EURO DISNEY

Reasons behind the failure of Euro Disney –

 Over optimism. Arrogant attitude – “we have made it, so people will come”
 Location – Euro-Disney was close to the city of Paris and highly accessible. Visitors
were not using hotel accommodations as per Disney‟s expectations – only 55% were
occupied
 High loan amount – 43% clear from the investment
 Disability to handle cultural diversity
 Economical conditions – Euro Disney started at the time of severe recession in Europe.
 High prices of accommodation facilities and other articles. Food was also costly
 Operational errors and miscalculations.
 Breakfast wasn‟t given importance and alcohol was banned – two things which are
integral part of French culture.
 Employees were not well trained. Lack of Language knowledge and cultural
understanding.
 Management didn‟t allow CEO to change policies - “Europe is not America”
 Unable to have a consensus between reality and desk-plan.

SWOT analysis

Strengths –

 Strong brand name

 Rich experience in the field
 Financial backup because of brand
 Government support – infrastructure and land

Weakness –

 Miscalculations about finance and culture

 Insufficient training to employees
 Over pricing
 Over confident about policies and strategy

Opportunities –

 Learn to understand and adapt Europe‟s environment

 Use of government support in a better way
 Renew pricing policies in all segments
 Concentration on the “European citizen”
Threats –

 Getting discarded by citizens

 Over spread of company stock
 Withdrawal of government support in the form of infrastructure
 Competitors and new entrants
 Economical problems

Roger‟s Model –

Relative advantage – high. Experienced organization in the field. Enjoyed success stories in USA
and Tokyo

Complexity – too complex. Cultural mix in Euro Disney. Many languages, many citizens, many
ways to live

Compatibility – failed. Unskilled employees to handle diversify customers. Unable to assess the
cultural needs of „breakfast‟ and „wine‟

Divisibility – high. Most of the western Europe was covered as the geography of the customer.
Location was accessible to most citizens.

Communicability – high. Initial massive publicity. High customer response.

Things could have been done -

Vast survey about the culture of Euro

pean citizens and their livelihood was an essential step which Disney missed. Their taste and
preferences, wants, customs and interests was ignored. Breakfast, wine & culture mix are the
examples of what happened later on.

The losses made them sell 24% stake to Arab Prince. Company was only able to meet operating
cost.

Proper financial planning would have relieve the company from those consequences.