Research Paper: Marketing Strategies of the Shanghai

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[. . .] ii. Pricing Strategies

a. The Most Potential Customer Segment:

The Shanghai Disney Resort will offer a number of recreational and entertainment facilities -- most of which are expensive enough to be affordable by the upper middle and higher income group only. Therefore, the most potential target market for the Shanghai Disney Resort will only consist of well-off families from the local and international markets. The preliminary facilities which the Shanghai Disney Resort has planned cannot be offered at low prices. Reason being, the Walt Disney Company and the Shanghai Shendi Group have invested a huge amount on this project. In order to get attractive returns on their investment and make the payback period short, they will have to charge high prices for all types of facilities and offerings -- ranging from theme park entrance to the dining at the deluxe and value hotels.

b. Why Chinese Market?

The Walt Disney Company has chosen Chinese market for its international expansion project in the form of Shanghai Disney Resort. This strategic decision was made in the light of numerous positive analyses and predications about the Chinese economy. The first positive reason was the population of this country which will give Shanghai Disney Resort the biggest customer base for its product offerings. Secondly, the living standards of the middle and upper middle income groups in China have been rising due to the improvements in the economic conditions of the country as well as rapid developments in its industrial and services sector. Therefore, the Walt Disney Company has chosen this market after anticipating its middle and upper middle income groups to be transformed into more well-off and contented groups in the near future.

iii. Promotional Strategies

a. Segmentation for Promotional Campaigns:

The Walt Disney Company is using various marketing and promotional mediums for its mega project, the Shanghai Disney Resort. The promotional campaigns have been designed on the basis of benefit sought segmentation and product usage segmentation. The Walt Disney Company promises that its Shanghai Disney Resort would be the happiest place on the planet which will offer a lot of facilities to all age groups. The amusement parks, live cartoon characters, seasonal flowers, lack, imaginative castle, and refreshing dining experience will give them entertainment, leisure, happiness, thrill, and memorable moments of life.

b. Selection of Promotional Mediums:

At present, the Shanghai Disney Resort is under construction and reaching its completion in 12-15 months period. The Walt Disney Company will launch its major campaigns at the end of 2015 when it will have to inaugurate the resort. The major promotional mediums which the company will use for its Shanghai Disney Resort include electronic media, print media, social media networking sites, outdoor advertising mediums, and its official and project-based websites; like the Shanghai Disney Resort, the Walt Disney Company, Walt Disney Parks and Resorts, etc.

The electronic media includes television and radio which can promote the company's products at the massive level throughout the country. This promotional media will also take the biggest portion from the company's marketing budget (Paley, 2006) [footnoteRef:10]. The second major promotional media is the daily newspapers and magazines which are published and distributed in all the big and small cities and towns of the country. The emerging promotional mediums like interactive websites, social media networking sites, and digital billboards will also contribute in creating brand awareness and attracting potential customers from the local and international markets (Clow & Baack, 2009)[footnoteRef:11]. Finally, the billboards, transit advertising, and posters will be used to promote the Shanghai Disney Resort in the local areas like the Pudong International Airport, super markets, and populated towns. [10: Paley, N. (2006). The Manager's Guide to Competitive Marketing Strategies] [11: Clow, K.E. & Baack, D. (2009). Integrated Advertising, Promotion, and Marketing Communicaitons.]

iv. Place Strategies

The Walt Disney Company has planned to target customers from all the cities and towns of China. The Shanghai Disney Resort is being built in a populous, well-developed, and economically strong city. In the initial phase, the company has set a goal to target each and every customer that comes within an area reachable in 3-hour drive or railway journey. That is, the Shanghai Disney Resort will not only target local people from Shanghai, but also from other developed and high-economy cities.

The supply chain and distribution partners of the company will also play a vital role in making this project a success in a very short period of time. The distributors will not only promote its business in the potential markets from the local and international locations, but will also help it in ensuring quality and innovation in every aspect of its business operations.

4. Overall Plan of Shanghai Disney Resort

i. SWOT Analysis

a. Internal Environment

(i). Strengths

(ii). Weaknesses

The biggest strength of Shanghai Disney Resort is the financial position of its owner companies. The Walt Disney Company and the Shanghai Shendi Group are financially stable and large scale corporations that have always invested in huge business projects at the local and international levels. Therefore, the Shanghai Disney Resort will not face any difficulty during the normal course of its business or while expanding its operations in the future.

The product offerings by the Shanghai Disney Resort are quite unique which will give it a new position in the Chinese market. The amusement parks, hotels, lake, Disney characters, and various other entertainment facilities are specifically designed for all age groups and social classes. Therefore, the Shanghai Disney Resort will be able to target a large customer base (The Shanghai Disney Resort, 2013)[footnoteRef:12]. [12: The Shanghai Disney Resort, (2013). Fact Sheet.]

The Shanghai Disney Resort will also enjoy full support from the Chinese Government and the large scale enterprises from the local and international markets.

Moreover, a high level of brand awareness, popularity of the Disney characters, and innovative facilities are the core strengths of the Shanghai Disney Resort.

Due to the huge investment, the Shanghai Disney Resort can be considered as the riskiest investment of the decade by the Walt Disney Company. This huge investment has some drawbacks like high operational costs, pricing policies, labor costs, and sunk costs.

The theme parks, hotels, and other entertainment and recreational facilities offered by the Shanghai Disney Resort are quite expensive as compared to its competitors' offerings. This weakness will make it highly difficult for the company in targeting the lower and middle income groups of the society.

The Shanghai Disney Resort is being opened in the Chinese market which has a totally different culture than Europe, America, and Australia. Therefore, the company will face difficulties in adjusting its operations, policies, and practices according to the new culture.

Being an extremely large scale project, the Shanghai Disney Resort will have to expend a huge amount on each and every aspect of its business operations; like marketing campaigns, Research and Development, Quality Control, supply chain, employee training and skills development, etc. (Mullins, Walker, & Boyd, 2008)[footnoteRef:13]. [13: Mullins, J.W., Walker, O.C. & Boyd, H.W. (2008). Marketing Management: A Strategic Decision Making Approach.]

b. External Environment

(i). Opportunities

(ii). Threats

The Shanghai Disney Resort can create thousands of employment opportunities for the local labor force with the passage of time. It will bring a positive impact on the Chinese economy as well as on the sustainability and public image of the Walt Disney Company.

In order to stay competitive, the Shanghai Disney Resort can add new, improved, and innovative facilities in its existing offerings.

It can further widen the scope by making its facilities affordable and accessible to all kinds of social classes and income groups of the society.

In addition to attracting the local population from China, the Shanghai Disney Resort can also promote its services and facilities to the foreign tourists from neighboring and developed countries of the world in order to earn attractive returns on investment.

The biggest threat for the Shanghai Disney Resort is the uncertain economic conditions which can either turn in favor or against its business operations at any point in time. In bad economic conditions, the Shanghai Disney Resort will have to bear low sales and adopt stability strategy for its operations.

The second major threat for the Shanghai Disney Resort is cultural differences which it will face in the Chinese market. However, the threat of cultural imperialism would be little unperturbed due to success of Hong Kong Disneyland. The analysis which the company had done for the Hong Kong market is also applicable for the Chinese market.

Moreover, the Research and Development costs, commodity prices, governmental regulations on environmental protection and ethical business practices will also bring critical challenges for the company.

5. Failed Market Strategy

The Shanghai Disney Resort has planned to target its potential customers with high pricing strategy. Apparently, this strategy may not give the desired results to the company due to the cultural imperialism and economic infrastructure in China. The major population of China belongs to lower and middle income groups. Converse to this demographic… [END OF PREVIEW]

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Marketing Strategies of the Shanghai.  (2013, June 19).  Retrieved July 22, 2019, from https://www.essaytown.com/subjects/paper/marketing-strategies-shanghai/3346522

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"Marketing Strategies of the Shanghai."  19 June 2013.  Web.  22 July 2019. <https://www.essaytown.com/subjects/paper/marketing-strategies-shanghai/3346522>.

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"Marketing Strategies of the Shanghai."  Essaytown.com.  June 19, 2013.  Accessed July 22, 2019.
https://www.essaytown.com/subjects/paper/marketing-strategies-shanghai/3346522.