Tokyo Disneyland (3): New Pricing Policy Needed For Sluggish Demand Harvard Case Solution & Analysis

May 9, 2005, Oriental Land Co, Ltd ("PR") has announced changes in the top management of the company. They felt the heat not only from the wet weather in Tokyo during the rainy season, but as a result of numbers of visitors who are just entering the total combined attendance at Tokyo Disneyland Park and Tokyo DisneySea Park during the financial year (1 April 2004 to 31 March 2005) was 25021000 visitors, 98.2% attendance for the previous year. Top management is concerned that the decline of attendance can be a bad sign of difficult times, and it was a shining example of successful foreign investments in Japan now got a completely new structural changes. The factors that were important to his past success is now declining. Top management believes that the amusement park and leisure industry provides little ground for optimism, due to factors such as the weakening of consumer spending and demographic changes. In these conditions, the top management believes that research is needed to determine the PR may diversify operating base. In particular, they wanted to know whether the current pricing policy has been effective in deflation, which the Japanese economy has suffered for a long time, and as changes in the prices to the public, if necessary, will affect the company's cash flow in the future. The new pricing strategy will be based on the price elasticity of demand by visitors services.The. company's top management has asked the Planning Department to study the possible changes in the price and the use of net present value («NPV») methods to assess these alternatives on the impact of future cash flows. This strategy should also include long-term strategy. "Hide
by Mitsuru Misawa Source: University of Hong Kong, 17 pages. Publication Date: November 1, 2012. Prod. #: HKU986-PDF-ENG

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Tokyo Disneyland (3): New Pricing Policy Needed For Sluggish Demand

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