Walt Disney in China (Part1)

The Disney case that professor had been presenting in class triggered my interest to look into this world largest media conglomerate’s story in China. As everyone knows that Hong Kong Disney land is Disney’s first move to test the water in Chinese market and data display that Disney’s performance is far from resounding: Disney's annual visitors in Hong Kong are still about 25% below original targets set at the park's opening. In its first year, Disney's Hong Kong Park attracted 5.2 million people, below its goal of 5.6 million. Visitor numbers fell 20% in the second year to just 4 million, and grew to 4.5 million visitors in the 2007-2008 fiscal years, still far below the numbers it hoped to draw. We have pointed out several reasons leading to Disney’s failure in China and I’d like to supplement some other factors that were outlined in a TV interview I came across, with Zhizhong Zhang, the managing director of Disney China, who has many years of excellent working experience in FMCG industry.

Zhang stated two insurmountable barriers Disney had to go through in China market: one is the Chinese government strictly confines the number of importing foreign movies, 20 films in each year. Another block is Disney Channel still couldn’t be allowed to land on China. In order to break up these limitations, Zhang and his colleagues were falling over themselves to lobby Chinese government time after time.

Simultaneously, Disney China focused on cultivating its product line: for example, Zhang demanded his manufacturers to control and manage producing process and ensure to provide customers products, like clothes, shoes and toys with superior quality. He firmly believed that customers are willing to purchase clothes in a Disney store no matter how familiar they are with Disney stories as long as they could be offered good products. Moreover, on the basis of the boom of China's English education industry, Zhang creatively initiated a Disney English teaching program , which is the first and also the sole trial within Disney on the worldwide. What’ more, Disney China was seeking positive cooperation with local media companies. For instance, Disney along with China Film Group Corporation filmed a movie called “The Secret of the Magic Gourd (Bao hu lu de mi mi)”. Another instance is Disney took advantage of the marketing weakness of Chinese local cartoon production companies and persuaded them to let Disney take charge of their R&D and sales of derivatives. One of most well-known animated cartoons amongst these for Chinese audiences is “Happy Goat and Big Big Wolf”.