BMG306/03 Introduction to International Business Case Study WOU Malaysia In April 1992, EuroDisney first opened in Paris, France It later changed its name to Disneyland Paris

University Wawasan Open University (WOU)
Subject BMG306/03 Introduction to International Business

In April 1992, EuroDisney first opened in Paris, France. It later changed its name to Disneyland Paris. They expected to achieve the same tremendous success that they had achieved in Tokyo Disneyland. However, EuroDisney in Paris failed in its first few years. Financial losses were so heavy that the president had to structure a financial rescue package to put EuroDisney on firm financial ground. Among the reasons for the failure was the issue of culture.

The French visitors were expected to make up 50% of the attendance figures but they stayed away. The French viewed EuroDisney as American imperialism. They also did not like American fairy-tale characters and were proud of their own lovable cartoon characters such as Asterix and Obelix who had their own theme park nearby.

Advertisements emphasizing the size of the park and the glitz rather than the variety of the rides, the entertainment value and the attractions offended the French sentiment. Expensive trams were built along the lake to transport guests from the hotels to the park but the guests preferred to walk.

The American managers of EuroDisney further offended the local banks, the advertisement agencies and other organisations with their seemingly arrogant attitude. The Disney management decision to ban alcohol in the park proved to be insensitive to the local culture because the French are the world’s biggest consumer of wine. To the French a meal without wine is unthinkable, so Disney lifted the ban on alcohol. Mistaken assumptions by Disney management team affected construction design, marketing and pricing policies and park management as well as initial financing. Disney executives were wrongly informed that Europeans do not eat breakfast and based on that the breakfast service was drastically reduced and this upset the hotel guests terribly.

Americans usually take their families for short holidays but the vacation customs of Europeans were different. Europeans prefer to take a month-long family vacation during summer and they would not want to spend the entire time in a theme park. This also contributed to financial losses. As many French people like to take their pets with them on vacations, Disney built special kennels to house visitor’s pets during their stay at the theme park.

Frenchman Philippe Bourguinon took over EuroDisney as CEO and managed to navigate the theme park back to profitability and dealing effectively with local banks and other agencies. He changed the marketing strategy to focus more on localization and taking into account the different tourists’ habits around the European continent. The name EuroDisney was also changed to Disneyland Paris.

More changes were put into place, such as providing full breakfast that caters to the multiple cultures that exists throughout Europe. Unlike Disney’s initial attitude, they realised that not only guests needed to be respected and welcomed on the basis of their own culture and travel habits but also the need to deal with local agencies and organisations with respect for the local culture.
(Source: adapted from Cateora and Graham, International Marketing (2016),15th edition Mc Graw Hill)

Question 1

Analyse the cultural differences that contributed to the initial failure of EuroDisney.

Question 2

Discuss from the cultural aspect how EuroDisney turned around its initial poor performance in France.

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