The paper "Factors that Contributed to EuroDisney’ s and Hong Kong Disney’ s Poor Performance" is a perfect example of a marketing assignment. More often than not, a significant number of organizations make tragic marketing mistakes that adversely affect their profitability. Principal among these mistakes is the failure to understand the nature of business as well as the features of the industry in which they operate. Moreover; poor planning and incompetence in the management of these organizations also play a crucial role in slowing the growth rates of these organizations. However, when all these factors change and the organizations are under competent and able management, the overall performance of these organizations significantly increase thus creating a remarkable impact in their respective industries across the world.
EuroDisney Park serves as an excellent example of an organization that got it wrong in its operations thus adversely affecting its profitability. EuroDisney Park is an entertainment resort that began its activities at tea capital city of Paris in the early 90s. The park was a subject of debate and controversy. A significant number of the critiques were French people who were not comfortable with the invasion of their culture by the American culture via the resort.
In particular, they deemed a significant number of the practices at the park to be cultural imperialism because the culture at the park was American oriented. The controversy worsened with the fact that top management on the park was heavily from America yet it operated from France. These and other factors triggered strong opposition from the local people as they openly discouraged the local population from going to the park to receive services.
They attacked the park terming it to be insensitive to the cultural diversity that existed across the world. In particular, the employment policy embraced by the management of the park then discouraged against the French people, and this was not taken lightly by many French people (Kaynak et al). The fact that the local people were discouraged from going to the park adversely affected the profitability of the resort in the long run. However, management of the resort made frantic efforts to rescue the collapsing resort by embracing new management and employment policies.
The resort significantly increased its customer base after a major management overhaul. The resort has expanded to other countries where it has made considerable achievements in the recent past. Qestion. 1: Factors that contributed to EuroDisney’ s and Hong Kong Disney’ s poor performance during its first year of operation It is evident that the EuroDisney Park and Hong Kong Disney parks experienced poor performance during their first years of operation. The fundamental reason for the poor performance of EuroDisney Park is because it embraced the wrong market entry strategy.
The marketing managers failed to do enough market research to understand the features of the new market they wanted to venture into. In particular, the park got it wrong in its pricing policy. T6he prices of the services and products that EuroDisney Park offered were slightly higher compared to other parks in the same market. This not only discouraged the new customer from visiting the park but also made their customers prefer other parks due to the cheaper prices offered. Moreover, the management of the park failed to diversify their operations to meet the expectations of different people with different backgrounds.
The fact that American culture dominated the park adversely affected customer turnout at the park because other people with different cultures to disassociate themselves with the park. Moreover, the local people were not involved in establishing the business model of the park, and this made it hard for them to embrace the park. These factors adversely affected the customer turnout at the park thus leading to low profitability. The Hong Kong Disney Park also experienced significant challenges during its early year of operation.
The factors that contributed to the dismal performance of the park include the massive initial cost outlay with little revenue generation during the first and second year of operation. The park managers failed to meet the revenue projections to cover the costs that they had incurred during the first year of operation. Consequently, the Hong Kong Disney Park found it difficult to meet its operational costs during the first year of operations and this adversely affected the profitability of the organization. Moreover, the entry strategy embraced by the management of Hong Kong Disney Park was not useful in that it lacked a competitive advantage over the other parks that were already operating in the market.
The park was offering almost similar services that its established competitors were offering, and this made it be an underdog in the industry. These factors adversely affected the profitability of the parks’ operations during the initial years of operation. Question 2: Extent to which the factors were foreseeable and controllable.