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Theme Park Concept Shanghai

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Anja Friesenecker

on 29 August 2016

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Transcript of Theme Park Concept Shanghai

Chart TV GRPs
Theme Park Concept Shanghai I Practical New Product Development and Marketing October 4, 2015

Concept
Research Design
Decision to make, prior opening:

Ticket price
1. 350 RMB or 2. 250 RMB

Sample composition:
Who?
1. Residents and 2. Tourists
Sample size?
1. Residents: 900 samples - 809 effective samples
2. Tourists: 650 tourists sampled - 621 effective samples

Data Collection Method:
via Internet & at the Airport

Reliability in Survey Measurement is guaranteed
Objective
Background
Concept Movie
Concept Brochure
Analysis
Promotion budget : 5% of total Shanghai Disney investment RMB ¥24.048 billion
(
RMB ¥1.22 Billion
)
Marketing Spending
Target Market :

Shanghai Local residents
International / Domestic tourists
Target Definition :
Shanghai Locals
Family Household
Single Young Adult (18~35)
International tourists
Domestic tourists
Estimated Target Universe Size :
Domestic tourists (113,690,000 in 2013)
International tourists (7,913,000 in 2014)
Marketing Plan
Local Marketing
Key target groups: Families, Couples, Pals

Low level of (direct) competition

Shanghai is a very well chosen location, thanks to its position as a transport hub and its cosmopolitanism

High intention to visit Disney - Shanghai (residents and tourists)

Local residents are more price sensitive

Price: RMB 250 should be chosen
Executive Summary
Key Takeaways
Largest Chinese city
by population

34,000,000 inhabitants (greater Shanghai - metropolitan area)

Global financial center
(16th in Global Financial Centers (2015))

Cultural and economic center

Transport hub

(2 airports, modern railway system)

Very popular
tourist destination

(2013: Domestic: 114 M/ Foreign: 7.91 M)


Need of a Visa for foreign tourists (Max. 72 hours Visa free)

World´s most visited theme park company

134,000,000 guests (2014)

One of the Walt Disney Company´s four major segments
Revenues (worldwide 2014): $US 15.1 billion
Operating income (worldwide 2014): $US 2.7 billion
6 Disney resorts worldwide (including Shanghai)


Shanghai

Shanghai Disneyland Park:

Central Location
near the City and
the int. Airport

6 Parts: Micky Avenue, Fantasyland, Gardens of Imagination, Tomorrowland, Adventure Isle, Treasure Cove

Expected:
31 attractions
25 Restaurants
16 Souvenir shops
3 Characters meet-and-greet areas

Total budget: $US 5.5 billion (April 28, 2014)
3 times the size of Hong Kong Disneyland
Combines Disney themes with Chinese culture


Consumer
Survey Data
Majority definitely would go - in all 4 categories
Followed by the group "Probably would go"
Outcome of both Residents categories is quite surprising
(as Asians tend to rather give moderate answers)
Competition
Competitor: Disney Hong Kong but more expensive (RMB¥ 410) and smaller

Local competitors in Shanghai (JinJian amusement park, Magic land, Kids Park...), with ticket price (RMB¥ 100 ~ RMB ¥230)

As a result, the competition is indirect for the Disney Shanghai park
Majority will wait until others have visited and given their recommendation
Still relatively high share intends to be one of the first visitors
Most interested groups are
Families, Couples, Pals
Most disinterested groups are
elder people, single visitors
Majority visits in the first 6 month instead of 3
- waiting for recommendation
Majority would recommend
Asians prefer to give moderate answers
Limitations
The Consumer Overstatement Phenomenon
coming with higher prices
cultural factors (Ethnicity, History, Political etc.)
Product category
Demographic factors

In order to accurately estimate the sales potential of new product, that consumer overstatement factor has to be adjusted accounted for.
Evaluate the sales potential of the Disney Park in Shanghai

Based on:
Conducting forecasts
based on the
"Lin Model Framework"

Quantifying consumers' acceptance
of the park
number of visitors
willingness to pay (entrance, food, souvenirs)

Determining the
optimal pricing scheme

Marketing plans
Key drivers of visits
Key target groups

1 year time horizon

Assumed launch date:
April 1st, 2016
Why it will be successful
The concept is appealing

Better quality than competition (larger, more attractions)

Reasonable price in relation to the overall value of the experience

Large exposure thanks to strong marketing efforts

Very high brand awareness

Weak potential competitive reaction


Majority of all 4 categories going to Shanghai by Railway & Subway
PuDong International Airport
HongQiao Domestic Airport / Hub
Subway
Theaters (122)
Theme Parks have three main sources of revenue

Admission Fees
Food and Beverages
Souvenirs
We want to choose the pricing scheme that maximizes the total sales in a 1 year time frame
Questionnaire
Majority of both categories...
..."Residents" going to Disney Park by car followed by Subway
..."Tourists" going to Disney Park by Subway followed by Taxi & Bus
Ticket Promotion
Recommendations
Long range view and focus on quality rather than speed

Emphasis and continuous measure of consumer satisfaction

Constant marketing effort, including after the first years of activity

National TV: 1 GRP= RMB 6000
Local TV: 1GRP= RMB 2500
Hedonic Avg.:
only a slight difference for residents (RMD 250 better than RMB 350)
Avg. Price/Value:
better result for RMB 250 ticket
Avg. Uniqueness:
only slightly better result for Tourists RMB 350
Both Residents and Tourists
plan to visit
Disney between 1.1 and 1.2 times during Year 1 and 1.0 and 1.1 times after Year 1
Residents (avg. 3.4) plan to come in bigger
groups
than tourists (3.1)
Visitors paying a higher price for the ticket plan to spend more
money for food
but not for
merchandise
(tourists plan to spend slightly more)
Avg. Travel Time to the Disney Park
is between 30 and 37 minutes
Tourist have slightly higher
income level
Results do not explain if higher income level individuals are willing to pay a higher price

Estimated visitors
RMB 250
RMB 350
9,8 million
5,92 million
Local residents have a higher price sensitivity.
Geography and average annual income main drivers
RMB 2,452
million
RMB 250
RMB 2,073
million
RMB 350
RMB 1,840
million
RMB 250
RMB 1,295
million
RMB 350
RMB 1,970
million
RMB 250
RMB 1,295
million
RMB 350
Conclusion:

Disney Shanghai will obtain a
28% higher
revenue by choosing an admission fee of
RMB

250
Local residents have a higher price sensitivity.
Geography and average annual income
RMB 2,452
million
RMB 250
RMB 2,073
million
RMB 350
Number of vistitors

Calculation of trial rate

Optimal Pricing Scheme
Revenue calculations
Full transcript