Why Shanghai matters

In the US the annual growth rate of the leading Disney parks is about 2-4 percent, but half of the top-20 parks barely grow or are still contracting. In Asia Pacific that figure was 5 percent.

The early growth of the pioneering Chinese parks is in a class of its own, as shown by Songcheng Park Hangzhou (38 percent), Window of the World in Shenzhen (11 percent), Happy Valley in Beijing (8 percent) and Shanghai (4 percent).

Last year, Disney’s revenues soared to US$48.8 billion. Of the total, parks and resorts accounted for over US$15.1 billion. And yet, almost all of the increase stemmed from domestic operations.

With the Shanghai Disneyland, that is about to change. It will raise the bar for quality and guest experience. It will set a leading price point in the market.

In the past, Disney has been regarded in the advanced economies as a global company with universal characters. In reality, it is still a very American company. Even today, international markets represent barely a fourth of Disney revenues. Asia’s role is about 8 percent for this total. However, these figures do not yet involve the large emerging economies in Asia.

Shanghai Disneyland has potential to boost emerging Asia’s role in Disney’s revenue flow, while it could spawn a new generation of competitive Chinese theme parks. Now that’s a true win-win.

Dr Dan Steinbock is a columnist with China.org.cn. For more information please visit:http://www.shenbo75.com/opinion/DanSteinbock.htm

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