Key Strategies of Disney

Disney

Introduction

Recognized as a pioneering animation company in America, The Walt Disney Corporation colloquially known as Disney is a North American international corporation that deals with the production of animated films and movies. The company was founded in the year 1923 approximately 99 years ago. It has its apex office mounted on the coast of Burbank, California. Prior to the change of the company’s name in the year 1986, the company had adopted several cognomens including, Walt Disney Productions as well as Disney Brothers Studios. Disney is recognized as a pioneer of animation movies and had since its inception remain the leading company in the animation industry. The company witnessed its major successes during the 1940s and diversified extensively into other related market niches in the industry as animation; these include diversifying into live-action films, the creation of amusement parks, telecasts as well as other related business segments. The company had received tons of awards and recognition for its excellence and brilliant operations. These awards include but are not limited to a total sum of 135 Academic Awards ( accumulated since inception with the inclusion of twenty-six awarded to Walt). Additionally, in the year 2022, the company was named on the Fortune 500 2022 list ranking in the 53rd position and 183 in the Fortune Global 500, a feat indicating the corporation is one of the largest corporations based on revenues in America as well as the world at large. According to Fortune Magazine, as of January 2022, Disney recorded a total sum of 129 Million subscribers. The company also ranked in the 5th position on Fortune’s World’s Most Admired Companies in 2022. However, some business experts and analysts have traced the cause of Disney’s astounding successes to its choice and use of some certain strategies. The strategies are recognized as key drivers responsible for the company’s growth. However, before delving into the discussion these key strategies which form the basic portion of this piece, a quick glance into the company’s transition would be looked into in the following section. 

Disney’s Transition At A Glance 

Prior to the establishment of the company in the year 1923, Walt Disney and his friend UB Iwerks who is skilled in animation production conjoined to establish a firm, operating under the name, Laugh-O-Gram Studio. During the lifetime of the company which was recognized to be relatively short, the company produced a short movie titled, Alice’s Wonderland, a movie which are widely popular today. However, after the production of the movie, the record has it that Laugh-O-Gram witnessed bankruptcy and the company was shut down. The film later went viral when Margaret J. Winkler, a popular film distributor based in New York bought it. The contract made Walt dive into making the movie a series. Afterward, he migrated to Hollywood where his brother known as Rosy O. Disney resides, and together, on the 16th of October 1923, the two brothers conjoined to found Disney Brothers Studios which was used as a studio to release the series of Walt. 

In the year 1926, after the completion of the studio, the company’s name, Disney Brothers Studio was rebranded to Walt Disney Studio. 

In the year 1929, Disney partnered with Columbia Pictures signed to be the company’s sole distributor of its new series with the tag name, Silly Symphony. 

In the year 1930, on January 13th, the company released the comic movie one of its animated characters that had made a name for the company, including becoming one of its signage, Mickey Mouse. The strip debuted in the New York Mirror and thereafter was already published by more than 60 tabloids in the United States as of 1931.   

In the year 1934, Walt made a pronouncement that he realize more revenue from merchandising the character Mickey Mouse to other creators than the movie itself. 

Dating between 1932 and 1937, after Colombia Pictures stepped out of its contract with Disney, the company signed on with United Artists to continue the distribution of Silly Symphony.    

In the year 1932, the company partnered with Technicolor, and by 1935 they had already released several animated movies starting with the production of Flower and Trees which happened to be the industry’s full-animated film to win the Academy Awards for Best Cartoon movie following its release. 

Stepping into today’s dispensation, in the year 2012, The Walt Disney Company bought UTV Software Communications, an acquisition that led to the company’s expansion into India, and other parts of Asian countries. 

In the year 2019, The Walt Disney Company bought part of the 21st Century Fox company’s stock. The value of the stock was in the amount of $71.3 Billion USD, and it was recorded to be the largest purchase in the history of the company. 

Key Strategies of Disney 

This section would introduce and address the key strategies utilized by The Walt Disney Company. These strategies as pointed out in the introductory portion of this piece are responsible for the company’s increasing successes. These strategies include: 

Quality Exploration through Investment: 

According to Forbes Magazine, over the past three years, The Walt Disney Company has successfully produced over 11 Billion Dollars in film projects which are technically times two of every other studio put together. The company recognized the values and return embedded in making rational investments and this has always been one of the company’s competitive advantages over its counterparts. The positive effect of this strategy on the company was apparent especially in January 2022, when Fortune Magazine reveals that Disney recorded a total sum of 129 Million subscribers which is far beyond the reach of other companies.

Leveraging Brand Differentiation:   

Another key strategy the company leverages is its brand differentiation. Typically, audiences gravitate towards any movie spotted online with the company’s logo in that they are certain what they would get from the movie would definitely be a top-notch ranging from its picture quality, to contents, to its sound, no other competitor has been able to successfully beat the company on this. This strategy has been able to successfully create customers’ trust in the company as well as cementing and sustaining long-lasting relationships with every client of Disney.    

Ability to Monetize and Diversify: 

The Walt Disney Company is basically known for one thing by business analysts and experts; when it produces hit content, the content often has the potential of attracting value across several business niches, as a result, raising the company’s return potential. Additionally, with the creation of its theme park which forms another monetary stream for the company, The Walt Disney Company is able to generate substantial revenues to ensure the smooth running of the business.    

Leveraging Unequal Franchises: 

With a broad spectrum of efficient and excellent franchises including but not limited to, 20th Century Studios franchises, Disney Interactive franchises, Disney consumer Products franchises, Disney Media Networks franchises, Lucasfilm franchises, LucasArts franchises, Touchstone Pictures franchises, amongst others, The Walt Disney Company has been able to penetrate the industry successfully, dominating every of its market segment with astounding market capitalization.   

Merger & Acquisition: 

Merging, partnering, and acquiring companies and valuable assets are part of the contributing factors that had helped the company to its current pedestal. For example, the record has it that in the year,1932 the company partnered with Technicolor, and by 1935 they had already released several animated movies starting with the production of Flower and Trees which happened to be the industry’s full-animated film to win the Academy Awards for the Best Cartoon movie following its release. Additionally, in the year 2019, The Walt Disney Company bought part of the 21st Century Fox company’s stock. The value of the stock was in the amount of $71.3 Billion USD, and it was recorded to be the largest purchase in the history of the company. 

Long-run Philosophy on Profit Maximization: 

The Walt Disney Company like the likes of companies like Berkshire Hathaway and JPMorgan believes in the long-run effect of an investment or acquisition over its shut-run effect. For example, the company tends to gain more from the acquisition of the 21st Century Fox company’s stock. Albeit the stock’s value is relatively high, not to mention the other related expenses the company would incur in the future time, nonetheless, the company would ultimately gain a positive return from the acquisition in the long run which has always been a trend for the company according to its past records.

Conclusion 

The foregoing sections have critically reviewed major aspects of the animation pioneering and leading company, The Walt Disney Company. Beginning with a brief overview, running through the company’s transitions, and to reviewing and addressing the company’s key strategies including, 

Leveraging Brand Differentiation, Quality Exploration through Investment, Ability to Monetize and Diversify, Merger & Acquisition, Leveraging Unequal Franchises, as well as Long-run Philosophy on Profit Maximization. That being said, I hope you are able to understand how important and crucial these key strategies are to The Walt Disney Company throughout this article, and that the success of every company is tied to how efficient they are able to utilize and leverage their strategies.   

26/10/’22