Owns and operates:
2.3.3 Finance
Owns and operates:
Walt Disney World Resort in Florida
The Walt Disney Company Case Study
14 FCU e-Paper (2016-2017)
Disneyland Resort in California
Manages and has effective ownership interests:
81% in Disneyland Paris (recapitalization)
47% in Hong Kong Disneyland Resort
43% in Shanghai Disney Resort
Licenses intellectual property to a third party for the operations:
Tokyo Disney Resort in Japan
2.3.4 Marketing
Disney puts a lot of emphasis on marketing to continually attract visitors. The
following were what they effort:
Embrace New Technology
The park has always been quick to embrace technological advantages, like
launching an app to keep visitors informed, or their new MagicBands wearables.
Use Data to Inform Decisions
The MagicBand provides tracking data on all of the park’s guests, which allows
Disneyland to optimize everything from staffing to the location of a food vendor.
Optimize User Experience
Disney always consider customer experience and work to streamline the process
of purchasing, using, and servicing product.
Balance Accessibility with Exclusivity
Design a way to make customers feel special, and they will respond with
customer loyalty.
Deliver Unexpected Moments of Magic
Disneyland capitalizes on this affinity with live characters, surprise performances,
parades, and exceptional customer service. Making an effort to surprise and
The Walt Disney Company Case Study
15 FCU e-Paper (2016-2017)
delight customers at every turn will always pay dividends.
2.3.5 Tokyo Disney Resort
Aging trends in Japan has led to a decrease in TDR’s targeting market, TDR had
to find new ways to appeal to potential customers other than children and young
adults, their original target customers. In order to maintain attendance of its parks and
resorts, TDR attempted to motivate the Japanese population of forty or above, and
defined these people as “New Age”. The “New Age Marketing” targeted guests that
age forty to sixty, promoting that Disney’s parks were not just for kids or young adults.
A separate online homepage called “Disney for Adults” was set up, promoting the 45+
Passport to adults. This passport features services that aimed to bring a more
customized entertainment experience to its adult users. Tokyo Disney Sea (TDS) was
also built to provide a more “grown-up experience” for Tokyo Disney’s older
customers, where they would be less surrounded by “cuteness” such as Mickey Mouse
or its fellow characters.
Mid-Long Term Strategies
TDR had planned out its future strategies, surrounding its core plan of
maintaining a theme park attendance figure of 30 million guest per year. To achieve
that number, TDR aimed to “build stronger family entertainment” and “increase guest
comfort”. Budgets and plans were invested and planned out to be carried out through
the next decade.
The Walt Disney Company Case Study
16 FCU e-Paper (2016-2017)
Chapter 3 Strategic Map
The main objective of Disney Parks and Resort is to create happiness for their
guests, which is supported by three goals: guest experience, telling stories, and family
entertainment.
Figure 2. Strategic Map
3.1 Guest Experience
● Meet and exceed the needs of customers
+ Customer loyalty: loyalty is generated through increasing customer
satisfaction
+ Customizing: customizing customer service allows Disney to meet the
different needs of its different customers: parents or children, young or
elder, and etc.
+ Employee training
The Walt Disney Company Case Study
17 FCU e-Paper (2016-2017)
▪ Regulations
▪ SOP
▪ Attitude: Disney makes sure that its employees share the same
attitude and values as the company
▪ Value sharing
▪ Workload sharing: managers would supervise and help with the
work of other employees, even if it is selling hotdogs or picking
up trash. It all comes down to providing guests the best
experience in the parks.
+ High quality service standard
● Comfortable surroundings
+ Cleaning staff
+ Stroller guy: One simple yet thoughtful service makes guests more
comfortable
● Attendance control: In order to provide the guests with the best Disney
experience, Disney controls attendance number. In which the guest could be
comfortable with the park space, service quality, and plentiful time to enjoy.
+ Ticket price management: The price is much higher than other
amusement parks, especially in hot seasons. Additional payments may
be needed for premium services.
+ Special passports: some passports allows guests to enjoy the rides
without having to wait in the long queues.
● Data Collection
● Embrace new technology
The Walt Disney Company Case Study
18 FCU e-Paper (2016-2017)
3.2 Telling Stories
● Deliver unexpected moments of magic: For example, Disney characters may
show up to entertain the guests in queues, creating an element of surprise.
● Consumer merchandise
● Live characters
● Setting atmosphere
+ Infrastructure
+ Background music
+ Restaurant (and food) designs
3.3 Family Entertainment
● Renew themes and rides
+ Creativity
+ Purchasing popular franchises: Disney acquired popular franchises
such as Marvel and Star Wars, which they can now build new
theme-based rides to attract more guests.
● Parades
● Stage shows
● Photo services
● Cruise trips
● Accessible environment
● Customize packages
The Walt Disney Company Case Study
19 FCU e-Paper (2016-2017)
Chapter 4 Five Forces Analysis
Building on the previous parts we have discussed on Disney’s theme park
segment, Disney Park and Resorts, we continue to look into this case with a critical
eye. Using Porter’s five forces analysis, we studied what kind of external threats that
Disney might have encountered, or would come across in the future. By understanding
more about the industrial environment, the business is in, it helps the company to
navigate its way towards sustainability and success.
Figure 3 Five Forces Analysis
4.1 Industrial Rivalry
For Disney Parks and Resorts, there are four main rivalry in the amusement park
industry, they are Universal Parks and Resorts, Cedar Fair, Six Flags, Cedar Fair, and
Merlin Entertainment. These amusement parks are located mainly in the US, some
expanded abroad globally like Disney itself. Disney also competes with local theme
The Walt Disney Company Case Study
20 FCU e-Paper (2016-2017)
parks in locations outside USA, such as China.
Each of these parks tried to out-perform their competitors in order to attract new
customers and keep their old customers coming back. Ticket prices of these parks do
not differ much from one another, so it would be the differences in themes and
experiences that makes them unique in their own way. New attractions, rides,
infrastructures and restaurants are the keys to making that “sprint” to be head in the
game. For example, Universal added the Harry Potter franchise, the Wizarding World
of Harry Potter, into its parks, and its customer visits sky-rocketed. This success of
Universal stimulated Disney’s expansion of its Magic Kingdom which began in 2012,
over one billion US dollar was invested in order for Disney to maintain its leading
position in the theme park industry.
That being said, Disney Parks and Resorts generate astronomical revenues every
year. As the chart shows, not even if all of its competitors’ revenue added together
could come close to Disney’s massive success. In general, the bargaining power of
Disney’s rivalry would be seen as medium.
Figure 4. Disney Industrial Rivalry
The Walt Disney Company Case Study
21 FCU e-Paper (2016-2017)
4.2 Threat of Substitutes
“Substitutes can be defined as those products or services that meet a particular
consumer need but are available in other market. A substitute product is a product
from another industry that offers benefits to the consumer similar to those of the
product produced by the firms within the industry”.
“The Threat of Substitutes means the availability of a product that the consumer can
purchase instead of the industry’s product”.
In this case of Disney Parks and Resorts we think the Threat of Substitutes is
relatively high for the following reasons:
● Cheaper alternatives to active entertainment, such as: Zoo, Museum, Movie,
Concert, Sports.
Theme parks are meant for active entertainment. Consumers could choose to go
to the movies, park, sporting event or concert, just to name a few, instead of
going to a theme park.
● Disney maintains relevance because of unique experience.
Because Disney theme parks have a distinctive competency of their animated
characters and their family fun rides, consumers cannot get the Disney
experience anywhere else – making Disney relevant.
4.3 Potential Entrants
In Western countries the threat of potential entrants is low. The market of
amusement park is mature with more than 400 amusement parks and attractions in the
U.S. and about 300 in Europe.
Building a new park requires a significant capital. As example $5.5 billion have
The Walt Disney Company Case Study
22 FCU e-Paper (2016-2017)
been invested in Shanghai Disney. In my opinion this the main limitation for potential
entrants as finding such a capital is really challenging. Adding that in the last years
some amusement parks have shown to be unprofitable. So potential investors may
consider putting their money into other businesses.
In China there are many opportunities in the amusement park market however
the competition is already intense with many new theme park projects. So it is
difficult for a newcomer to succeed.
Disney parks have by far the strongest brand and loyal customers. Another
strength that limits the threat of new entrants.