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Euro Disney

Euro Disney

Question 1: What issues are at the heart of euro Disney’s problems? Why?
When the project (cultural Chernobyl) opened, there were some major assumptions of the model that unfortunately were revealed to be inaccurate, not only in terms of attendance of the park, but also mainly on the real estate side of the project. There were overoptimistic projections at that time, and it was a time in the early 1990s when the real estate market, especially in France and Europe, was booming and there were very optimistic projections about the speed, the size and the kind of price Disney would get form the land development. The downturn of Paris real estate market affected the sales of hotels. The attendance was below the expected rates (See Appendix I).
The second major issue was the whole tourist destination including the park was over invested form the beginning. Costs skyrocketed and Disney managers could not price the entrance to the park at the right level to pay for those costs and at the right level to be affordable by the Europeans during the recession (See Appendix II).
Disney had to define their branding decisions based on a thorough understanding of the idiosyncrasies of the customers they

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