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Strategic Managment of Walt Disney Company

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    The Walt Disney Company’s Parks and Resorts sector holds and controls the Walt Disney. The Walt Disney Company maintain complex branding, such as ESP., Walt Disney Animation Studios, Paxar Animation Studios, Disneyland Park and so on. It is challenging for Disney to manage ranges of brands. Disney should well manage or simplify the branding, such as collapsed some brands and remain the others in order to keep the Disney family brand remain a clear and distinguish image. Disney is different. No competitor in the entertainment industry can evoke the wholesome family goodness of Disney.

    Having said that, Disney took a unique positioning compared to its main competitors and has worked continually using ireful brand management to maintain its image. Its founder aimed to create universal timeless entertainment that could be enjoyed by the whole family. Disney products create a “warm, safe, and family-oriented” feeling. Over the years, Disney maintained and developed this image by attempting to retain control over the complete entertainment experience. First, cartoons, unlike actors, could be perfectly controlled to avoid any negative imagery.

    Second, the company tried to have full ownership of most operations involved with its products and services. For example, Disney was quick to buy back virtually all operations within the Disneyland theme park. They also vertically integrated and brought the distribution channel in house. Lastly, Disney understood that good positioning requires trade-offs and refused to take part in any activities that could generate short-term profit but would reduce its identity or control over it. Additionally, the company reinvented the amusement park with Disneyland and created an innovative park that would become the reference for decades.

    This foresight allowed Disney to capture a large share of the market and to enjoy first mover advantages such as being ahead of the learning curve or being perceived s the pioneer brand. This document is about the marketing strategy that Disney have followed to promote its products to be well known all over the online and offline communities. Introduction The Walt Disney Company is the second largest media and Entertainment Corporation in the world, after Time Warner. It was founded on October 16, 1923 by brothers Walt and Roy Disney as a small animation studio.

    But now it has become one of the biggest Hollywood studios, and owner of eleven theme parks and several television networks, including the American Broadcasting Company (BBC). The Walt Disney Company’s corporate headquarters and primary reduction facilities are located in California at the Walt Disney Studios. The headquarters is located in US large-scale Multinational Corporation. The primary service manufactures including the entertainment programs, parks, toys, books, computer games and media networks. The Miramar movie, Hollywood Movie Company, the ESP. sports, the BBC television network all it is under the company brand.

    The four As of Walt Disney 1. Price: While at the Walt Disney World theme parks, you are continuously offered other products services to purchase. * Upon exiting attractions, you enter a store themed to that attraction with gifts. During travel on trams, monorails, trains, boats, etc. There are always marketing announcements. These recordings inform you of ways to upgrade your ticket, to stay longer, to visit other parks, dine in the restaurants, to stay at resorts or to go to other attractions. * Booths in the parks have representatives selling Disney vacation packages for future visits. Stores with gifts and restaurants with food are on every corner for your convenience. Disney knows that current customers are the easiest customers to up sell. As a result, they take every opportunity to sell you more, concluded Drew(2006). 2- Place Walt Disney World in Orlando, attracts visitors from all over the world, as does Disneyland in California. However, Disney realized they could grow their business if they offered their product to other marketplaces outside of the USA. As a result, they developed country specific theme parks and delivered them to these marketplaces.

    Disney built a Disneyland Paris, a Tokyo Disney, Hong Kong Disneyland and Shanghai Disneyland Resort. These parks bring in many visitors, as well as many repeat visitors who would not have traveled to the USA mentions Drew(2006) Disney has increased their marketplace and expanded heir brand worldwide by building these country specific theme parks. Your Internet business can again follow this business principle and do it with less of an investment. It’s as easy as developing your site in other languages and then submitting your site to search engines in those languages. – Promotion Walt Disney World never stops doing the advertisement, it is a continuous process. They have a certain budget for marketing and are always trying to keep their name in front of audience. You can constantly see their advertisement on television, in newspapers and magazines, on the Internet and so on. Disney are trying to send emails to their current and past customers with different offers as well; their promotions are just designed to keep them in your mind. As a result, most people are thinking to spend their family vacations in Disney World or Disney Resort.

    Disney does not have one specific target market, it focuses on each member of the family. It mainly targets average income families, who live in urban areas. 4- Product Disney is always growing, building, expanding and improving. With their existing theme parks they continuously work to add in new attractions and shows. They update old outdated rides, as well as modernism long standing favorite rides. Disney is constantly creating new products to sell. The most well known of their products are their movies. Disney studios is always working to create new motion pictures.

    Constantly making and releasing movies to the marketplace brings in consistent profits for Disney. The synergy Disney has developed between their theme parks and their movies, which helps to drive movie sales in theatres as well as on DVD’s and leads to increased sales of their dolls, toys, games; as a result continues to bring more visitors to the parks. Promotion Mix The Walt Disney Company is very strong in entertainment and animation, the two areas do fairly well in the global market, but just because a company has its strengths doesn’t mean its going to successfully sell its product without advertising (The Walt Disney Company,2011).

    Advertising is essential, without advertising we wouldn’t know about half the products we use. In this case we are talking about Disney’s animated films, therefore Disney uses product advertising which is a form of advertisement that touts the benefits of a specific good or service. In order to advertise a product, a company must first select n advertising appeal which identifies a reason for a person to buy a product. Disney uses the “Fun and Pleasure” appeal to advertise their animated films. Next, the company must choose a style to execute their message.

    Disney uses the “Mood or Image” execution style for advertising which builds a mood or image around the product such as love, happiness, or inspiration (The Walt Disney Company,2011). For example, whenever you feel a certain emotion after watching a Disney movie trailer, that’s their “Mood or Image” tactics working on you. After the company has established how they are going to advertise, they just determine which types of media will best communicate the benefits of their product or service to the target audience and when and for how long the advertisement will run, this is called media planning.

    Disney advertises through newspapers, their own radio station – 1560 AM @Radio Disney, television, internet, and outdoor media. Of course each media type has its advantages and disadvantages, but because Disney has such a powerful brand name and history, they end up having more benefits than losses. SOOT analysis 5. 1 Strength The Walt Disney Company’s main strength is in its resources, its experience in he business, and its low-cost strategy. Besides, the company has developed clearly a very strong and well known “brand-name” through many years.

    The company has also been able to diversify its operations and products to hedge against decreasing sales in product lines. In recent years, it has categorized into Home Video, Film, merchandise, Radio broadcasting, Net-work television and in theme parks. It has also effectively diversified globally its operations from USA to Japan and Europe. The main strengths in internal resources relate to human resources and financial stability. Employees in the Walt Disney Company studies appear to be extremely creative and they have produced several box-office productions in these recent years.

    A company without new ideas is bounded in today’s competitive business environment. However, the low-cost-corporate- strategy is a benefit for the company. The company can control costs, and still produce quality goods and services. Financial risks have been minimized by sharing initial investment costs with a maximum number of outside participants. Weaknesses Corporations always have internal weaknesses. The Walt Disney Company’s main weaknesses are the following: A very large work load, often changes in top-management, and high overhead expenditures.

    The company has 58,000 employees in 1991. This fact represents possible communications problems, and a high bureaucracy level through the corporation. The company’s work load will increase even larger, and the organizational structure has to be able to support an extension of the work load by varying into more businesses and niches. The company has a very frequently changes and its corporate officers makes the corporate structure even more difficult. There are many positive things that often hinges, but the changes are also associated with resistance, and high expenses. SCRIBED, 2008) opportunities External opportunities should be recognized, analyses, and responded to in a very early stage. The Walt Disney Company is facing several external opportunities. However, the external threats facing the company are out- numbering the opportunities. Opportunities include the following; positive government attitudes towards its operations, barriers of entry are significant, and include the entertainment industry itself. Legal and legislative forces are usually identified as negative external factors to the company.

    Furthermore, the French government contributed greatly in the Euro Disorderly project in the Walt Disney Company’s case. The French government invested in the project to build communication facilities, and gave the Walt Disney Company tax relief’s on cost of goods sold accounts. In addition, since the barriers of entry into the highly specialized industry in which the Walt Disney Company is still operating, competition will find it difficult to penetrate the company’s highly diversified product or service mix. Therefore, large initial capital investments are required to enter the industry accordingly. SCRIBED, 2008) Threats Major threats to the Walt Disney Company include the following; Over saturated markets, politics and economic aspects from a global perspective, and foreign competition. As the supply of products and services in the entertainment industry is starting to saturate the markets, competition will be more exciting, and only the most powerful companies will be able to survive finally. The Walt Disney Company has leveraged this risk to a certain level as it has diversified and globalizes its operations, but still, the company is in the service/entertainment business.

    The Cable-giants such as Turner Broadcasting Systems (TABS) may not e able to manage the stress on its operation such as the Network-television division. (SCRIBED, 2008) conclusion Walt Disney is a master in globalization. It is one of the largest companies on the planet. Disney tries hard to create the big amount of revenues in the markets and worldwide itself in order to establish itself become as a global brand. Afterwards, the brand has been further developed as a result of merchandising. Merchandising has definitely played an important role in establishing the brand all over the world.

    An important factor in the success of Disney has been the integrated nature of its products, with synergies between film and television, between media and theme parks, and between theme parks, hotels and resort operations(Bill Faulkner, Eric Laws and Giant Mascaras, 1998, p. 371) Recommendations Maintain core brand value with innovative technologies Disney should maintain its historical core value of creating fantastic and magical memories for families, which help Disney to be distinguished from its competitors.

    However, the products created with existing cartoon characters or a new character should keep innovative in order to keep the brand fresh. Avoid overextension and overexposure Disney is a worldwide well-known brand, which involves numerous business, including broadcast, cable, radio, publishing, animations, films, toys, media, theme parks and so on and it keeps impressing customers every day. Disney should avoid overextension and overexposure; it can make difficult to monitor the company and lower the operations effectiveness and efficiency, or even affect customers’ feeling to the brand.

    Creating new products for Disney Company Our objective is to be the voice of the consumers within the organization. High- quality market research has helped secure the long-term future of the business. Analyzing and understanding the data gathered on consumers’ behaviors, needs, attitudes and opinions minimizes the risks involved in making marketing decisions. They help the central research team in gathering and interpreting consumer views. These views provide information or insights that ultimately result in the development of new products suitable for a global market.

    This case study follows the development of a new Disney cosmetics called Young Beauty aimed for kids, from both boys and girls. This case study will give you a clear picture of how market research has helped New Product Development NYPD). The New product Mainly this product is offered for the kids for them to start using cosmetics like their parents, both boys and girls, since children always imitate their parents in even small things, and thus Disney thought of pitching the market with this product. The idea was to have a safe product for the kids’ skin that gives the same look of the adults without affecting them negatively.

    Market research should start with the consumer and serves two purposes: 1) To inform companies about consumer needs and desires. What are the trends in the market? What do consumers want? ) To give consumers the opportunity to talk to the providers of products and services so that their views will be taken into consideration. Businesses exist in a fast-moving world with increased consumer choice, that is why it is essential that Disney wants to know the market and the consumers before developing any new product. Lots of questions need answering. Consumer insights drive New Product Development.

    This information takes into account their behaviors, attitudes and beliefs. It is an expression of their wishes and desires. Businesses use consumer insights to create opportunities for their brands. It is the starting point that enables brands to fit meaningfully into consumers’ lives. Across countries, consumers are different in terms of culture and lifestyle. Disney challenge was to find similar insights from consumers across different countries. This was used to optimize product development. Research The research team felt therefore there was not enough recent knowledge about the consumer in their researches.

    They commissioned some primary qualitative research in key markets (Germany, France, UK and USA). This was aided by the local Market Research Manager. The aim was to understand the motivations or using cosmetics among children. Primary research is used when there is no existing data available to answer your questions. Results of the research The market research revealed an explored market potential for Disney cosmetics. No direct competitor was offering a product to meet these needs, so there was a clear opportunity to develop a new product.

    This would fit across different markets and with the current Disney cosmetics range. Turning consumer insights into product concepts Consumers showed a need for a “beautifying, caring cosmetics that is safe for kids”. The team generated ideas on how to address the consumer needs. From these ideas the marketing team created ‘product concepts’, it describes the product benefits and how they will meet the consumer needs. Several concepts were written in different ways. These explained and expressed unique product attributes. The company needed to know which concept was preferred by prospective consumers.

    It carried out market research to test whether the concepts would work. The research was conducted amongst the desired target market. For Young Beauty, the desired target market was 6-10 years-old kids who were beauty-orientated, followed fashion and looked for products with extra benefits. Quantitative research on the concept was carried out in two test markets (USA and Japan). An international company like Naive was supposed to test products in more than one market to assess properly the global appeal. A number of criteria were used to test the concepts: 1) Cosmetics category performance measures.

    These included wetness, dryness, and fragrance. The new concept was supposed to deliver generic core benefits. 2) Product attributes specific to the new product and Disney core values. The new Young Beauty product has additional benefits to a ‘regular’ cosmetics. For example, it leaves the kid’s skin smooth and gives it a natural shiny look. 3) The product needed to be relevant and motivate a consumer to purchase it. The team chose the ‘winning’ concept. This best conveyed beauty while remaining relevant to the cosmetics category and Disney brand.

    Next the research team tested various name ideas for the product and developed different designs for the packaging. Packaging design plays a very important role in helping to communicate the image of the product. Pink and blue colors, suitable for boys and girls was an easy choice for the packaging. Testing the product, brand positioning and advertising Testing The stages described so far produced a product concept that consumers felt was relevant and which they were willing to buy. The next stage was to test the product on actual customers.

    Many product launches fail, despite great advertising. A big reason is because the product fails to live up to the promises made. The Market Research Team conducted a product usage test. A De-branded sample of the proposed new product was given to the target consumers in several countries. De-branded means the cosmetics was in a blank container o that the consumers did not know who made the product or what type it was. Very often consumers form opinions about products and services from advertising and packaging. The consumers were asked to use the new cosmetics for their kids for a week.

    They kept a diary of when they used it and scored the performance of the cosmetics against a list of criteria. These included: Did you have to reapply it? Did you like the fragrance? Did it last all day? Was the product reliable and safe on the skin of your child? The results of the test were very positive. Most the parents and kids loved the fragrance and the eel of the product on their skin. Most said they would swap their brands after trying the product. Brand positioning Now the marketing team had a new product idea that consumers liked. It had a name and packaging design that were well received.

    They now needed to check how this fitted with the rest of the Disney cosmetics brand positioning and range. Evaluating success Once the product is launched and the consumer can actually purchase it, the research process does not stop. Continuous consumer tracking can be carried out to find out consumers’ views of the new product. This involves interviewing people every day to find out whether they are using the product, what they think of it and why they would purchase it. Conclusion New product development should start with an insight based on consumer needs.

    Throughout the NYPD process, market research is a valuable tool for Disney Company to check viability and minimize the risk of the product launches. Being an international company, it is essential that Disney develops new products using the insights of consumers across markets and cultures. This ensures the products are relevant to a large number of global consumers and will deliver the maximum return when launched. This maximizes return on investment for Disney and results in happy, satisfied and loyal consumers. “Get a good idea and stay with it.

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