Somewhere Over China...

[clsteve]

So, this was in my email from a friend this morning:

http://www.huffingtonpost.com/gary-snyder/disney-ceo-fumbles-entry-to-china_b_6682090.html

It looks like the Huffington Post has decided to be the slave whispering in Caesar's ear during the media Triumphal Iger has been taking lately.

It's an interesting take on Shanghai. Especially in wake of the additional 800 mil in funding and the construction schedule.

 

[lockedoutlogic]

Lol...

Not be negative...

But I reached out with the force and I sense alot of euro in the Chinese parks...
Alot of similarities.

 

[clsteve]

Lol...

Not be negative...

But I reached out with the force and I sense alot of euro in the Chinese parks...
Alot of similarities.

Yep.

I lived in the Far East for 3.5 years back in the late 80's early 90's on business (Japan). The Chinese are so different culturally and Western movies and media have been banned for so long - his take on no emotional investment in Disney culture is spot on.

And, you can't point success in Hong Kong as a reason to not worry. Hong Kong is/was a western influenced Anglo colony. It's a different beast and it's people very different than mainland Chinese in all areas of cultural exposure.

Not being negative, either. just validating some of the observations....

 

[lockedoutlogic]

Not only that...but Hong Kong hasn't blown anybody away...

ALOT of Eurodisney similarities there...

 

[clsteve]

Not only that...but Hong Kong hasn't blown anybody away...

ALOT of Eurodisney similarities there...

What they've got going for them is that 380 million within driving distance. That sets up a great honeymoon first couple of years (like Euro). After that, if the Chinese don't attach emotionally, it will be interesting.

Also, the relationship with that big government holding entity they're dealing with - through the ups and downs will be the most interesting thing to watch in all of this.

 

[rteetz]

Not only that...but Hong Kong hasn't blown anybody away...

ALOT of Eurodisney similarities there...

And Shanghai's resort leader is the former leader of DLP.

Hong Kong is on lace for some rapid expansion soon. New resort currently being built, a new park in the works apparently as well as a "Disney town".

 

[DDLand]

This article is ridiculous.

1) Bring up Euro Disney which ironically was a major success in their park. The problem was hotels, and not selling alcohol. They adjusted and fixed the issues in a couple years turning it into a relative success. The problem of the hotels still existed for years afterwards. It was only after the author's beloved Mr. Eisner was an idiot and built Walt Disney Studios that things turned critical over the last decade.

2) McMagic Kingdom. Really? I don't suppose the author realized that since 2009 Hong Kong Disneyland has been on a massive expansion run. It was only thanks to Mr. Iger that started the several hundred million dollar expansion. Attendance is now up, and it's making a profit. Most of the problems were related Mr. Eisner being an idiot and making a budget park.

3) I don't think Iger has ever said that Disney is the best recognized brand in China. Never. What this park is going to do is introduce 100s of millions to Disney. The author doesn't think that the Disney brand will speak for itself and amaze. The beautfilly designed rides, excellent themeing, and well trained cast will be what builds brand loyalty. I don't think I go to Disney Parks just because of movies, I go because it's the best theme park operator in the space. That does build loyalty to Disney though. Sure there could be road bumps at the beginning, but in time they have an impressive roster rides that will get good word of mouth and bring guests in.

4) On the brand, one question. So under Eisner it was alright to release movies under different brands or banners but not Iger? You're okay with Miramax but not Marvel? Okay...

 

[rteetz]

This article is ridiculous.

1) Bring up Euro Disney which ironically was a major success in their park. The problem was hotels, and not selling alcohol. They adjusted and fixed the issues in a couple years turning it into a relative success. The problem of the hotels still existed for years afterwards. It was only after the author's beloved Mr. Eisner was an idiot and built Walt Disney Studios that things turned critical over the last decade.

2) McMagic Kingdom. Really? I don't suppose the author realized that since 2009 Hong Kong Disneyland has been on a massive expansion run. It was only thanks to Mr. Iger that started the several hundred million dollar expansion. Attendance is now up, and it's making a profit. Most of the problems were related Mr. Eisner being an idiot and making a budget park.

3) I don't think Iger has ever said that Disney is the best recognized brand in China. Never. What this park is going to do is introduce 100s of millions to Disney. The author doesn't think that the Disney brand will speak for itself and amaze. The beautfilly designed rides, excellent themeing, and well trained cast will be what builds brand loyalty. I don't think I go to Disney Parks just because of movies, I go because it's the best theme park operator in the space. That does build loyalty to Disney though. Sure there could be road bumps at the beginning, but in time they have an impressive roster rides that will get good word of mouth and bring guests in.

4) On the brand, one question. So under Eisner it was alright to release movies under different brands or banners but not Iger? You're okay with Miramax but not Marvel? Okay...

Now in Eisner's defense they didn't see a return on DLP yet and the French government wanted a second park in a certain amount of time. So while they could've done better there I can see why it was built bad. Disney didn't really want it built then.

I'll give you number 2 and 3.

4. I think Iger does rely too much on the brand itself and not how to make it better. Eisner didn't have as many brands as Iger does. Eisner also was here much longer than Iger has been, Eisner had many successful movies and some non successful.

 

[DDLand]

Now in Eisner's defense they didn't see a return on DLP yet and the French government wanted a second park in a certain amount of time. So while they could've done better there I can see why it was built bad. Disney didn't really want it built then.

I'll give you number 2 and 3.

4. I think Iger does rely too much on the brand itself and not how to make it better. Eisner didn't have as many brands as Iger does. Eisner also was here much longer than Iger has been, Eisner had many successful movies and some non successful.

Good points.

1. I would say on one that Walt Disney Studios was Eisner's MO at the time. It's true he was dragged into it, but he wasn't dragged into budget constrained DCA, DAK, and HKD. Each of these parks was built with similar results. I feel like he took away the worst lessons from Euro Disney. Instead of looking at the #1 tourist attraction in Europe as a result of building a good theme park, he just thought it was all too risky. He applied that skewed thinking globally.

4) I can see where people could think that. Though we've been getting good movies like Malficent as of late.

 

[clsteve]

This article is ridiculous.

1) Bring up Euro Disney which ironically was a major success in their park. The problem was hotels, and not selling alcohol. They adjusted and fixed the issues in a couple years turning it into a relative success. The problem of the hotels still existed for years afterwards. It was only after the author's beloved Mr. Eisner was an idiot and built Walt Disney Studios that things turned critical over the last decade.

2) McMagic Kingdom. Really? I don't suppose the author realized that since 2009 Hong Kong Disneyland has been on a massive expansion run. It was only thanks to Mr. Iger that started the several hundred million dollar expansion. Attendance is now up, and it's making a profit. Most of the problems were related Mr. Eisner being an idiot and making a budget park.

3) I don't think Iger has ever said that Disney is the best recognized brand in China. Never. What this park is going to do is introduce 100s of millions to Disney. The author doesn't think that the Disney brand will speak for itself and amaze. The beautfilly designed rides, excellent themeing, and well trained cast will be what builds brand loyalty. I don't think I go to Disney Parks just because of movies, I go because it's the best theme park operator in the space. That does build loyalty to Disney though. Sure there could be road bumps at the beginning, but in time they have an impressive roster rides that will get good word of mouth and bring guests in.

4) On the brand, one question. So under Eisner it was alright to release movies under different brands or banners but not Iger? You're okay with Miramax but not Marvel? Okay...

Hardly ridiculous. His points on the culture are spot on. And the premise of the article is raising the risk that it won't resonate with the culture. Valid point.

A huge part of of a theme park's success monetarily is it's merchandising. There's a reason that the princesses are everywhere to the detriment of boys' themes. They sell stuff. If the Chinese just come and enjoy the great rides without leaving with bags of stuff - it's an issue.

If the little Chinese girls don't identify with Ana and Elsa and beg mommy and daddy for that princess lunch box and backpack, or tiarra, it's an issue.

If they just drive over for the day and don't stay in the hotels, it's an issue.

All valid points that none of us know until it opens. Hence the validity of the issue.

Europeans have a strong identifcation with Disney. Many of Disney's main themes are rooted in fairy tales strongly imbedded in Euro culture. The Japanese have a strong emotional and fiscal attachment to all things of American culture. Hong Kong was a British colony/protectorate since the 1840's.

None of this with mainland Chinese. in fact, the exact opposite - hundreds of years of anti-western cultural viewpoints aggressively enforced by the government.

I don't think the article is ridiculous pointing out the risk.....

 

[rteetz]

Good points.

1. I would say on one that Walt Disney Studios was Eisner's MO at the time. It's true he was dragged into it, but he wasn't dragged into budget constrained DCA, DAK, and HKD. Each of these parks was built with similar results. I feel like he took away the worst lessons from Euro Disney. Instead of looking at the #1 tourist attraction in Europe as a result of building a good theme park, he just thought it was all too risky. He applied that skewed thinking globally.

4) I can see where people could think that. Though we've been getting good movies like Malficent as of late.

Now I'll agree for the most part. AK in my opinion even tho it was underdone in my opinion is still a fascinating park. I don't necessarily think avatar is the best answer but I'm not opposed to it either. It's very promising and uses the space better than meet and greets.

 

[nkosiek]

in fact, the exact opposite - THOUSANDS of years of anti-western cultural viewpoints aggressively enforced by the government.

FYP

 

[Bay]

Seems to me people might be overlooking Shanghai's background. Shanghai became what it is today because of massive European interference, and is an extremely Westernized city. When I studied in China, if a foreign student went to Shanghai it was considered a cop-out because you didn't need to speak a lick of Chinese to live there. The city is extremely international and I think the point of Disney targeting the area in the first place is because it hosts a ton of expats, locking in a portion of the market already. I don't think Taiwanese or South Korean tourism is out of the picture either, which because of their history might be more willing to buy into American symbols.

The real struggle of course will be the larger market of mainland China, which I agree will be a struggle for Disney to connect. Mickey and Stitch are decently popular in large metropolitan areas, and a direction that focuses on those types of characters that have (albeit small) followings might work best.

 

[DDLand]

Hardly ridiculous. His points on the culture are spot on. And the premise of the article is raising the risk that it won't resonate with the culture. Valid point.

A huge part of of a theme park's success monetarily is it's merchandising. There's a reason that the princesses are everywhere to the detriment of boys' themes. They sell stuff. If the Chinese just come and enjoy the great rides without leaving with bags of stuff - it's an issue.

If the little Chinese girls don't identify with Ana and Elsa and beg mommy and daddy for that princess lunch box and backpack, or tiarra, it's an issue.

If they just drive over for the day and don't stay in the hotels, it's an issue.

All valid points that none of us know until it opens. Hence the validity of the issue.

Europeans have a strong identifcation with Disney. Many of Disney's main themes are rooted in fairy tales strongly imbedded in Euro culture. The Japanese have a strong emotional and fiscal attachment to all things of American culture. Hong Kong was a British colony/protectorate since the 1840's.

None of this with mainland Chinese. in fact, the exact opposite - hundreds of years of anti-western cultural viewpoints aggressively enforced by the government.

I don't think the article is ridiculous pointing out the risk.....

That's why a series of fake Disney theme parks are already in operation on the Chinese Mainland. The Chinese are starving for a great theme park experience that is safe, high quality, and is a fun place for families. Up until this point none really exist. Disney is going in and are on track to set the bar of what a theme park has to be in the market.

Hong Kong Disneyland is known to drive lower merchandise sales, and it still manages to make money.

Give it time, this theme park is another gateway into the Disney brand.

There aren't very many hotel rooms, but keep in mind Hong Kong Disneyland has something like 93% occupancy at their hotels. If that's any basis, Shanghai should do fine.

Remember, the market is just looking for a quality player. China is a wide open field more like America in the 1950's then anything else. The crappy local carnival parks are going to the wayside in a massive sweep towards larger premium players.

I'd say the article is ridiculous for all the reasons I mentioned in the other post plus this one, people only go to Disney because of the mouse. That's silly. People go to Disney because it's the best product in the category. Period. I think the Chinese will step into Shanghai Disneyland and feel the difference. They're going to realize that this is nothing like anywhere else they've been before. Just like millions of Americans do each time someone steps into a Disney park for the first time, they're going to be immersed and amazed.

It should also help that it's local government sponsored...

Also Iger has never come out and said from day one it'll be a major success. He has pointed out just how important getting their foot in the door is longterm. It could be a decade before it starts making money, but Disney parks almost always gain loyalty. As more and more people enter the middle class, Disney will already have a dedicated customer base.

Disney, Dreamworks, and Universal see how important this is. Disney is just outspending and out building them. This is going to be good...

 

[DDLand]

Seems to me people might be overlooking Shanghai's background. Shanghai became what it is today because of massive European interference, and is an extremely Westernized city. When I studied in China, if a foreign student went to Shanghai it was considered a cop-out because you didn't need to speak a lick of Chinese to live there. The city is extremely international and I think the point of Disney targeting the area in the first place is because it hosts a ton of expats, locking in a portion of the market already. I don't think Taiwanese or South Korean tourism is out of the picture either, which because of their history might be more willing to buy into American symbols.

The real struggle of course will be the larger market of mainland China, which I agree will be a struggle for Disney to connect. Mickey and Stitch are decently popular in large metropolitan areas, and a direction that focuses on those types of characters that have (albeit small) followings might work best.

Interesting, thanks for the insight.

 

[Andrew015]

Shanghai Disneyland is being built in the Pudong district of Shanghai, a city with more than 25M people living within its limits. For anyone who has ever traveled to Shanghai, you know that Pudong is the epicenter of the city. They would also know that the city is littered with literally thousands upon thousands of hotels. I really find the decision to plunk SDL right in the heart of Pudong interesting for a couple of reasons. First off, Shanghai is where the "wealthy" live. You've just given 25M "wealthy" Chinese people the opportunity to be "day guests" and return home after a day of exploring. Wouldn't it have been more prudent to locate the park "further out" in a less-developed area where now folks are "locked in" to Disney accommodations? I really don't think attendance will be an issue, but I do think a huge opportunity was missed to capitalize on significantly greater hotel revenues by placing the park right smack-dab in the middle of the "hotel capital" of Asia (Pudong).

The other thing that anyone who has visited Shanghai (in recent years at least) would understand is that the pollution levels are incredible. I fully suspect that there will be days that the Castle won't be visible from the front gates due to the smog levels. It's simply a part of daily life for the residents of Shanghai, but for outsiders, it is quite alarming. It's completely evident, to me at least, that this park is geared solely towards the local population. Sure, it will be a novelty for Westerners who are traveling on business, but I don't think very many folks from continents other than Asia will be packing their bags for a week's stay at DLS.

 

[Yellowstonetim]

Disney doesn't do bad in China, just not as good as Korea and Japan. But it's about the future, not the past. Disney knows it needs to appeal to Chinese culture. Therefore they are partnering to develop movies that will be called Disney but will have Chinese elements and will be aimed directly at China, not the US or Europe.

http://www.hollywoodreporter.com/news/disney-develop-chinese-productions-shanghai-686725
"Under the deal, Burbank-based Disney Studios will partner U.S. screenwriters with writers and directors in China to co-develop film projects that are essentially Disney, yet contain "Chinese elements.""

I wouldn't be surprised if a few characters we wouldn't recognize pop up at Disney Shanghi from these movies.

It is also of note that an additional $800 million was added to the Shanghi project. Maybe they learned that you need to spend a little more BEFORE you open the park!

While it is possible that things don't go as planned, the market is so humongous and untapped that Disney will do fine in the long run.

 

[Bay]

I fully suspect that there will be days that the Castle won't be visible from the front gates due to the smog levels.

Maybe it'll be more dramatic if it pops out of nowhere when you walk up to it

Great point about the hotels though. I wonder if this means they really don't think the hotels are worth the cost/effort in the Asian market.

 

[ccudmore]

Whatever the Blog post said, it appears that it should be taken with a grain of salt. It's been removed and replaced with the message "This blogger's posts are no longer available on The Huffington Post due to inaccuracies in representations he made regarding his professional affiliations."

 

[clsteve]

Whatever the Blog post said, it appears that it should be taken with a grain of salt. It's been removed and replaced with the message "This blogger's posts are no longer available on The Huffington Post due to inaccuracies in representations he made regarding his professional affiliations."

"Willow...?!?!"

"Yes, Bob?"

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"No, Bob"

"Read it"

"Wow, Bob. That's not good..."

"Fire the guy...!!"

"I'm at USC, now. I'm not running the show at HuffPo anymore..."

"Make a call..."

"Yes, Bob..."