Disneyland in Hong Kong essay

Introduction

Disneyland in Hong Kong seemed a viable business investment, as Hong Kong is the leading destination for tourist arrivals, has highly skilled human resources and good infrastructure. However, Disneyland in Hong Kong does not fulfill guests' expectations and is in the failing position based on the recent business reports. Therefore, the company needs changes in its strategies and business goals. The main strategy of Disneyland in Hong Kong is to provide high quality services that will satisfy customers' needs. The mission of Disneyland is to deliver unique and unusual services and offer an individual approach to every client (Hong Kong Disneyland, 2014).

At the present time, business in Hong Kong is very competitive. It is  the reason that customers have high expectations of Disneyland. Negative feedbacks from customers prove that Disneyland in Hong Kong does not meet their expectations. Thus, Disneyland should take into consideration its weaknesses, change management strategies and make the right decision about development and growth.

 

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Target Market and Services of Disneyland

The target market of Disneyland includes consumers of all ages. However, the largest segments are parents with small children, teenagers and young people, who prefer to buy new products and use different services. Disneyland in Hong Kong offers many services: resting, playing, entertaining, catering and shopping. Disneyland Park consists of dining and shopping places, Adventure Land, Tomorrow Land, Fantasyland and Toy Story Land. Hong Kong Disneyland provides the customers with accommodation, hotel dining, character dining, Disney fairy tale weddings and Disney meetings.

Task Environment

Hong Kong Disneyland has a favorable microenvironment. Its analysis using Porter's five forces model is effective in the decision making regarding the business strategy. According to annual business reviews, Disneyland in Hong Kong is not always profitable; therefore, it is necessary to define the reason of its losses.

Power of Suppliers

It is evident that Hong Kong Disneyland is completely dependent the suppliers. The potential strategy for success may be based on an individual supplier who will be reliable. The company’s suppliers provide food, beverage, office equipment and entertainment devices. Disneyland can replace the current supply chain partners with more reliable once, as they do not influence the competitive advantage of the company.

Power of Customers

Power of customers is the ability of consumers to pressure the margins and volumes. In Hong Kong Disneyland, the customers have low power because the industry is differentiated. Therefore, the threat from customers is low, but Disneyland should develop their service strategy for attracting new customers.

Threat of Potential New Entrants

The main danger for Hong Kong Disneyland comes from potential new entrants. The recent proposition to construct a third Disneyland in Shanghai poses a serious threat to the business. Moreover, the new Disney Park will be eight times larger than the Hong Kong one. Thus, the Chinese citizens will have the option to go where it is more convenient, cheaper or more interesting. New Disneyland in Shanghai is a real threat for Hong Kong Disneyland (Akkaya, 2000).

Competition among Existing Competitors

Hong Kong Disneyland has many competitors that are dangerous for their further success. Ocean Park, the people's amusement park, is a direct competitor of Disneyland. Entree fee in Ocean Park is lower than in Disneyland. Thus, teenagers are likely to choose Ocean Park, as their purchasing power is lower. Ocean Park offers different services such as Whales and Dolphin Funds, and capitalizes on the environment saving strategy. Ocean Park is more attractive for some segments of customers, and poses a serious threat for Disneyland.

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Availability and Comparability of Substitutes

The leisure and retail industries are the substitutes that affect the competitiveness of Hong Kong Disneyland. Hong Kong is a cosmopolitan city that offers different entertainment activities: dining, nightlife and shopping. All of the organizations working in entertainment organize festivals and other events. Clubs, restaurants, bars also offer entertainment activities. Therefore, there are many potential threats for Hong Kong Disneyland (Porter, 1985).

Board Environment

Microenvironment consists of political, economic, social, technological and environmental factors.

Political Factors

Regulation of the business factor, defense, government spending, and legislation have a direct impact on decision making of Hong Kong Disneyland management. Besides, the factors set the rules for business conducting. As to Disneyland, the government does not hinder its development. Moreover, Hong Kong Disneyland has investments from the government.

Economic Factors

Economic factors of Disneyland Hong Kong are connected with unemployment and economic crisis that lead to reduction of customers. Economic factors have more negative influence on Hong Kong Disneyland than political ones, as economic factors concern recession in sales and profits. Economic environment of Hong Kong benefits Disneyland as it is substantially stable. However, world financial crisis affects Hong Kong as well. Strong economic environment can benefit development and growth of Disneyland (Barney, 1991).

Social Factors

Social factors of Hong Kong Disneyland are connected with English as an official language as it benefits social development of the company. The major benefit of English is that Disneyland has easy access to skilled labor supply.

Nevertheless, the company has to cooperate with its human capital. Many employees complain about negligence to their health needs. Moreover, employees are dissatisfied with management policy of the company, unequal treatment and discrimination. Therefore, Disneyland management has to address social needs of the human resources to increase employee retention and corporate social responsibility image.

Technology Factors

Technological factors are connected with innovations in services, and development of a strong supply chain in the management system. Hong Kong Disneyland invests in innovation; that is why it works excellently and efficiently. Besides, Disneyland develops their information technologies in order to attract more customers. The benefit of technological development is that business fosters a possibility to implement innovative advancement. In addition, the opportunity of technological factors is that it makes the company innovative and up-to-date (Subhash, 1996). However, the disadvantage of fast technology development is that it requires spending additional costs.