DizBiz: Message In a Bottle

First published October 22, 2002

By C. W. Oberleitner

In his follow-up column, DizBiz puts Pressler behind him and takes on the new head of Disney Parks and Resorts, Jay Rasulo.

What a difference a week makes. Even as the last DizBiz column, Of Julius Pressler, was being put to bed The Walt Disney Company was rushing the news of his successor to the world's press. Jim asked that I update the column to include something about Pressler's replacement, James – Jay – Rasulo the CEO of Euro Disney S.C.A. Not knowing that much about Mr. Rasulo I asked Jim to run the column as written and to give me some time to familiarize myself with Rasulo's promotion. I'm glad I did.

While technically caught with their corporate pants down – you always want to announce departures and replacements at the same time – Eisner and company moved swiftly to promote Jay Rasulo to president of Walt Disney Parks and Resorts worldwide. WDC public relations moved just as fast preparing the official announcement and organizing its release. It was no coincidence that the announcement came at a time when most of the world's major stock markets were closed and most media organizations operate with reduced staff.

The timing of the announcement also gave Disney a leg up in controlling the story. Coming on the weekend as it did the press release was quoted almost verbatim by every wire, net, and cable news organization eager to be first with the story. There was little to no analysis of its content. By Monday morning with the story already out and no time to chase down Rasulo sources most print media was left with little choice but to run the press release as is as well. Some print media, like Disney's hometown paper The Los Angeles Times were able to quote an unspecified interview with Rasulo himself.

The Times and several other major print outlets moved beyond the press release. They choose to focus on Rasulo's international business background suggesting that it was this global experience that gave him a leg up over the other Disney executive's being considered for the job.

To be sure there is a lot of merit in the in idea that The Walt Disney Company would want someone with Rasuslo's experience to head its parks and resorts division. Disney CEO Michael Eisner has been saying for sometime that he feels that the company has grown that division about as much as it can be here in the U.S. With the exception of expanding The Disney Cruise Line to the west coast and Hawaii there is little else in parks and resorts being planned stateside. Meanwhile Disney continues to publicly speculate about additional foreign market expansion.

So with so much of the world's press in such a hurry to get the story out was there anything in the press release about Jay Rasulo's promotion to president of Disney Parks and Resorts worth taking a second look at? Let's take a look.

In the previously mentioned interview given by Rauslo, presumably over the weekend of his promotion, he cautions people not to expect a quick turnaround in the theme parks. "I'm certainly not going to be able to turn around a fundamental world trend." But it is what he's quoted as saying immediately after that is far more interesting.

"Maybe we tilted the balance a little bit toward seeking efficiencies and cost reductions," he told his interviewer. In fact this phrase was the most often repeated quote from the interview.

Why is this phrase of particular interest? Because unlike everything else he said it isn't a generic reaffirmation of WDC's current corporate vision. This statement is a message, not just a response to a question. It is as close as you will ever come to hearing a Disney executive admit that the company made a mistake.

The question becomes who is the message for. It could be intended for the Disneyana community a portion of which had made Rasulo's predecessor Paul Pressler into one of the all time great Disney villains for placing cost cutting and the retail experience before Disney magic. It could have been a signal to the press that he gets "it" and that whatever he plans to do for the parks he already knows that further cost cutting could only make things worse. Or it could have been intended for a much more select audience.

Since early last summer when it was becoming apparent that park attendance would be off at all of the U.S. Disney parks there have been news stories about unrest among WDC's board of directors. Most of these stories were about the board's concerns over the lackluster performance of WDC stock. There was also, however, an as of yet unconfirmed story that suggested one or more of the directors was specifically dissatisfied with the way Parks and Resorts was being run.

According to this report Disney management was told that they had, in the case of theme park operations, gone too far cutting costs. The Disney theme park brand was at risk, management needed to do something to halt the negative press about the parks and get people back through the turnstiles. And, emulating local amusement parks and state fairs was not the Disney way to do it.

Although a reliable source for this story cannot be found there have been some interesting signals from Team Disney. As Jim reported here on JHM last month Disney CEO Michael Eisner has been on a one-man public relations tour telling virtually anyone who will listen, "I hear what you're saying. I understand your concerns. Trust me." It has even been said that the phrase, I get it turns up in conversations with him.

So when a man of Jay Rasulo's skill and experience tells the world that the division of the company he's just been tapped to run may have leaned a bit too far, "toward seeking efficiencies and cost reductions," you can bet he didn't just pull the idea out of thin air.

But WDC is still laying people off. If they get it and truly understand that they need some real Disney style attractions to juice up park attendance why did they layoff so many folks at WDI. Because until Jay Rasulo firmly takes the helm at Disney Parks and Resorts the ship is still on autopilot and being manned by the same group of accountaineers that believe all people really want to do when they visit a Disney park is shop.

Jay Rasulo's "global" experience notwithstanding the balance of his career with Disney is also very impressive. He joined the Walt Disney Company in 1986 in Corporate Strategic Planning where he led strategy development for all real estate-based businesses in The Walt Disney Company portfolio. He was senior vice president of Corporate Alliances from 1993 - 1995, organizing the sponsorship activities into a company wide strategic business unit. Rasulo also spent three years with the Disney Regional Entertainment business where he was part of the development of ESPN Zone. In 1998 he moved to Paris to assume the position of executive vice president, Euro Disney S.C.A. In May of 2000, Rasulo was named Chairman and CEO of Euro Disney, S.C.A.

Perhaps the most interesting part of Mr. Rasulo's resume is the two years he spent as vice president of Corporate Alliances. If there is one part of Disney Parks and Resorts that comes under fire more often than park operations it would have to be theme park corporate alliances. From George Lucas to General Motors relations between Disney theme parks and their corporate sponsors have never been worse. And that sponsorship is needed now more than ever.

Even with the drastic cuts in staff at Walt Disney Imagineering, Internet chat rooms and Disney rumor sites have been full of stories about all sorts of projects and plans on the boards at WDI's Glendale headquarters. Most of the speculation centers about the re-imagineering of classic Disneyland attractions in time for that park's 50^th anniversary; however, stories of heretofore unheard of E Ticket attractions are also making the rounds.

While it remains to be seen which if any of these projects come into being one thing seems clear. Team Disney in Burbank may be beginning to realize that if they wanted to increase park attendance in the post 9/11, world they are going to have to give people new reasons to come to the parks.

It should be pointed out that Disney is not the only theme park operator to be disappointed by a lack of paying guests. Many of the biggest names in the industry reported lack luster attendance this past summer. With one exception all of Six Flags U.S. parks reported lower than expected turnout. That one exception was Six Flags Magic Mountain in Valencia, California.

What was it about Magic Mountain that brought in paying guests while attendance was off almost everywhere else? Blind dumb luck. Thanks to a series of mechanical problems X The Extreme rollercoaster, which was to be the big new draw at Magic Mountain for the summer of 2001, became the weenie – as Walt Disney used to say – that brought in the crowds for the summer of 2002.

If you build it they will come is the unofficial motto of theme park operators everywhere. Even though Disney spent billions developing Animal Kingdom at Walt Disney World in Orlando and Disney's California Adventure they cut the must see, could only be done by Disney big E Ticket attractions from those parks in favor of more shops and restaurants. To make matters worse they lost corporate sponsorship for Rocket Rods, cut corners on the rest of Disneyland's new Tomorrowland and haven't "imagineered" a new attraction for that park since 1995's Indiana Jones Adventure.

So the problem for Eisner and company becomes one of, I need new attractions to bring people back to the parks in significant numbers but I can't use more of the company's money without risking the further wrath of Wall Street and the investment community. What do I do?

The answer to that question comes right out of business management 101. Use someone else's money. In this case the money from those corporate sponsors that are currently less than enthusiastic about working with The Walt Disney Company.

The California Adventure version of Tower of Terror isn't due to open until 2004 and already the plans for DCA's next big E Ticket import are being finalized. All that's needed to insure this international favorite gets built in DCA is a good solid sponsorship deal.

The previous DizBiz column posed the question of how Disney and Paul Pressler's successor would be able to raise attendance without drastically raising spending at the theme parks. Perhaps they've found the answer by promoting a man with an excellent record of operating an international destination resort and a history of improving the company's corporate alliances.