The “era of blindly following Mickey Mouse” is over, says Chinese tycoon Wang Jianlin, whose Dalian Wanda Group operates a theme park in China’s eastern Jiangxi Province; but, competition for the Chinese entertainment conglomerate is heating up as Shanghai Disneyland opens Thursday.
Richard Huang, who analyzes China’s entertainment industry for Nomura investment bank, said there is plenty of room in the Chinese market for both Disney and Wanda to thrive.
He says,“Both of them benefit from the under-investment the country has made in these entertainment venues. Because even in major cities like Shanghai there are no international standards or world class standard parks.”
Competition heats up
Tickets at Disney’s $5.5 billion Shanghai park will cost about twice as much as those to the Nanchang Wanda Park, but Disney says the high prices will prevent overcrowding. Disney’s park is also twice as large as the Wanda park and boasts the biggest Disney castle in the world. The Wanda park says it has one of the largest roller coasters and the highest free-fall ride in China.
As both media companies step up production of films targeting Chinese consumers, the biggest movie market in the world, the theme parks may provide a valuable means of increasing brand recognition and fans. In turn, the parks’ success will also rely on the ability of the media companies’ productions to capture the imaginations of China’s youngest consumers.
Tiger Zou is a partner at Ent Group, a Chinese entertainment consulting firm.Zou said, “Before looking into anything, we have to take in mind that it is only the first month the Shanghai Disney park is open for business. From my perspective, Disney has been increasing in influence with its success in the movie industry with films such as Frozen. This success, in my perspective, has helped Disney to earn its position in younger children and in turn, has attracted people to go to its theme park.”
Protecting intellectual property
Disney stars may also be attracting people to the theme park owned by Wanda. When Wanda’s Nanchang park opened last month, performers dressed as Snow White and Captain America greeted children throughout the grounds, prompting Disney to issue a warning to Wanda that it is prepared to take action to protect the company’s intellectual property rights.
Elliott Weiss, a University of Virginia professor who has written a case study on Shanghai Disney, said Disney is likely to face more hurdles as it builds its brand in China, but that its efforts will be rewarded by the vast number of potential theme park visitors.
Weiss said, “The history of Disney parks is when they go to Europe and Paris and Hong Kong and Tokyo, they always get some things wrong, and it takes awhile to react to that. They do their best to anticipate what the market will bear, but there are always some customs that they may not get right, so it may take a while to adjust, but eventually, if there are 330 million people within a three-hour drive, the market is clearly there.”
China’s boom in domestic tourism, with a 13 percent rise in revenue last year, should help draw visitors to the new theme parks. Disney expects 15 to 30 million visitors a year to its Shanghai park. Wanda plans to open a total of 15 theme parks and complexes during the next four years.