THE MARKETING OF WALT DISNEY 5
The Marketing of Walt Disney
How did Disney create its uniqueness in the media and entertainment industry? What are their sources of competitive advantage?
Disney is a market leading company in the segment of entertainment. Being a strong brand requires one to have a top level of creativity in the management, both leaders who have recently been holding the top management posts (Michael Eisner and Robert Iger) have been receiving praise for embracing creativity (Roels, 2018). Disney has been able to diversify its services and therefore, revenue streams. The Walt Disney franchise has been developing a portfolio that consists of four key businesses, thus ensuring that they diversify their income. Disney has acquired different franchises, which are producing good returns.
Two of the pillars that have helped Disney gain a competitive advantage over other players in the industry are the international expansion pillar and the technology pillar (Boorstin 2013). Technology at Disney is a top priority, for example, when Robert Iger took over, he assigned himself the position of chief technology officer (CTO), therefore demonstrating the importance of technology in the company. Disney has a global presence in terms of its services, products, and brand recognition. The pillars have ensured that Disney maintains its competitive edge.
How is the media and entertainment industry being disrupted?
Companies are engaging in more corporate strategies of vertical integration and expansion of scope through product diversification (Roels 2018). The companies are now focusing on themselves to ensure that they deliver quality products to the customers rather than spend heavily on marketing though they still do product promotion. The companies are more focused on the ability to lower costs, improve quality, and invest in specialized assets and secure critical resources, for example, supplies and distribution channel. Product diversification ensures that companies have multiple revenue streams, and the competencies of different people are well utilized. Disney has been embracing the changes and maintaining its leadership in the industry.
Portfolio management: The Walt Disney Company has a portfolio that consists of four key businesses: television networks; parks and resorts; film studios; and consumer products. Please research these segments to determine where each belong on the BCG matrix. Identify where each fit and provides rationale for your answers.
Additionally, where will the new streaming service be on the market?
The four key components of the Walt Disney Company are profitable at the moment. The television networks are currently productive though their revenue has been affected by competition from streaming services, they have maintained their profitability, therefore, making it a cash cow. Parks and resort have been expanding, putting them at the level of a cash cow. Film studios have been very productive in producing great movies which have boosted the Disney revenue. Consumer products such as Disney publishing worldwide and Disney store are very profitable though still relevant; they are the star of the company.
The new streaming service is a star in the corporation. There is a lot of investment that is being pumped into the streaming service currently for its development (Inamdaer and Rothaemel, 2017). Though it will face a lot of competition from other streaming services such as Netflix, the company chief executive officer Robert Iger has been optimistic that the service will be profitable by the year 2024. Disney expects to bank on the reputation of BanTech LLC, which has been proven to be very useful in the streaming service. Within a few years of operations, the company will be profitable and therefore become a cash cow then, but for now, it is still a star with a lot of potentials.
The Walt Disney Company creates value globally across multiple dimensions. They claim to have high standards of corporate social responsibility and be conscious marketers. Describe.
Disney, as a company, recognizes the importance of working with the community in different aspects. One crucial element that Disney has successfully handled and resonated positively with the community is the decision to make a stand on childhood obesity (Chan 2011). They have employed strict standards on food advertising that is focusing on the children on Disney owned television networks, websites, and radio stations. One negative part where Disney is lagging is the environment conservation; they are very slow to implement the programs that they agreed on regarding sourcing of their papers. Overall Disney has been trying to be a leader in the corporate social responsibility.
What type of growth strategy is the start of Disney+
The streaming service is using the market penetration strategy. Disney is introducing a new product into the market; they tried introducing the streaming services to the market earlier but failed. The best approach would, therefore, be going the market penetration way which will ensure that they test how the streaming service has the potential to grow and capture a specific percentage of subscribers (Valentine 2015). Market penetration does not require Disney to make radical changes to their operations. Thus, it will be the easiest method to introduce a streaming service.
(a) The Walt Disney core competencies
(b) Key competitors
Disney, as a corporation has unique competencies since it employs several great employees. The most valued skill of Disney is the ability always to produce creative content (Roels, 2018). Disney has also invested a lot in technology; they strive to always remain ahead in the technology, especially in the production of movies. Disney has different competitors in different areas where they are operating. For services such as television and theme parks, they have competitors such as time warner incorporation and six flags entertainment respectively.
(c) pick three of the six macro-environmental factors that you believe will have the most impact on Disney`s success in streaming and explain why you believe this factor is a critical concern,
Technology is a factor that will be essential in moving the streaming service forward; this is because technology will ensure that the streaming service is available to subscribers through the provision of smartphones (In Fati et al., 2018). The economic factor will also play a role in ensuring that the subscribers can afford the streaming program, though the service is relatively cheap than the competitors. The population distribution will also be critical in moving the streaming program forward; the demography will help in targeting customers.
References
Noorein Inamdar, Frank T. Rothaermel (2017) The Walt Disney Company
Guillaume Roels, (2018) Reshaping Disney`s strategy for the digital age
In Fati, S. M., In Azad, S., & In Pathan, A.-S. K., (2018). IPTV delivery networks: Next generation architectures for live and video-on-demand services.
Valentin, E. K., (2015). Business planning and market strategy.
Chan, A. J. (2011). Navigating shark-infested waters: Corporate social responsibility and culture at Hong Kong Disneyland.
Boorstin, J. (January 01, 2013). Disney’s ‘Tween Machine – How the Disney Channel became must-see TV-and the company’s unlikely cash cow. Fortune, 148, 6, 110.