WALT DISNEYAS A FOREIGN MARKET ENTRANT

WHAT IS DISNEY?

• International family entertainment & media enterprise• 5 business segments: Media networks Parks & resorts Disney studios Consumer products Interactive

SCOPE & GOALS OF INTERNATIONAL OPERATIONS• Operations in more than 40 countries across different

continents• Goal of establishment in Latin America, Russia, India, China• Renewed focus in Japan, EMEA• Approach to objectives- Consumer preference• Entering Shanghai

MARKET ENTRY MODES

JAPAN(TOKYO)Licensing

agreementOwned &

operated by OCLC.

Licensed to use IP,

trademarks,Disney gets

royalties.

FRANCE(PARIS)

Wholly-owned subsidiary-

Euro Disneyland

Total control of operations as

a majority.

CHINA(HONG KONG)

Joint venture between HK Government

& Disney-HK

International Theme ParksHK Govt-57%

CHINA(SHANGHAI)Joint Venture

between Shanghai Shendi

Group & Disney

SSG-57%Disney-43%

WERE THE MODES USED SUCCESSFUL?

TOKYOADV- Adapted to local tastes and culture; Liability of Foreignness

reduced.DISADV- Lost international exposure & control over operations & marketing.

PARISADV- Supported by French govt due to simple

FDI regulations. Full control & localisation.

DISADV-Inability to adapt with large cultural differences.

HONG KONGADV-Govt as a

contractual advisor & investor

as Asia is a complicated market. Best

mode of entry chosen by Disney.DISADV- Risk of partner stealing

technology/ideas.

SHANGHAIADV-Disney

should’ve been able to run on its own, but

Chinese govt power is more. So JV is better

OTHER MODES OF ENTRY?

• PARIS: A joint venture could’ve avoided the Liability of Foreignness, mitigating risks.• SHANGHAI- Through its previous experience with JV, it

could’ve taken on a WOS. Although the difference in government influence means a JV is better suited.

CHALLENGES FACED

• Changes in the US global/economic conditions- leading to reduced economic activity and declined demand• Adapting to consumer tastes outside US• Maintenance of IP- especially in China, where IP laws are

weak• Environmental & political concerns- changes in political,

military & environmental laws

CONCLUSION

• Disney’s tendency of internationalisation- local partner with high absorbent power & an ability to transfer resources without compromising value• Building good international experience with right entry

modes. Doesn’t believe in “eating all the pie” after Paris.

REFERENCES

• Hernandez, C. (2011). International Modes of Entry- The Case of Disney. Norges Handelshoyskole, pp. 10-47. Retrieved from http://brage.bibsys.no/xmlui/bitstream/handle/11250/168935/hernandez%202011.pdf?sequence=1• The Walt Disney Company. (2014). Fiscal year 2014 annual

financial report and shareholder letter. Retrieved from https://cdn.thewaltdisneycompany.com/sites/default/files/reports/10k-wrap-2014_1.pdf

• The Walt Disney Company. (2015). Our Businesses. Retrieved from https://thewaltdisneycompany.com/disney-companies• Peng, M. (2013). Global Business (3rd ed.). South-Western:

Cengage Learning.