Walt Disney Company's international expansion: Tokyo, Paris, and Hong Kong

Disney Parks

Why do you think that the world's largest theme park operator, Walt Disney Company, was motivated to establish parks in Tokyo, Paris, and Hong Kong?

Disney Strategic Planning was able to find the optimal mix of income, family composition by key demographics, and favorability of national government to their expansion in each region (Data Monitor, 2004). The one area they had the most trouble with from a cultural and media relations standpoint was Euro-Disney in Paris (Forman, 1998). Disney pressed on however as the potential to attract millions of visitors from the United Kingdom, Germany, Italy and throughout western Europe galvanized their commitment to this market (Kepler, 2005). Tokyo was a completely different experience, with many Disney fans asking for a park to be built there and the per capita income and demographic factors aligning with Disney's most loyal customer bases (Kepler, 2005). Hong Kong is one of the most prosperous regions of Asia and also has an excellent demographic composition for Disney's core marketing and services mix (Fowler, Marr, 2006). These factors led to the rapid development of Disneyland Hong Kong.

2. What particular market characteristics of each of those sites do you think were especially attractive?

Disney's executives and strategic planners considered the Asian market to have the greatest possible growth, and based on their research, chose to expand first in Tokyo where research showed a large and affluent fan base (Kepler, 2005). The decision to expand into Hong Kong was driven by the market size of China and the surrounding regions, their relative level of affluence, and the potential for outside investment to alleviate risk (Fowler, Marr, 2006). For Euro-Disney the primary objective was to have a theme park on the European continent, accessible to those Disney customers in the UK, throughout Western Europe, and across the Eastern European nations. Disney's market research had shown that the majority of these customers were saving up an average of two to three years to visit Disneyworld in Orlando (Kepler, 2005). By having a park in Europe, Disney hoped to increase the frequency with which their customers could visit and spend at their theme parks. Disney considers demographics of each location, affluence of the population, distribution of age groups within the population, level of support from national governments, tax implications and potential for growth (Kepler, 2005). All of these factors supported the decision to create Disneyland Tokyo, Hong Kong and Euro-Disney outside of Paris.

3. If you were the CEO of the Disney corporation, would you establish additional foreign parks, and if so, when, where, why, and how? If not, please state in detail the rationale for your decision.