As a young leader in an increasingly competitive job market, I feel as though I gained many pieces of knowledge during this course. Going forward, I hope that I can be more aware of forces that are affecting decisions made by my Company and be able to discuss them amongst my peers. Even though I am young in my career, I have been exposed to many changes at the Walt Disney Company but have not been as in tune with the decisions as I would have liked.
I think understanding the strategy behind Company pricing in the last chapter was perhaps the most eye-opening to me since Disney has always been known for it's pricey cost of admission. As Disney continues to increase its cost on admission, room rates, food and beverage, parking, etc. each year, the pricing chapter forced me to think about the strategy involved as our country recovers from a recession and continues to see the price of gas increase. It may be expensive, but the attendance has yet to slow down which tells me that the price continues to be right.
I am a leader of a very diverse group of people who differ not only in race, but age and gender as well. That being said, I'm very much looking forward to next semester's class surrounding organizational behavior, because I think understanding how to motivate different groups of people is a huge aid to success as a leader in today's business.
Tuesday, May 31, 2011
SECA 11: Globalization
Every year, Walt Disney World attracts thousands for foreign visitors to its resort. Even though there are three Disney resorts in foreign countries (France, Japan, and Hong Kong) and a fourth currently under construction (China), international tourists flood the Orlando area every year. The greatest impact is seen in the British and South American tourists and Disney caters specifically to these two groups in various ways.
For example, this summer Disney will employ several Portuguese-speaking hosts and hostesses whose sole purpose will be to act as translators for our guests visiting from Brazil. These new Cast Members will be strategically placed throughout the parks and resorts in order to help make the language barrier for our Brazilian tourists (who typically travel together in large groups) as minimal as possible.
The effect of tourists from international markets on prices at Walt Disney World is hard to determine.
I say this because even though the Company attracts foreign visitors, at the same time their numbers do not outshine the volume of domestic travelers Walt Disney World will accommodate each year. Disney must therefore find a balance in the price of tickets that is weighted more towards the income of its domestic guests vs. their international guests. For those traveling from Europe, this is great news due to the current strength of the Euro and the steady demise of the US dollar.
For example, this summer Disney will employ several Portuguese-speaking hosts and hostesses whose sole purpose will be to act as translators for our guests visiting from Brazil. These new Cast Members will be strategically placed throughout the parks and resorts in order to help make the language barrier for our Brazilian tourists (who typically travel together in large groups) as minimal as possible.
The effect of tourists from international markets on prices at Walt Disney World is hard to determine.
I say this because even though the Company attracts foreign visitors, at the same time their numbers do not outshine the volume of domestic travelers Walt Disney World will accommodate each year. Disney must therefore find a balance in the price of tickets that is weighted more towards the income of its domestic guests vs. their international guests. For those traveling from Europe, this is great news due to the current strength of the Euro and the steady demise of the US dollar.
Sunday, May 29, 2011
SECA 10:Pricing Strategies
At Walt Disney World, a bundling pricing strategy is utilized. Basically, the longer you stay, the less you pay per day.Think of it as a Costco-style approach, buy in bulk to save!
For example, according to Disney.com, a 1-day ticket for Guests aged 10+ costs $73.80. However, if you purchase a 3-day ticket, the price decreases to $45/day. That's quite a drop off and the price per day continues to decline as you purchase additional days. There are of course, other ticket options that can be added including Disney's Park Hopper (allows you to visit multiple parks in one day), Disney's Water Park fun and more (includes admission to a water park and DisneyQuest Interactive Theme Park) option and the no expiration option (for a price you can make sure you unused tickets are good forever). There are also a wide range of discounts available for Florida residents, AAA members, and the military. However, they all focus around the same simple idea of decreasing ticket prices per day and the length of your stay increases. This helps entice people to stay at our resort for a longer period of time (thus, causing them to spend more money on hotels, merchandise, and food and beverage).
Disney is a price-setter in the Orlando theme park market, and usually will announce increases in ticket prices in August each year. Typically, Universal Orlando and Sea World Orlando wait for Disney to announce an increase in admission prices before announcing their own. This was evident last summer, when on August 4, Disney announced admission increases only to be followed by similar announcements from Universal Orlando and Sea World Orlando on August 6. This competitive atmosphere allows the three major theme park companies in Orlando to benefit from the success each other is experiencing. Since I have been in the industry (January 2008), none of the major Orlando resorts has decreased ticket prices after seeing the other resorts announce an increase.
For example, according to Disney.com, a 1-day ticket for Guests aged 10+ costs $73.80. However, if you purchase a 3-day ticket, the price decreases to $45/day. That's quite a drop off and the price per day continues to decline as you purchase additional days. There are of course, other ticket options that can be added including Disney's Park Hopper (allows you to visit multiple parks in one day), Disney's Water Park fun and more (includes admission to a water park and DisneyQuest Interactive Theme Park) option and the no expiration option (for a price you can make sure you unused tickets are good forever). There are also a wide range of discounts available for Florida residents, AAA members, and the military. However, they all focus around the same simple idea of decreasing ticket prices per day and the length of your stay increases. This helps entice people to stay at our resort for a longer period of time (thus, causing them to spend more money on hotels, merchandise, and food and beverage).
Disney is a price-setter in the Orlando theme park market, and usually will announce increases in ticket prices in August each year. Typically, Universal Orlando and Sea World Orlando wait for Disney to announce an increase in admission prices before announcing their own. This was evident last summer, when on August 4, Disney announced admission increases only to be followed by similar announcements from Universal Orlando and Sea World Orlando on August 6. This competitive atmosphere allows the three major theme park companies in Orlando to benefit from the success each other is experiencing. Since I have been in the industry (January 2008), none of the major Orlando resorts has decreased ticket prices after seeing the other resorts announce an increase.
Thursday, May 19, 2011
SECA 9: Rivalry
The Walt Disney Company is the number one entertainment company in the world. A subset of that, the Walt Disney World Resort is the top theme park destination in the world as well. The Walt Disney World Resort is able to maintain this title year after year by offering a great product and continually delivering new, unique, and exciting experiences people can't get anywhere else. To say that any company rivals the success of the Walt Disney World Resort would be a farse, but the Walt Disney World resort does have rivals who compete for our business in the Central Florida tourism market.
The biggest rivals the Walt Disney World Resort faces off against are the Universal Orlando Resort. Universal Orland has not been in the market as long as Walt Disney World, but have both established themselves as worthy destination that offer unique experiences (modeling the same practices utilized by Disney).
In order to be successful in any industry, you have to offer a product that is unique to your company and is not easily found somewhere else. In looking at Walt Disney World, we do this very well, feeding off of our Guests' bond to movies, television shows, and brand recognition to help ignite the success of our resort. We refer to this practice as "synergy". For example, last year, Disney's Wide World of Sports underwent a massive rehabilitation and re-branding. Every year thousands of amateur and professional athletes compete in various athletic events at the complex, allowing Disney to gain great exposure in the athletic market. However, as Disney owns and operates ESPN, a name that is synonymous and recognized in the world of sports, so it made sense to incorporate the ESPN name/logo into our on-site sports complex. After it's rehab, Disney's Wide World of Sports emerged as the new, ESPN Wide World of Sports Complex.
This idea of "synergy" is viewable in our theme parks as well, as we often utilize various attractions and characters to promote different parts of our business. Classic attractions such as The Haunted Mansion and Pirates of the Caribbean were turned into film franchises, while successful movies such as Cars, Finding Nemo, Beauty and the Beast, and the Lion King, have been the inspiration for various attractions, shows, restaurants, and character meet and greet areas. Practicing synergy has helped grow our business and left our competitors struggling to imitate our success.
This imitation was best attempted by the Universal Orlando resort in 1999. After undergoing a massive expansion, Universal Orlando was debuting three new hotels operated by the Loews Hotel group, a massive retail and dining area dubbed "Universal's Citywalk," and a new theme park called Islands of Adventure. They were attempting to transform themselves into a vacation destination like Walt Disney World as opposed to a place people could visit in one or two days. Unfortunately for them, they failed miserably.
Islands of Adventure was supposed to transform the theme park world. Universal promoted it as "The most technologically advanced theme park in the world," but it lacked in emotion. They attempted to establish a bond with their guests like Disney does by creating attractions based on comics , superheros, and a successful movie franchise, but guests did not and have not responded like they imagined they would. Universal's major expansion failed miserably and the Company has been sold twice since it's debut.
**Side note. In June 2010 Islands of Adventure underwent a major rehabilitation to incorporate the 'Wizarding World of Harry Potter' into their theme park. It has been a great success thus far, boosting Universal's attendance and profit margins. The affect on Walt Disney World? Our attendance increased as well!**
The biggest rivals the Walt Disney World Resort faces off against are the Universal Orlando Resort. Universal Orland has not been in the market as long as Walt Disney World, but have both established themselves as worthy destination that offer unique experiences (modeling the same practices utilized by Disney).
In order to be successful in any industry, you have to offer a product that is unique to your company and is not easily found somewhere else. In looking at Walt Disney World, we do this very well, feeding off of our Guests' bond to movies, television shows, and brand recognition to help ignite the success of our resort. We refer to this practice as "synergy". For example, last year, Disney's Wide World of Sports underwent a massive rehabilitation and re-branding. Every year thousands of amateur and professional athletes compete in various athletic events at the complex, allowing Disney to gain great exposure in the athletic market. However, as Disney owns and operates ESPN, a name that is synonymous and recognized in the world of sports, so it made sense to incorporate the ESPN name/logo into our on-site sports complex. After it's rehab, Disney's Wide World of Sports emerged as the new, ESPN Wide World of Sports Complex.
This idea of "synergy" is viewable in our theme parks as well, as we often utilize various attractions and characters to promote different parts of our business. Classic attractions such as The Haunted Mansion and Pirates of the Caribbean were turned into film franchises, while successful movies such as Cars, Finding Nemo, Beauty and the Beast, and the Lion King, have been the inspiration for various attractions, shows, restaurants, and character meet and greet areas. Practicing synergy has helped grow our business and left our competitors struggling to imitate our success.
This imitation was best attempted by the Universal Orlando resort in 1999. After undergoing a massive expansion, Universal Orlando was debuting three new hotels operated by the Loews Hotel group, a massive retail and dining area dubbed "Universal's Citywalk," and a new theme park called Islands of Adventure. They were attempting to transform themselves into a vacation destination like Walt Disney World as opposed to a place people could visit in one or two days. Unfortunately for them, they failed miserably.
Islands of Adventure was supposed to transform the theme park world. Universal promoted it as "The most technologically advanced theme park in the world," but it lacked in emotion. They attempted to establish a bond with their guests like Disney does by creating attractions based on comics , superheros, and a successful movie franchise, but guests did not and have not responded like they imagined they would. Universal's major expansion failed miserably and the Company has been sold twice since it's debut.
**Side note. In June 2010 Islands of Adventure underwent a major rehabilitation to incorporate the 'Wizarding World of Harry Potter' into their theme park. It has been a great success thus far, boosting Universal's attendance and profit margins. The affect on Walt Disney World? Our attendance increased as well!**
Monday, May 9, 2011
SECA 8: Product Differentiation/Quality
A long time ago, Walt Disney was at a small, local amusement park with his daughters. As he sat on a park bench watching them enjoy themselves on the merry-go-round, he came up with an idea, to build a theme park where kids and adults could enjoy experiences together.
"We believed in our idea - a family park where parents and children could have fun - together." - Walt Disney
With that thought, the idea of Disneyland was born! Or at least, that's how the story goes. But the idea behind the story, that Disney Parks and Resorts are a family destination remains the same. As a brand we focus on family entertainment over everything else and that focus has resulted in five (soon to be six) theme park/resorts all over the world, with Walt Disney World in Orlando, FL holding the crown as the number one theme park destination in the world.
Over fifty years later, the idea of appealing to families remains the focal point of the success at Disney.While other theme parks owned by Six Flags, Cedar Fair, and Universal offer great experiences, none of them have been able come close to the success experienced at Walt Disney World, as it remains the top theme park destination in the world. These other companies tend to develop attractions that will offer guests thrills and chills, building roller coasters and drop towers that go to insane heights! Disney however, spends eons of time developing a story behind its attractions, creating a world of fantasy and imagination that immerse our Guests into an incredible experience. This attention to detail and focus on providing entertainment every family member can enjoy together has been a consistent recipe for success at Disney, and is one we will not stray from.
"Your dead if you aim only for kids. Adults are only kids grown up, anyway." - Walt Disney
The strategy of focusing on family entertainment has also helped drive the success of other Disney business ventures, including our movie studios and entertainment media (ABC, ESPN, etc.), only strengthening the belief held by Walt Disney all those years ago.
"We believed in our idea - a family park where parents and children could have fun - together." - Walt Disney
With that thought, the idea of Disneyland was born! Or at least, that's how the story goes. But the idea behind the story, that Disney Parks and Resorts are a family destination remains the same. As a brand we focus on family entertainment over everything else and that focus has resulted in five (soon to be six) theme park/resorts all over the world, with Walt Disney World in Orlando, FL holding the crown as the number one theme park destination in the world.
Over fifty years later, the idea of appealing to families remains the focal point of the success at Disney.While other theme parks owned by Six Flags, Cedar Fair, and Universal offer great experiences, none of them have been able come close to the success experienced at Walt Disney World, as it remains the top theme park destination in the world. These other companies tend to develop attractions that will offer guests thrills and chills, building roller coasters and drop towers that go to insane heights! Disney however, spends eons of time developing a story behind its attractions, creating a world of fantasy and imagination that immerse our Guests into an incredible experience. This attention to detail and focus on providing entertainment every family member can enjoy together has been a consistent recipe for success at Disney, and is one we will not stray from.
"Your dead if you aim only for kids. Adults are only kids grown up, anyway." - Walt Disney
The strategy of focusing on family entertainment has also helped drive the success of other Disney business ventures, including our movie studios and entertainment media (ABC, ESPN, etc.), only strengthening the belief held by Walt Disney all those years ago.
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