Tokyo Disneyland: The New Pricing Case Analysis
Tokyo Disneyland – new pricing
Case analysis
A summary for the board of the company
Team of consultants: Desislava Dobreva, Georgi Stamenov, Toma Koleliev, Yavor Kolevski
Strategic Management, Prof. Dr. Richard Mischak MBA, AUBG, 2014
19/03/2014
Agenda:
I. Executive Summary
II. Introduction
III. Main body of the report
IV. Conclusions and recommendations
V. List of references and bibliography
VI. Appendices
I. Executive Summary
Tokyo Disneyland considerations regarding the need of changes in the pricing policy, based on the expectations for “sluggish demand”.
In 2005 the company operating the Tokyo Disneyland Park and the Tokyo DisneySea Park – “Oriental Land” Ltd. (OL) has changed its top management because of the decrease in the number of guests, compared to the previous year.
OL’s top management asked the planning department to study the following scenarios:
Case 1 – rise prices by 5% in 2006, the number of visitors will decrease by 1% a year for five years;
Case 2 – lower prices by 5% in 2006, the number of visitors would increase by 1% a year for five years.
After presenting the calculations for NPV for such scenarios, the planning department received the next task from the top management – to conduct a sensitivity analysis for the following:
Case 3 – if rise prices by 5% in 2006 and additionally by 2% a year for 2007-2010, the number of visitors will increase by 1% a year for five years;
Case 4 – if lower the prices by 5% in 2006 and additionally by 2% a year for 2007-2010, the number of visitors will increase by 1% a year for five years.
The results from the NPV analysis were:
So the findings by the planning department had key points for consideration:
1. The target of at least 1% increase in the number of visitors per year needs to be maintained in the future.
2. The reason for the decline in visitors were:
a. Decline because of new competitors of such services;
b. Prolonged recession and growing inflation.
3. The
Case analysis
A summary for the board of the company
Team of consultants: Desislava Dobreva, Georgi Stamenov, Toma Koleliev, Yavor Kolevski
Strategic Management, Prof. Dr. Richard Mischak MBA, AUBG, 2014
19/03/2014
Agenda:
I. Executive Summary
II. Introduction
III. Main body of the report
IV. Conclusions and recommendations
V. List of references and bibliography
VI. Appendices
I. Executive Summary
Tokyo Disneyland considerations regarding the need of changes in the pricing policy, based on the expectations for “sluggish demand”.
In 2005 the company operating the Tokyo Disneyland Park and the Tokyo DisneySea Park – “Oriental Land” Ltd. (OL) has changed its top management because of the decrease in the number of guests, compared to the previous year.
OL’s top management asked the planning department to study the following scenarios:
Case 1 – rise prices by 5% in 2006, the number of visitors will decrease by 1% a year for five years;
Case 2 – lower prices by 5% in 2006, the number of visitors would increase by 1% a year for five years.
After presenting the calculations for NPV for such scenarios, the planning department received the next task from the top management – to conduct a sensitivity analysis for the following:
Case 3 – if rise prices by 5% in 2006 and additionally by 2% a year for 2007-2010, the number of visitors will increase by 1% a year for five years;
Case 4 – if lower the prices by 5% in 2006 and additionally by 2% a year for 2007-2010, the number of visitors will increase by 1% a year for five years.
The results from the NPV analysis were:
So the findings by the planning department had key points for consideration:
1. The target of at least 1% increase in the number of visitors per year needs to be maintained in the future.
2. The reason for the decline in visitors were:
a. Decline because of new competitors of such services;
b. Prolonged recession and growing inflation.
3. The