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 China matters for Mickey Mouse's owner: its box office
takings there have tripled over the last two years and Shanghai
Disneyland has seen more than 10 million guests in its first
year, setting it on track for faster profits than Disney reaped
from parks in Paris and Hong Kong, both loss-making for most of
the years they have been open.
The company was "extraordinarily encouraged" by the number of
guests who visited Shanghai Disneyland and the satisfaction
scores it received, Bob Chapek, head of parks and resorts, told
reporters.
"I think those are the sort of right precursors, if you will,
for future development," he said when asked about expansion
plans.
"We're very encouraged by what we've seen."
Disney released 10 films in China last year, including "Zootopia"
and "Star Wars: The Force Awakens" with ticket sales of about $1
billion, according to box office tracker EntGroup. That was up
from four films and $313 million in 2014.
Last month, it rolled out the red carpet in Shanghai for a rare
world premiere of the latest film in its "Pirates of the
Caribbean" franchise. Stars Johnny Depp, Orlando Bloom and
Javier Bardem made an appearance.
It has also been tying up with partners like state-backed
producer Shanghai Film Group, its digital subsidiary BesTV for
online content, and Shanghai Shendi, its partner for Shanghai.
Now, for the first anniversary of the Shanghai park, it will
celebrate Disney-style, with lights, fireworks and visits by
executives including Chapek and Chief Executive Bob Iger.
Chapek said their hotels at Shanghai Disneyland had hosted
almost 750,000 people and had maintained occupancy levels
significantly higher than the overall market.
Guests were also spending more time at the park than
anticipated, averaging about nine hours, he said.
BROADENING BUZZ
But along with the hotel rooms and rides, Disney is pursuing a
steadier path to build brand and profit in downtown classrooms
in six Chinese cities, where children study English with the
help of Winnie the Pooh and Captain America.
"With the theme park, films, co-productions, Disney English and
retail, they're creating an ecosystem to bring consumers in and
foster a broader buzz and awareness," said Ben Cavender,
Shanghai-based principal at China Market Research Group.
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"The aim is to recreate that feeling in the U.S. where you have
multiple generations who know the characters and cartoons."
Disney said China was a strategically important market.
"Not only is it home to Shanghai Disney Resort, our largest ever
foreign investment, but it has a thriving studio, consumer products
and media distribution business," it said in a statement.
Disney is hiring for schools in cities including Beijing, Shenzhen,
Chengdu and Shanghai - all decorated with Disney characters and
motifs.
It has not all been plain sailing. Disney was forced to launch an
investigation this year after an employee was found to have set up
firms which made deals with local authorities using the Disney name.
Local children are also more used to Asian cartoon heroes, while
Disney faces caps on imported films, partial bans on foreign
cartoons on TV and long-established domestic theme park rivals.
However, for 7-year-old Sunny Sun who has been attending classes
once a week at Disney English for the past two years, Disney
characters are now familiar.
Her mother, freelance writer Happy Chen, plans to take her to the
Shanghai park this summer, and says her daughter goes to almost
every new Disney animation at the cinema.
"Now she really yearns to go to the Disney park," said Chen,
pointing to the crossover between the classes, films, characters and
the theme park.
"It's all connected."
(Reporting by Adam Jourdan; Additional reporting by Brenda Goh and
SHANGHAI newsroom; Editing by Clara Ferreira-Marques and Chris
Cushing)
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