Global Marketing Plan for Disneyland in Qatar - Case Study Example

?Running Head: DISNEYLAND IN QATAR Topic: Lecturer: Presentation: Executive Summary This report highlights the internal and external situations of Walt Disney Company’s theme park. Some important aspects of the internal situation have been discussed; including the company structure, product line, current market as well as the company’s distribution and supply chain. On the external situation, significant aspects such as competitive environment, the global market as well as economic, technological, political, socio-cultural and natural factors have been subjected to a PESTEL analysis. A SWOT analysis for the product line has been presented. The strategic fit of the market opportunity to the company’s capabilities has been highlighted. The report ends with the identification of a market opportunity in the Qatari market that is worth pursuing, which becomes the stated objective of the global marketing strategy plan. Introduction For organizations to maintain competitiveness, they need to adapt to the diverse needs of customers as well as the communities within which they operate. Foreign investment is a costly move that requires a large capital outlay. An organization has to set strong marketing strategies to enhance its survival. It is important to evaluate the important aspects of the internal environment that may influence success such as the organizational structure, the product line which is the theme park in this case, the status of the market, as well as the distribution and supply chain. Moreover, assessment of the external environment is significant in the planning process especially when the organization plans to venture in to the global market. The PESTEL analysis helps managers to set strategies to cope with challenges in the operating environment. The SWOT analysis helps managers to capitalize on their strengths to utilize available opportunities as well as to realize the weaknesses that need to be addressed. It is also an important planning tool for establishing potential threats in advance. These analyses will be significant in determining the strategic fit of Disney to establish a theme park in the emerging Qatari market. Internal Situation Company Structure Walt Disney Company operates in a functional structure with several affiliates and subsidiaries in different countries globally. The various sections include; theme parks, resorts, media networks, amusement studios, consumer goods and interactive media services. These sections provide different products under centralized management. Disney’s theme parks control a wide resource base with regards to materials that are significant in generating value for customers (Keller, 2001). Tangible assets are supplemented by intangible assets such as a strong brand name, brand equity, patent rights and customer loyalty. Each resource is uniquely positioned to serve a particular group of consumers and hence difficult to imitate. Disneyland was able to strategically develop capabilities that can be utilized in a competitive environment, for example, copyrights have helped in the retention of profits for every character in its studios (Capodagli & Jackson, 1999). Disney’s Theme Park The theme park comprises of mainly entertainment attractions and rides suitable for family leisure. The theme park entertainment is suitable for adults and children. Generally, creativity management has been significant in the success of Disney’s theme parks (Mulcaster, 2009). The theme park strategy was developed in 1952 and took advantage of the tremendous impact of television in awareness creation among consumers. Since then, the eleven theme parks have been established globally mainly in the US, Europe and Asia. Innovation and target oriented approach have significantly contributed to the growth of the Disney theme parks (Wasko, 2004). Current Market for the Theme Parks The current market for Disney’s products is based on people’s willingness and ability to spend on entertainment and leisure. The theme parks offer products that can not be classified as basic. Nevertheless, there is increasing awareness regarding the significance of leisure and entertainment to the general well being of people, especially those involved in stressful work. There has been rising need for families to spend time out of their homes to relax their minds and to engage in recreation as a way of strengthening relationships (Kim, 2004). This trend positively affects Disneyland theme park’s market by increasing demand for leisure and entertainment services. Customer behaviors have been significant to the organization’s creativity management whereby innovations are integrated in the business processes for purposes of consumer satisfaction. In 2010, the gross profit of the theme parks reached a high of USD 11 billion. This is an indicator of the significance of Disney parks thereby justifying the bid to enter the unexploited Qatari market (Wasko, 2004). Distribution and Supply Disneyland theme parks’ supply chain is strategically developed to act in response to varied consumer and guest requirements. Significant assets have been positioned to maintain the parks’ supply chain engagements globally (White, 2004). Plans to open the theme park in Qatar are expected to succeed especially through leveraging the existing supply chain services in Asia to maintain the new park. The company encourages initiatives by the various theme parks such as the adoption of a holistic strategy to supply chain management and the electronic combination of their supply base. They are also motivated to rationalize the supply chain system and the application of the total cost strategy to sourcing (Capodagli & Jackson, 1999). External Situation Competitive Environment Disneyland parks operate in a globally competitive market with challenges emanating from economic crises in the global markets. Nevertheless, the company’s strong brand has been significant in maintaining profitability. The theme parks are cost effectively advertised through the Disney media networks and hence the global popularity. The positioning strategy ensures that the needs of different market segments are effectively satisfied. In other words, the theme parks provide entertainment and joy rides for customers from diverse socio-cultural backgrounds and ages (White, 2004).. The application of business-to-business strategies has been significant in promoting the organization’s competitiveness. The Global Market The company’s operations in the global market have increased significantly, expanding from the first park Disneyland in California to the second park, Walt Disney World in Florida, the third park, Tokyo Disney in Japan, fourth park Disneyland Paris and the fifth Hong Kong Disneyland. Plans for Disneyland to venture in the Qatari market are in the offing. The Disney theme park is one of the significant assets that attract millions of people due to the perception generated through advertisement as clean, family friendly and creatively designed park (Becker-Olsen et al. 2006). Even though a visit to the park might be expensive and the place crowded as a result of many customers, people prefer to capitalize on the positive aspects and are often ready to spend some money for a family visit to the park. This attraction is attributed to the strong brand name, even though some major drawbacks have faced the company, such as the reduction in profits for Disneyland Paris in 2009 due to economic crunch that lowered the number of customers. However, the theme parks in Paris and Hong Kong are likely to expand as the economies continue to stabilize (White, 2004). PESTEL Analysis Economic Factors Global expansion is supported by economic strength of the host nation. Disney’s theme parks are established in strategic locations globally in terms of economic stability. According to Wasko (2004), Disney has strategically positioned theme parks in economies that are considered to be strong in a global perspective. The parks are situated at California and Florida in the US, which is a significant global economic power, Paris in France, which is a thriving economy, Tokyo in Japan; a developed and stable economy as well as Hong Kong in China which has made tremendous growth in the last decade. As Al-Rumaihi & Hindi, (2004) observe, Qatar is among the best performing economies in the Middle East with a constant growth rate of 6.5% over the last five years and hence the possibility of the theme parks thriving in the country. Political Factors The US, France, Japan and China are among the global economies whose stability is encouraging to investors. They have been striving to develop the tourism industry which is a major source of revenue for public expenditure. Qatar also enjoys political stability and therefore it presents a friendly investment climate for a Disney park. Nevertheless, regional political instability in the Middle East may raise concerns with regards to the future of the park (Kroll et al. 1999). Socio-Cultural Factors The American culture is associated with entertainment and holidaying. Paris and its suburbs are also known for leisure. However, Disneyland Hong Kong was faced with difficulties to establish in the region until the American approach that was used initially was changed to a more localized approach through reduction in prices, adopting a local custom for handling visitors, change of furnishings and decorations as well as the application of local labor practices. These changes made it possible for the theme park to establish in Hong Kong (Matusitz, 2009). Studies indicate that Qatari people spend about 11% of their earnings on dining and entertainment (Supreme Council for Family Affairs, 2004). This is a significant opening for Disneyland to venture in the Qatari market. Islam is the official religion in Qatar and therefore special considerations have to be made with regard to the nature of products (Al-Rumaihi & Hindi, 2004). For example, animations of pigs may not be used while various entertainment strategies have to be developed with consideration of the local culture. Technological Factors The theme parks are run under strong creativity management principles and utilize emerging technologies to maximize consumer satisfaction. The infrastructure of the theme parks is developed from a state of the art design to ensure maximum satisfaction. Moreover, establishment in developed countries such as the US, France, Japan and China allows technological transfer to enhance customer satisfaction (Kroll et al. 1999). Environmental Factors The theme parks contribute to the Disney annual environmental reports detailing its efforts to conserve nature through reduction of green house gases emission, fossil fuel use and solid waste. Generally, Disney theme parks are recognized as clean and environmental friendly. Disney’s Animal Kingdom in the Walt Disney World Florida is a significant home for 1,700 animals (Wasko, 2004). SWOT Analysis of Disney’s Theme Parks Strengths The Disney parks are globally standardized and hence acceptable by customers in the global market. Customer focus in product development has promoted attraction of a large consumer base in the emerging markets. The strong brand name is a significant strength for the company to establish in a new market such as Qatar. Product differentiation significantly contributes to satisfaction of the needs of a wide range of consumers and hence greater competitiveness even where other players in the industry have already established (Grant, 2002). Weaknesses Overcrowding in Disney theme parks remains a major challenge that is likely to thwart efforts to maintain a great market share. Moreover, each of the five major theme parks contains several smaller parks under centralized management (White, 2004). This may present a challenge in the effective management of the theme parks, which may also be the cause of overcrowding. Opportunities Disney theme parks have a significant opportunity for expansion in to the emerging economies. They are uniquely developed to serve a wide range of consumer needs and hence the great possibility to increase growth through establishing new theme parks in more states within the US as well as in other thriving economies such as Qatar (Kroll et al. 1999). Threats There are certain risks that can not be overlooked in the efforts towards global expansion. Even though there are many promising opportunities for global expansion, economic and political stability are significant for success of the theme parks in foreign markets. Change of regime or the occurrence of an economic crunch may be detrimental to the realization of the potential opportunities (Becker-Olsen et al. 2006). Strategic Fit of the Market Opportunity to the Company’s Capabilities Disney theme parks offer a wide range of entertainment products such as joy rides, amusement studios as well as interactive media. The high product differentiation is likely to promote the company’s competitiveness in the new Qatari market. Disney is strategically fit to take advantage of the opportunity, especially due to its vast resource base and the strong Asian supply chain that can be reinforced to promote Disneyland in Qatar (Kroll et al. 1999). Market Opportunity There is an opportunity in the dining and entertainment in Qatar in relation to the willingness of the Qataris to spend their income on leisure and amusement. There is no possible competitor equivalent to the company and with the current creativity management strategies it is easy to take advantage of the opportunity (Al-Rumaihi, F. & Hindi, 2004). Disneyland needs to develop a global marketing strategy plan that can promote its operations in the Qatar. Conclusion Walt Disney Company has several affiliates and subsidiaries in 40 countries globally. The company controls a wide resource base and a popular product line comprising entertainment, leisure and consumer products. The company’s market depends on the willingness and ability of people to spend on its products. The supply chain is developed to respond to customer demands. Economic crises are major threats to the success of the company in the global market. The strong brand name has been significant in the maintenance of competitiveness. Qatar is one of the emerging opportunities globally that call for the development of a global marketing strategy plan. References Al-Rumaihi, F. & Hindi, N. M. (2004), “The transformation of Qatar economy into industrialization era”, International Journal of Economic Policy in Emerging Economies, Vol. 4(3) pp 245-273 Becker-Olsen, Karen L., Cudmore, B. Andrew, and Hill, Ronald P. (2006), “The impact of perceived corporate social responsibility on consumer behavior”, Journal of Business Research, Vol. 59(1) pp. 46-53. Capodagli, B. and L. 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(2004), “Understanding Disney: The Manufacture of Fantasy”, Canadian Journal of Communication, Vol 29(2) pp. 263-264 White, C. (2004), The trials of EuroDisney: Strategic Management. Basingstoke: Palgrave Macmillan. Read More