Megan Carolin Chris Ramento



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Pricing Strategy

A ticket to a Disney theme park is a ticket to a premium, one-of-a-kind experience, and so that comes with a premium ticket price. To determine what to charge for admission to Disneyland India, we first looked at the ticket prices in all the other Disney parks around the world. The following table shows the one day, one park ticket prices and their US Dollar equivalent (Source: Disney.com):







CHILDREN

JUNIORS

ADULTS

SENIORS

Disneyland

$56 (age 3-9)




$66 (age 10+)




Disneyworld

$60 (age 3-9)




$71 (age 10+)




Disneyland Tokyo

¥3900 (age 4-11)

¥5000 (12-17)


¥5800 (age 12+)

¥5100 (65+)

USD

$38

$49

$57

$50

Disneyland Paris

€41 (age 3-11)




€49 (age 12+)




USD

$65




$77.50




Disneyland HK

HK$210 (age 3-11)




HK$295 (age 12+)

HK$170 (65+)

USD

$27


$38


$22

All of the Disney Resorts but Hong Kong consist of two or more parks – Disneyland and California Adventure in Anaheim; the Magic Kingdom, Epcot, Disney’s Hollywood Studios, the Animal Kingdom, and two water parks in Disneyworld Florida; Disneyland and DisneySea in Tokyo; and Disneyland and Walt Disney Studios Park in Paris. All of these resorts offer numerous special packages and prices for “Park Hopper” passes (not shown in the table), which allow guests to visit more than one park throughout the day. This is not something to consider in the short term for Disneyland India, but something to think about in the future as we decide to expand and open more parks. All of the parks also offer Annual Passes, which we will offer at Disneyland India as well.


Disneyland Hong Kong has the lowest prices in the table, and the reason for this is these are the off-peak prices – prices are higher on weekends and holidays. This is an attempt at crowd control since this is the smallest Disney park. Hong Kong and Tokyo also offer lower prices for Seniors. This is most likely a result of the family oriented culture in Asia with respect for elders. This cultural value is also found in India, so we will offer a Senior priced ticket as well.
Ticket prices convey the value of the Disneyland experience, so we want to aim for similar prices at Disneyland India to those in the other Disney parks. As a result, here are the pricing goals for admission tickets on opening day, good for one day in the park, both in Indian Rupees and US Dollars47:
Children (age 3-11) = 2000INR (about $50)

Adults (age 12+) = 2400INR (about $60)


Seniors (age 65+) = 2200INR (about $55)

Our pricing action steps are to maintain these ticket prices but adjust them based on financial reports and park attendance. For example, if we find that attendance is lower during the week, we will offer special ticket prices such as 2-for-1 tickets that allow guests to pay for one day and come back another for free. Or if many guests leave the park early in the afternoon, we will offer lower ticket prices for an evening special ticket for entry to the park after 4pm, which is offered at Tokyo Disneyland. Our main goal is to maintain these ticket prices throughout the first year and offer specials as necessary but keep the price consistent and reevaluate at the end of the first year. We can also adjust prices on merchandise and food in the park to make up for any financial losses without having to change ticket prices. Similar to ticket prices, we will evaluate the sales numbers and financial reports of food and merchandise and adjust prices as needed. The keys to this pricing strategy are the monthly and annual reports which will be evaluated in order to determine where prices need to be changed.


Pricing Action Steps:

When

By Who

KPI’s

  • Financial reports based on park attendance

Monthly

Finance/Attendance Department

Park attendance numbers, financial projections
  • Merchandise and food sale reports


Monthly

Finance Department

Identify most popular products, areas to best increase profit

  • Annual Park Attendance and Financial Report

End of Each Year

Finance/Attendance Department

How can we maximize attendance – raise/lower ticket prices?


Promotion Strategy
Our goal is to raise awareness in every part of India concerning the new park in Trombay. Disney is already known through mobile phone advertisements and films. We want Disney to be in most houses throughout the next few years. We don’t want, however, to be viewed as a westernized brand, but a brand that is for the Indian family. It is our goal to present Disney as a family oriented company that wants to serve families and bring them together. Just as Walt Disney wanted a park for his family to go to and enjoy the experience, we desire the same for Indian families.
We are approaching our brand presentation very slowly. Our strategy to raise understanding of our brand is to place our advertisements in all areas that families often visit together. Many Indian families do events together and children are raised within the involvement of their family members. We will place ourselves in all areas of family development in the Indian household. We want to join with families to support growth and development of their children. We are not looking to advertise to raise their children, but more a support network to help the families.

Our promotional goals include: we will have more mobile and television advertisements. We will be advertising in the language of the areas. Through advertisements, the mention of events that foster to the Indian family will be presented because the Disney Park is an experience. The only way to present some of that experience to families would be to provide experiences in stores and supermarkets and family gatherings. Every year, we will have large festivals specifically to Indian families in parks and large community buildings. Through these events, families will be able to experience a part of what will be in Mumbai. A focus on Disney serving and providing an experience for the Indian family is the most important promotional goal for us. Because we are targeting the Indian Middle Class consumer, it would be relatively affordable for more families to attend.



Action Steps:

When

By Who

Budget

KPI’s

  • Advertisements through phones and visuals

Pre-Opening

Marketing Dept.

$15 Million

Interests in festivals increasing

  • Advertisements specifically for festivals

Pre-Opening

Marketing and Special Events

$10 Million

Reservations for admission to festivals

  • Festivals take place

Pre-Opening

Special Events

$20 Million

High Attendance for festivals/popularity

  • Advertisements for Park

Pre-Opening

Marketing Department/Park Management

$15 Million

Indians inquire more interests in park

  • Promotions to Park

Opening


Disney Mumbai Customer Service and Park Growth

$10 Million

Discounts given and received through attendance.


Supply Chain Issues
For Disneyland India, issues arise concerning the ability of Disney to acquire its merchandise, food, and materials. The closest Disney park would be Hong Kong, which seems as the most efficient place to get product, food and materials. However, we plan to produce the merchandise and raw materials in India. The only difference is in our food supply. In these situations, we plan to have the same restaurant’s that are in other Disney Parks, but hire outside and local producers to prepare the food. Overall our goals include reducing inventory holding costs, increasing inventory turnover cycles, decreasing costs associated with operations, reducing handling costs, and make Disney a more price competitive company.
The strategy for Disneyland India is that of a more in-sourcing system instead of outsourcing for obtaining merchandise and materials. We approach the products and services differently compared to that of our other parks. Instead of receiving product from other facilities that serve the parks to place merchandise, we are going to have facilities specifically for Disneyland India. Instead of looking to Hong Kong to receive product, we are going to be producing the product through our own facilities. Disneyland India will continue to follow the already system designed by corporate called, “the Strategic Sourcing and Procurement Organization”48. This system will be in place in who’s which objective will continue to operate and keep the supply chain efficient and cost declining.

Issues would arise considering outsourcing; but we will not deal with those problems because we are doing the manufacturing and the distributing. Many of American products are already produced in India so the cost is cheaper compared to that of product purchased in the United States or other international locations. We plan for the next five years, to open a facility specifically for the manufacturing of our merchandise and also materials. Work would be cheaper compared to that of other countries. A problem however with having a manufacturing facility serving the park would be restrictions from the government concerning the park owning and operating another facility off campus from the park itself.

Another issue concerns the management of the Disneyland India supply chain team. These leaders need to be people who can plan, implement, and control the materials coming in and going out of the facilities and the efficiency or the workers. There will be a high level of inventory produced so a system similar to that of the JIT systems may not be efficient for our facilities. The leaders will have to face these issues day to day because manufacturing and shipping in and out will consist throughout an entire day.
Although we are able to have the products in close proximity to the park, with the influx of people visiting the park, it is important to keep a solid amount of inventory to eliminate stockouts or even holding costs. The biggest issue would be the overproduction of the product in which there would definitely be stockouts during seasons where park attendance is not as high as normal.

Another issue deals directly with the customer. Similar to the inventory issue, many customers may want to purchase a lot of merchandise because the entire family prefers different items. The demand would be high for certain families, but may very well be less for most. Knowing the balance on how much to produce or hold is a major difficulty that we plan to fix. The quality of product is an issue dealing mainly with manufacturing. However, because the products and materials will be manufactured in a facility, there will be testing machines and checks to make sure the product are the same standards of products sold in other parks. Also, a customer service office would also be located in the facility to help park attendees who need help or more information on a product or service provided by the park itself.

Concerning food for the park, we plan to have similar restaurants compared to those of other parks such as the Enchanted Cottage at Disneyland, Minnie and Friends Breakfast, and the Tomorrowland Terrace, all of which are also at Disneyland California. We would use and integrate Indian food into the restaurants to adapt to the culture and food likings. We also would have foods that are unique to the Disney Parks so if a family goes to one park in one country, they could eat a similar snack in a different park. This may be a cheaper way to supply food because markets and distributors may charge less. However, if the company is not from India, they may require a higher price, comparable to American or European prices.

Overall, the supply chain management would be in charge of direct implementation of the product from the facility to the park. There will be no other middle levels such as storing facilities or defective warehouses because the facility will handle all of those issues. It would be simple Facility to Park system to avoid extra costs.


Supply Chain Action Steps:

When

By Who

Budget

KPI’s

  • Insourcing- Merchandise and Raw Materials

Pre-Opening

Strategic Sourcing and Procurement Organization

$50 Million

Decrease in logistical costs

  • Outsourcing-Food

Ongoing

Department of Food and Drink

$10 million

Increase in sales for restaurants in park




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