This paper analyzes the marketing strategies developed by the Walt Disney Company for the Shanghai Disney Resort, a major international expansion project in China. Beginning with background on the resort's history, investment structure, and ownership, the paper examines each element of the marketing mix: product strategies integrating Chinese cultural context, premium pricing decisions, multi-channel promotional campaigns, and place/distribution planning. A SWOT analysis evaluates internal strengths and weaknesses alongside external opportunities and threats. The paper also identifies one notable failed strategy—high pricing that risks excluding lower- and middle-income consumers—alongside several successful strategies, including market selection, differentiation, and phased growth planning. The paper concludes with a critical assessment of the resort's long-term competitive prospects in the Chinese market.
The Shanghai Disney Resort is a major theme park resort built by Walt Disney Parks and Resorts — the fifth major business segment of the Walt Disney Company. Construction began on April 8, 2011, and the resort was targeted for opening at the end of 2015. It would be the company's second Disneyland project in China, following Hong Kong Disneyland, which opened to the public in 2005. The Shanghai Disney Resort was approved by the Chinese Government in November 2009 (The Walt Disney Company, 2009).
The resort is being built in two phases. Phase 1 consists of Shanghai Disneyland Park, a Magic Kingdom-style Park, two themed hotels, an entertainment district, a lake, numerous recreational facilities, and parking and transportation hubs. In the second phase, Walt Disney Parks and Resorts plans to develop two additional theme parks at the resort (The Shanghai Disney Resort, 2013).
The Shanghai Disney Resort will be a destination where visitors come with children, families, and friends to enjoy a wide range of recreational and entertainment offerings. The resort promises to provide a new world of imagination, fantasy, adventure, entertainment, and creativity through its theme parks and deluxe hotels. The major theme park area covers approximately 910,963 square meters (225 acres). The resort will include one deluxe and one value hotel with more than 1,200 rooms in total, along with retail shopping, dining, and entertainment facilities (The Shanghai Disney Resort, 2013).
The land allocated for the Shanghai Disney Resort covers about 963 acres (3.9 square kilometers) in Pudong, Shanghai — more than three times the land covered by Hong Kong Disneyland. The estimated cost for the whole project is approximately 24.5 billion Yuan (US$3.7 billion), with an additional 4.5 billion Yuan (US$0.7 billion) budgeted for other facilities. The Walt Disney Company holds the major ownership share (70%) while the Shanghai Shendi Group owns the remaining 30%. The resort is being constructed through financing from various large-scale public sector enterprises under contracts with a joint venture management company consisting of the Shanghai Disney Resort and the Walt Disney Company (The Walt Disney Company, 2013).
The target market for the Shanghai Disney Resort can be divided into two major segments: a primary target market and a secondary target market. The primary target market consists of children and teenagers aged 4–15 years. The major facilities and offerings of the resort — including the Shanghai Disneyland Park, Magic Kingdom-style Park, Disney characters, gaming and ride systems, storytelling, Storybook Castle, and nightly fireworks — are targeted toward this primary group. The secondary target market comprises youngsters, adults, and older visitors who come to enjoy other recreational and entertainment facilities. In addition to targeting both genders and all age groups from the Chinese market, the company also aims to attract all income groups and social classes. However, the most commercially significant target market will consist of people from upper middle and high income groups.
The Shanghai Disney Resort promises to entertain children and adults through highly imaginative, fascinating, adventurous, and creative recreational facilities. Therefore, its target market consists of people who are family-oriented, vivacious, youthful, and adventure-seeking. The company will also target local and foreign tourists who are entertainment lovers and are always in search of adventurous and entertaining destinations.
Prior to entering the Chinese market with Hong Kong Disneyland, the biggest challenge for the Walt Disney Company was designing product strategies that could best align with the social and cultural values of Chinese consumers. This second project is comparatively less complex in terms of building brand recognition in a culturally different environment, as Hong Kong Disneyland paved the path for the Shanghai Disney Resort to better target Chinese visitors with its innovative, state-of-the-art facilities. Since the Chinese market has had very limited integration of Disney culture historically, Walt Disney Parks and Resorts had to redesign its product strategies in order to achieve success in this market quickly.
The product mix for the Shanghai Disney Resort can be described in terms of its major resort segments and additional entertainment and recreational facilities. In the first phase, Walt Disney Parks and Resorts will build a fully functional Shanghai Disneyland Park, a Magic Kingdom-style Park, two themed hotels, and an entertainment district including Storybook Castle and gaming and ride systems. The second phase will further add two theme parks (The Shanghai Disney Resort, 2013). Beyond these major segments, the resort will also offer entertainment and recreational facilities for children, youngsters, and adults, including restaurants, retail shopping, nightly fireworks, a lake, and live interactions with Disney cartoon characters.
The Shanghai Disney Resort will offer a number of recreational and entertainment facilities, most of which are priced at a level affordable only by upper middle and higher income groups. The most commercially viable target segment therefore consists of well-off families from local and international markets. The preliminary facilities planned for the resort cannot be offered at low prices, as the Walt Disney Company and the Shanghai Shendi Group have invested a substantial amount in the project. In order to earn attractive returns on investment and shorten the payback period, they will charge high prices across all types of offerings — from theme park entrance fees to dining at the deluxe and value hotels.
The Walt Disney Company chose the Chinese market for this international expansion project following numerous positive analyses and predictions about the Chinese economy. The first key reason was the country's large population, which gives the Shanghai Disney Resort the broadest possible customer base. Secondly, living standards among middle and upper middle income groups in China have been rising due to improvements in the country's economic conditions and rapid developments in its industrial and services sectors. The company anticipates that these groups will become increasingly affluent in the near future.
The Walt Disney Company is using various marketing and promotional mediums for the Shanghai Disney Resort. Promotional campaigns have been designed on the basis of benefit-sought segmentation and product-usage segmentation. The company positions the Shanghai Disney Resort as the happiest place on the planet — one that offers a wealth of facilities for all age groups. Amusement parks, live cartoon characters, seasonal flowers, a lake, an imaginative castle, and a refreshing dining experience are all presented as delivering entertainment, leisure, happiness, thrill, and memorable moments.
The major promotional mediums to be used include electronic media, print media, social media networking sites, outdoor advertising mediums, and official and project-based websites such as those of the Shanghai Disney Resort, the Walt Disney Company, and Walt Disney Parks and Resorts. Television and radio can promote the company's products at a massive scale throughout the country and are expected to take the largest portion of the marketing budget (Paley, 2006). Daily newspapers and magazines distributed across cities and towns represent the second major medium. Emerging channels — including interactive websites, social media networking sites, and digital billboards — will also contribute to building brand awareness and attracting potential customers from local and international markets (Clow & Baack, 2009). Finally, physical billboards, transit advertising, and posters will promote the resort in local areas such as the Pudong International Airport, supermarkets, and populated towns.
The Walt Disney Company has planned to target customers from all cities and towns across China. The Shanghai Disney Resort is being built in a populous, well-developed, and economically strong city. In the initial phase, the company set a goal to target every customer reachable within a three-hour drive or railway journey. This means the resort will draw visitors not only from Shanghai itself but also from other developed, high-economy cities across the country.
The supply chain and distribution partners of the company will also play a vital role in making the project successful quickly. Distributors will not only promote the business in potential markets locally and internationally but will also help ensure quality and innovation in every aspect of business operations.
"Internal strengths and weaknesses, external opportunities and threats"
"High-pricing failure and winning strategies of differentiation and growth"
"Final evaluation of resort's competitive outlook in China"
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