake. It will include an outdoor amusement park, a film city with 3D cinemas,
an indoor childrens theme park, an extreme sports hall, seven resort hotels, a commercial
center with over 200 retail shops, and a bar street of at least 20 venues (Brzeski).
The OCT group has been recognized for their educational childrens attractions,
featuring a major aquarium, full rounded product, service and entertainment offerings, as
well as themed retail and dining options (Rubin). The resort serves as model for future
developments in China (Rubin). The OCT Group recently opened a new Happy Valley park in
Wuhan and is Tianjin and is said to be a leader of the theme park trend in China (Rubin). The
Chimelong Group has recently opened Ocean Kingdom in Zhuhai featuring a theme park
and hotel (Rubin). Chimelong Waterpark had the highest attendance in Asia for waterparks in
2012. Ocean Park Hong Kong plans to open a new indoor/outdoor waterpark in 2017 (Rubin). In
2012 the Happy Magic Water Cube and Olympic Water Cube Indoor Water Park, one
year after opening, established themselves as leaders in the industry with 968,000 and
605,000 in attendance, respectfully (Rubin). The Olympic Water Cube Indoor Water Park has
extended hours to 10 pm (Rubin). Huayi Brothers, a Chinese production company is
currently constructing a resort on the holiday island of Hainan. The park theme is Xiaogang
films, a top director in China. DreamWorks Animation's China unit, Oriental DreamWorks,
is developing a $3.1 billion cultural and entertainment destination in Shanghai. Oriental
DreamWorks will partner with the China Media Capital (CMC), the Shanghai Media Group, and
Shanghai Alliance Investment.
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Overview

The first international Disney world class park and resort in China, Disneyland Hong
Kong opened on September 12, 2005 (Company). The park is located on Lantau Island, China, in
close proximity to Hong Kong and Hong Kong International Airport (Walt). Today Disneyland
Hong Kong consists of approximately 310 acres of land including: Hong Kong Disneyland
(Walt). Disneyland Hong Kong is owned and operated by Hong Kong International Theme Parks
Limited. The Walt Disney Company owns a 48% interest, while the government of the Hong
Kong Special Administrative Region (HKSAR) owns a 52% majority interest (Walt). The Walt
Disney Company is entitled to receive royalties and management fees based on the operating
performance of Hong Kong Disneyland Resort (Walt).
Integration with China and Chinese Culture
The Walt Disney Company wanted to create an experience that encompassed Disney
Magic with Chinese culture (Disney). The Walt Disney Company consulted Chinese feng shui
experts when designing the Disneyland Hong Kong theme park. Hong Kong Disneyland
spokeswoman Esther Wong said Disney decided to observe feng shui because it wanted to defer
to local custom (Feng). Feng shui is the Chinese belief that harmonious energy and therefore
better fortune can be achieved by the proper positioning of structures, furniture, objects (Feng).
In Asian countries with large Chinese ethnic communities, the ancient philosophy of feng shui
The Positioning of an International World Class Park and Resort in order to Create Disney Magic

27
(wind-water) plays an important role in the design and placement of corporate buildings and
retail spaces (Kotabe 108). The feng shui experts made changes to the design such as shifting the
angle of the of the park 12 degrees so that the park's orientation faces water with mountains
behind it, placing cash registers close to corners or along walls, setting up no fire zones in
kitchens, excluding the fourth-floor number, a number associated with bad luck, in elevators, a
ballroom measuring exactly 888 square meters, a number that symbolizes prosperity, and
burning ritual incense at the completion of a building (Kotabe 108).

Initial Difficulties Earning Profits
Disneyland Hong Kong initially had disappointing results due to competition and
disappointing park offerings for visitors (Einhorn). However, in 2013 revenue increase 15% to
$4.9 billion (Einhorn). The Disneyland Park is the smallest of all the Disney resorts out of all the
Disney Parks (Einhorn). The park opened with limited attractions; visitors were disappointed
that the iconic Autopia and Its a Small World rides were not included in the plans (Einhorn).
Disney has since increased the total park size by one-fourth launching these attractions as well as
three new lands (Einhorn). However, the park is still the smallest of Disneys world-class resorts
(Einhorn). Disneyland Hong Kong is continuing their plans to expand the park, launching the
Iron Man Experience in 2016 (Einhorn).
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28
Disneyland Shanghai
Overview

In 2011, the Walt Disney Company and the Shanghai Shendi Group received Chinese
central government approval of an agreement to build and operate the Shanghai Disney world-
class park and resort in the Pudong district (Walt). On April 8, 2011, the Walt Disney Company,
the Shanghai Shendi Group, the Chinese government, and local community representatives and
media friends celebrated the beginning Shanghai Disney Resort at the official ground breaking
ceremony (Disney). The resort is owned by a joint venture under the Shanghai Shendi Group
with 57% ownership and the Walt Disney Company with 43% ownership (Walt). The planned
investment was approximately 29 billion Yuan (Walt). The investment will be funded according
to each partners equity ownership percentage (Walt). Creating, constructing and operating the
resort will be under an additional joint venture management company, under the Walt Disney
Company with 70% interest and the Shanghai Shendi Group with 30% interest (Walt). The
management company will also pay the Walt Disney Company royalties based on resort
revenues and receive payment based on operating performance of the resort (Walt).
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29
Integration with China and Chinese Culture

The Walt Disney Co. and the Shanghai Disneyland Resort is integrating China and
Chinese culture in order to penetrate the market in Mainland China.
The Shanghai Disneyland Park and Resort is targeted towards children, parents, friends,
and families and will be designed to be a one-of-a-kind destination that is authentically Disney
and distinctly Chinese (Walt). The Walt Disney Imagineering unit designs and develops new
theme park concepts and attractions as well as resort properties (Walt). The goal for Disney
Imagineers is to create an experience that combines classic Disney stories with elements unique
to China (Disney). The park will be authentically Disney with Disney attractions, entertainment,
and experiences built around several themed lands across the resort (About). The first phase of
Shanghai Disneyland is the classic Magic Kingdom and castle (Shanghai). The future Storybook
Castle is said to be the most interactive Disney castle yet, complete with enchanted staircases and
a secret boat ride (About). Other amenities associated with classic Disney destinations will be
including two themed hotels, a huge 495,000 square foot retail sector filled with shops, dining
establishments, entertainment venues and performances, an array of recreation facilities (About).
The park will feature distinct Chinese characteristics in the scenery, designs, accommodations,
shopping and dining, parades and shows, and the overall experience (Resort). Chinese consumers
The Positioning of an International World Class Park and Resort in order to Create Disney Magic

30
prefer extravagant shows with casts of hundreds to thrill rides popular in the Unites States
(Macleod). The setting is very tranquil and would feature premium benefits for food, massages,
concerts, and entertainment (Rubin). However, others are excited to have access to thrilling rides
and rollercoasters especially popular in the United States (Macleod). Visitors in Asia would not
simply be family oriented, but include young adults, groups of students, friends, and work
colleagues (Rubin).
The Walt Disney Company and the Shanghai Media Group joined in a multiyear strategic
alliance to provide entertainment that are co-produced locally and incorporate Chinese themes in
Disney movies in order to target either the Chinese or international market (How). The co-
development agreement will allow both companies to acquire technical and marketing expertise,
expand training opportunities between Chinese and American writers and filmmakers, and allow
easier releases of the Disney films in the China market (Reuters).
To capitalize on the rising importance of children within Chinese society, the Walt
Disney Company has developed goods and services that cater towards children in China (Kotabe
95). Children in China, due to the political situation, are regularly doted upon and given gift and
pocket money (Kotabe 95). The Walt Disney Company has launched a chain of English language
schools, branded Disney English, using Disney-inspired learning materials such as storytelling,
sing-alongs, and role-playing (Kotabe 96).
For the Chinese New year, the project development team of the Shanghai Disneyland
Parks and Resort held a three-day celebration for the Shanghai resort workers and cast before
they headed home to celebrate with their families (Mickey). The festivities had holiday
greetings, local entertainment, and traditional games (Mickey). The festivities were in the style
of a traditional Chinese temple or fair. Mickey and Minnie Mouse made a special appearance,
The Positioning of an International World Class Park and Resort in order to Create Disney Magic

31
wearing Chinese New Year outfits. Recognition was given to workers who had made
contributions to work safety and quality (Mickey). And each and every worker was presented
with a set of Disney gifts to thank them for their hard work over the past lunar year (Mickey).

The Shanghai Disneyland Resort is expected to develop local industries, boost
tourism of the surrounding region, as well as the urbanization of central Pudong New Area
(Resort). The construction industries working with Shanghai Disneyland will gain experience
with the park and improve management standards in domestic construction (Resort). The
Shanghai Disneyland Resort is recruiting local talent for the resort and will provide all cast
members with special training to help them deliver welcoming, world-class service (Disney).
The Walt Disney Co. and the Shanghai Disneyland Resort strategic alliances with
various industries, companies, and organizations will further develop the local industries of
Mainland China.
The Walt Disney Company and the domestic tourism industry will design ticket plans
that seek to balance visitor numbers during peak and trough seasons, and ensure the safety of
visitors during peak periods, extreme weather, and emergencies (Resort). The Shanghai Disney
Resort and the Shanghai International Tourism Resort Headquarters will complete a detailed
traffic, security and emergency plan by the end of the year (Resort). Four parking areas with
The Positioning of an International World Class Park and Resort in order to Create Disney Magic

32
attached green areas will be built around the resort. Parking areas will have sufficient lots so
visitors can choose various methods to get to the resort, including: subway, taxi, special bus lines
and private vehicles (Resort). The Shanghai Disney Resort has made plans with the Shanghai
government to coordinate the Metro, taxis, public and tourist buses and parking lots (Resort). At
peak times, visitors will be directed to other facilities around the resort (Resort). Disney has
coordinated with the Municipal Bureau of Planning and Land Resources to plan the other
supporting facilities, including commercial and visitors service centers, near the entrances to the
park (Resort).
The Walt Disney Company and the Industrial and Commercial Bank of China Ltd.
(ICBC) have entered into a multi-year strategic alliance to create unique products and services
(ICBC). ICBC is the largest bank in the world by profit and market capitalization and one of the
most respected brands in China (ICBC). As the exclusive "Official Retail Bank Participant" of
Shanghai Disney Resort, ICBC will provide a number of retail banking products and services to
the resort and its guests, from full-service ICBC ATMs located throughout the Resort to
commemorative Shanghai Disney Resort coins (ICBC). To the agreement ICBC will have
exclusive integrated brand presence in the Garden of the Twelve Friends, 12 mosaic murals, each
depicting the 12 signs of the Chinese zodiac using famous Disney characters, located in the
beautiful 11-acre green space at the center of the park and in front of the Enchanted Storybook
Castle (ICBC).
The Walt Disney Company, PepsiCo, and Tingyi Holding entered in a multi-year
strategic alliance establishing both companies as the primary beverage suppliers to the resort
(Shanghai). PepsiCo is a global food and beverage leader with net revenues of more than $65
billion and a product portfolio that includes PepsiCo's carbonated soft drinks, as well as
The Positioning of an International World Class Park and Resort in order to Create Disney Magic

33
Gatorade, Tropicana and Aquafina-branded beverage products, which generate more than $1
billion each in annual retail sales and are loved throughout the world (Shanghai). Tingyi Holding
Corp. is China's leading food and beverage company that specializes in the production and
distribution of instant noodles, beverages and baked goods; Tingyi Holding's Master Kong-
branded ready-to-drink tea, bottled water and Chinese traditional juice are leading brands in each
category (Shanghai). Both companies will provide a wide variety of well-known, high quality
PepsiCo and Master Kong beverage soft drinks and ready to drink tea for resort visitors, develop
high impact co-marketing campaigns (Shanghai). PepsiCo will also be developing innovative
beverage equipment (Shanghai). Shanghai Disney Resort will also look to leverage PepsiCo's
Asia R&D Center in Shanghai to develop unique menu items through culinary innovation
(Shanghai). To the agreement PepsiCo and Tingyi Holding will also have an integrated brand
presence in key locations and experiences within Shanghai Disney Resort (Shanghai).
Community and Environmental Work
The Shanghai Disneyland Park and Resort is working with local non-profit
organizations in the China community (Disney).
The Disney VoluntEARS program and Shanghai Disney Resort cast members volunteer
at local charities and organizations (Disney).
On November 9, National Fire Prevention Day, the Shanghai Disney Resort community
relations team, with the Shanghai Fire Prevention Bureau, and the support of the Shanghai Fire
Bureau, bought the "Safety Smart Program" event to children at Shanghai Juyuan Experimental
School (SHDR). For the 2013 Shanghai Fire & Security Expo, held November 8 to November
10, Disney screened Wild About Safety Safety Smart About Fire, a special Chinese language
animated educational film, co-produced with the Underwriters Laboratory, (SHDR). Disney was
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34
able to engage more than 250 young students to watch the film, and play fire prevention games
and activities (SHDR).
Shanghai Disney Resort VoluntEARS created Happy World a Disney-inspired room
for fun activities. VoluntEARS pay regular visits the children in treatment and recovery at the
hospital (VoluntEARS). For International Volunteers Day, Chairman of Walt Disney Parks and
Resorts, Tom Staggs, joined a group of Shanghai Disney Resort VoluntEARS on a visit to the
Shanghai Children's Medical Center to help the hospital's young patients beautify the room with
Christmas and New Year festive decorations (VoluntEARS). Mickey and Minnie Mouse, along
with holiday gifts made a surprise appearance at the event (VoluntEARS).
Shanghai Disneyland has successfully carried out Chinas largest environmental
evaluation and treatment of polluted earth (Resort).
The Shanghai Disneyland Parks and Resort have treated 40,000 square meters of their
park land, planted more than 10,000 trees collected from across China, and filled 200 creeks on
site (Resort). The Shanghai Disneyland Parks and Resort efforts towards environmental
protection have brought in global standards that also combine well with local practices (Resort).

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35
CONCLUSION
Conclusion
In order to understand the positioning strategy of Disneyland Shanghai, we have
reviewed the history of Walter E. Disney and the Walt Disney Company, current Walt Disney
World Class Parks and Resorts and their respective operating markets, and finally Disneyland
Shanghai and the Chinese operating market. Will the Walt Disney Company establish a
positioning strategy that allows them to successfully to build the Disney brand in Mainland
China?




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36
CLASS NOTES


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Summary Review
The following case study is an international marketing report on the positioning of
Disneyland Shanghai. In order to understand the positioning of the most successful international
entertainment company in the world, as well as the new Disneyland Shanghai parks and resort,
we present an overview of the following:
Walt Disney and the Walt Disney Company
Walt Disney World Class Parks and Resorts and the Operating Markets
Disneyland Shanghai and the Chinese Market
Intended Objectives
The following case study is an international marketing report on the positioning of
Disneyland Shanghai in order to meet the following objectives:
Determine the company value or the consumers perceived value within the context of
the competitive Chinese entertainment parks and resorts market.
Define the position of the Walt Disney Company and Disneyland Shanghai
Formulate recommendations to improve the Walt Disney Company and Disneyland
Shanghai positioning strategy
Discussion Questions
What is the Walt Disney Company brand? What is the value of Walt Disney Company?
The Walt Disney Parks and Resorts are the international beacons for the Disney Brand
(Walt). The Walt Disney Company has continuously innovated and expanded their parks and
resorts, creating memories and dreams for families worldwide (Walt). The Walt Disney
Company is recognized as the worlds most reputable and admired entertainment company, a
leader in international entertainment and media enterprise, and the destination for parks and
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38
resorts (Walt). As a global competitor, the Walt Disney Company harnesses technology in order
to enhance the experience of visitors (Kotabe 17). The Walt Disney Company has also invested
in MyMagic+ bands (Walt). Now implemented at Walt Disney World Resort, the Walt Disney
Company is expanding their presence at Disney parks and resorts (Walt). The bands are not only
a convenient option for guest and the ark, allowing guest to utilize the bands as park tickets,
hotel keys, and payment method (Walt). The MyMagic+ bands allow Walt Disney to control
traffic for guest, rides, and attractions increasing park capacity and attendance, and the
convenience as a payment method increases consumer spending (Walt). The Disneyland
Shanghai improvements in management standards and domestic construction and the Walt
Disney Companys knowledge and skills will serve as an advantage in the Chinese theme park
market (Resort). Overall, the Walt Disney Company has a technical and brand advantage
compared to local theme parks (Tiangyu). A China native, Wu, 15 years old talks about some of
these other theme parks, "in some theme parks, the equipment is too old, the food there is
terrible and expensive. The souvenirs are almost the same in every Beijing park: panda dolls,
plastic swords and garlands. They are so boring." The 15-year-old, Wu is also fan of thrill rides,
prevalent in the United States culture (Tiangyu).
What difficulties will Walt Disney face in establishing their brand? How will this affect
their theme parks? What is the Walt Disney Company plan to combat this?
The Walt Disney Company will also face competition in establishing its brand and
releasing Disney branded movies (Reuters). The Dalian Wanda Group has signed agreements
with film studios and talent agencies to have about 30 foreign movies produced at the new
facility every year, as well as 100 local films (Brzeski). Additionally, Viacoms Paramount
Pictures and DreamWorks Animation SKG have hired Chinese actors and set up co-productions
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with Chinese firms (Reuters). The Walt Disney Studios has been the foundation on which the
Walt Disney Company and Walt Disney Parks and Resorts (Company). Walt Disney's dream of
an immersed storytelling and themed experience was made possible through Disney films (A).
The first of the iconic castles at the center of all of Disney world-class parks and resorts was first
inspired by Sleeping Beautys castle (Walt). Disney films have had a mutual influence in the
design of the parks, themed lands, and attractions (Walt). The success of Walt Disney films in
China is critical for the success of Walt Disney parks and resorts (Walt).
What kind of competition does the Walt Disney Company face in the Chinese market? How
can this hurt the brand image of Walt Disney parks worldwide? What are some benefits of
increased competition?
The Walt Disney Company faces substantial competition from alternative providers of
the products and services the company offers and from other forms of entertainment, lodging,
tourism and recreational activities (Walt). Increased competitive pressures may reduce revenues
or increase costs (Walt). Competition in each of these areas may divert consumers from our
creative or other products, or to other products or other forms of entertainment, which could
reduce our revenue or increase our marketing costs (Walt). Such competition may also reduce,
or limit growth in, prices for our products and services, including advertising rates and
subscription fees at our media networks, parks and resorts admissions and room rates, and prices
for consumer products from which we derive license revenues (Walt). Walt Disney Parks and
Resorts local competitors will attempt to learn and gain an advantage over the Walt Disney
Company (Tiangyu). The competition may benefit Walt Disney Parks and Resorts, attracting
bigger populations (Tiangyu). In Orlando and Anaheim, competition has benefitted Walt Disney
Parks and Resorts, attracting bigger populations with a bigger cluster of attractions (Einhorn).
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Therefore the success of Macau and Hengqin, as well as other resorts may prove to benefit
Disneyland Hong Kong, Just as Disneyland Shanghai will after 2015 (Einhorn).
How is the Walt Disney Company integrating with the Chinese market and Chinese
culture?
The Walt Disney Company has utilized their alliances or partnerships to gain access to
the market and market knowledge (Kotabe 18). The Walt Disney Company lacks certain skills
and knowledge that are critical for the success (Kotabe 275). The lack of information of the
right kind is the most critical hurdle in developing a marketing plan (Kotabe 524). This includes
knowledge of Chinese culture and the diverse customer preferences of the Chinese market
(Kotabe 524). Under the Walt Disney Company and Shanghai Media Group strategic alliance,
the companies will co-produce Disney branded films to be release to the Chinese market.
However, under the Walt Disney Company and Shanghai Media Group agreement, both
companies will co-own the copyrights. The strategic alliance is not as demanding on the Walt
Disney Company and overall is beneficial due to the lack of resources and investment in China
(Kotabe 278). The strategic alliance lowers the Walt Disney Companys exposure to political or
economic instabilities in their foreign markets (Kotabe 278). It also allows the Walt Disney
Company to navigate around import barriers or get access to markets that are completely closed
to imports, or favor licensors (Kotabe 278). The Walt Disney Company licenses the Disney
brand in exchange for royalty fees, allowing Disney to penetrate the market (Kotabe 277).
Additionally, licensing allows for better navigation around China's strict political restrictions of
34 foreign films annually, and guidelines for nudity, violence and politically sensitive scenes,
which have made it difficult for Western filmmakers and studios to enter Chinas entertainment
and media market (How). However, a partner, or licensee may fail to properly manage and
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41
market the Disney product (Kotabe 278). The Walt Disney Company must be cautious and
research their potential alliances and the terms of use (Kotabe 278).
What is the position of the Walt Disney Company and Disneyland Shanghai?
The Walt Disney Company has developed a unique selling proposition for Disneyland
Shanghai, in order to market their value as a company and their value against competitors
(Kotabe 219). The positioning strategy should highlight that value, and what has come to create
Disneys magic (Kotabe 220). Disneyland Shanghai is positioned as a world-class resort
designed for culture, family, and community that continuously imagines and innovates to create
experiences immersed in signature interactive storytelling and imagination.
What recommendations would you offer to the Walt Disney Company and Disneyland
Shanghai?
The following are recommendations for the positioning strategy of Disneyland Shanghai
based on the history, analysis, and conclusion of the Walt Disney Company.
The release of Disney branded content, specialized Disney branded content, and content
in partnership with the Shanghai Shendi Group are all avenues the Walt Disney Company should
explore. The Walt Disney Company has export marketed Disney branded content internationally,
and is recognized as the worlds most reputable and admired entertainment company (Kotabe
17). Consumers in developing countries, with access to satellite communications and
information, like many consumers in developed countries, are familiar with global brands
(Kotabe 6). These consumers have developed a tremendous pent-up demand for products by
multinational companies (Kotabe 6). Local consumers and culture are liberated from the
ideological conformity of nationalism (Kotabe 1). Even in the most deeply rooted cultures,
consumer needs have converged (Kotabe 9). However, the divergence of consumer needs and
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42
cultural preferences exists at the same time (Kotabe 10). The Walt Disney Company has released
special editions of Walt Disney Studio films (Walt). Iron Man 3 was released to the Chinese
market, featuring Chinese actress Fan Bingbing, and actor Wang Xueqi (Walt). Disneyland Hong
Kong is launching the Iron Man Experience in 2016 (Einhorn). The results of the film had mixed
reviews (Walt). Overall, the release of Iron Man 3 shattered box office sales in the Chinese
market and international total ticket sales were over 4.7 billion (Walt). However, local
customization should receive priority attention in serving Asian markets (Kotabe 20). Products
must be tailored according to local preferences (Kotabe 20). Asian consumers can no longer be
persuaded to buy into existing products with slight adjustments (Kotabe 20). Currently the Walt
Disney Company is beginning to engage in multi-domestic marketing, in a partnership with the
Shanghai Shendi Group (Kotabe 17). The Disney subsidiary develops, manufactures, and
markets films in the local market (Kotabe 18). For example, MTV has more than 150 TV
channels, in 162 countries, in 33 languages, and a large part of its local channel contents are
made locally (Kotabe 4).
The use of sales promotions to launch Disneyland Shanghai does not position the Walt
Disney Company as a value option (Kotabe 587). The Chimelong Group provides for park
visitors tourist packages for to Hong Kong and Macau Casinos (Einhorn). The Chimelong Group
had the highest attendance in Asia for waterparks in 2012 (Einhorn). Though, well-established
brands can sometimes use promotions to help infiltrate a competitive market, when targeting mid
to high range consumers, Disney should be cautious with promotions, especially, due to it
primarily being used by smaller companies and the overuse of promotions and deals could
stigmatize the brand by cheapening the brand image (Kotabe 587). Traffic triggered by such
deals comes mostly from low-loyalty buyers who are unlikely to return to the brand in the
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43
absence of deals (Kotabe 587).
Investing in innovation and technology is imperative for the Disneyland Shanghai in
order the Walt Disney Company to maintain its position as a leader in innovation and technology
(Walt). The Wanda Company has plans for 10 cultural tourist destinations with entertainment
and shopping outlets, and developments that will reflect the local culture of the region (Brzeski).
Chairman Wang, of the Wanda Company signed a deal with the city of Wuxi, just west of
Shanghai, to build a $5.9 billion cultural tourism city (Brzeski). Furthermore, mega-development
projects or Wanda Cities are being developed in Haerbin, Nanchang, Hefei and Qingdaom,
Beijing, Guangzhou, and Dalian (Brzeski). The Chairman has made it clear he plans for the
destination to surpass Disney in both revenue and number of visitors (Brzeski). Wuxi Wanda
City will span 296 acres around a small lake, and include an outdoor amusement park, a film
city with 3D cinemas, an indoor childrens theme park, an extreme sports hall, seven resort
hotels, a commercial center with over 200 retail shops, and a bar street of at least 20 venues
(Brzeski). When Wuxi Wanda City will be open in 2016, Disneyland Shanghai will have to
directly compete with their technology, innovation, and knowledge of the Chinese market
(Brzeski). Other competitors include the OCT group, which has been recognized for their
educational childrens attractions, the Happy Magic Water Cube and Olympic Water Cube
Indoor Water Park, which after one year after opening, established themselves as leaders in the
industry with 968,000 and 605,000 in attendance, respectfully, It is imperative that the Walt
Disney Company maintains its position as a leader in the Chinese market and globally. Walt
Disney himself, Disneyland will never be completed. It will continue to grow as long as there is
imagination left in the world (Walter E. Disney).


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APPENDIX


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Portfolio Analysis to Determine Company Value

The following is a portfolio analysis to determine the segmentation of products/services
based on marketplace demand and volume, showing that market resources may be best allocated
to Asian markets whose attendance has been low, but do have the highest potential growth in
demand (Kotabe 219).





Walt Disney World
HK

Tokyo
Disneyland
Paris
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Environmental Analysis to Determine Company Value
The following is an analysis of the socio-economic, legal/regulatory, technological,
political, competitive environment of the Walt Disney Company (Kotabe 219).




Disneyland
Shanghai
Socio-Economic
Strong Economy
Legal/Regulatory
Copyright Laws
Licensing
Technological
Less Advanced
Poltiical
Difficult Entrance for
Foreign Entertainment
Companies
Competitive
Unsaturated Market
Fierce Global and
Local Competition
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47
Competitive Analysis to Determine Company Value
Customer decision criteria are based on the following customer decision criteria: the park
quality and investment, incorporation of Chinese culture and understanding of Chinese market,
and overall brand presence and appeal (Macleod). This will determine the current perceptions
held by consumers about the Walt Disney Company and the competition (Kotabe 219).





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SWOT Analysis to Determine Company Value
The following is a SWOT analysis to determine the strengths, weaknesses, opportunities,
and threats of the Walt Disney Company (Kotabe 219).






Strong Economy
Unstaturated
Market
Strategic Allainces
Foreign Market
Fierce Global and
Local Competition
Copyright Laws
Licensing
Lack of Knowledge
of Chinese Market
Difficult Entrance
Brand Name
Advanced
Technology
STRENGTHS WEAKNESSES
OPPORTUNITIES THREATS
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