9 May 2005 was Oriental Land Co., Ltd. (“OL”) changes in the company’s top management. They felt the heat not only from the wet weather in Tokyo during the rainy season, but also as a result of the number of visitors who had only in. the total combined attendance at Tokyo Disneyland Park and Tokyo DisneySea Park come for the fiscal year (April 1 2004 to 31 March 2005) amounted to 25.021 million visitors, 98.2% of the previous year’s attendance. The top management was concerned that th … Read more »

9 May 2005 was Oriental Land Co., Ltd. (“OL”) changes in the company’s top management. They felt the heat not only from the wet weather in Tokyo during the rainy season, but also as a result of the number of visitors who had only in. the total combined attendance at Tokyo Disneyland Park and Tokyo DisneySea Park come for the fiscal year (April 1 2004 to 31 March 2005) amounted to 25.021 million visitors, 98.2% of the previous year’s attendance. The top management was concerned that this decrease in the presence of a bad sign for hard times could be ahead and it was a prime example of a successful foreign investment in Japan now caught in a completely new structural change. The factors that are critical to its past success had been, now decreasing. The top management thought that the amusement park and leisure industry country provided little cause for optimism, due to factors such as declining consumer spending and demographic changes. Under these conditions, the top management that a study was needed to determine if OL was able to diversify its base of operations. They specifically wanted to know whether the current pricing policy has been effective in deflation, the Japanese economy had suffered for a long time, and how changes in the pricing for the visitors, when necessary, the company’s cash flow would affect in the future. The new pricing policy would be on the price elasticity of demand by visiting the company services.The top management asked the Planning Department to study the possible price changes and use net present value (“NPV”) is based methods to these alternatives to evaluate the effect of future cash flows. The strategy would also need to integrate the company’s long-term strategies.
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from
Mitsuru Misawa
Source: University of Hong Kong
17 pages.
Release Date: 1 November 2012. Prod #: HKU986-PDF-ENG
Tokyo Disneyland (3): New pricing policy for sluggish demand HBR case solution needed

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