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GBA 517: Essentials of Marketing Management
Professor Moncrief, Ph.d.
November 29, 2011
by: Roy Frausto
Thomas Retchless
Michael Tschebaum
Jonathan Wong
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Table of Contents
INTRODUCTION ................................................................................................................................. 3
Disney Era ........................................................................................................................................................... 3
Eisner Era............................................................................................................................................................ 4
Eiger Era ............................................................................................................................................................. 5
MARKETING MANAGEMENT ISSUES ...................................................................................... 7
Issue 1: Promotion............................................................................................................................................. 7
Issue 2: Place....................................................................................................................................................... 8
Issue 3: Product ................................................................................................................................................. 8
GOALS AND OBJECTIVES ............................................................................................................ 10
CONSTRAINTS ................................................................................................................................... 12
SWOT ANALYSIS .............................................................................................................................. 16
Finding 1: Disney’s Strengths...................................................................................................................... 16
Finding 2: Disney’s Weaknesses (Promotion) ................................................................................... 16
SOLUTIONS ......................................................................................................................................... 18
Solution 1(Campaign and Placement) for Finding 2 (Promotion) ............................................. 18
Solution 2 (Public Relations) to Finding 2 (Promotion) ................................................................ 20
Solution 3 (Packaging) to Finding 2 (Promotion) ............................................................................ 21
IMPLEMENTATION PLAN ............................................................................................................ 24
Return on Investment .................................................................................................................................... 24
Implementation Outline ................................................................................................................................ 28
CONCLUSION..................................................................................................................................... 30
REFERENCES ..................................................................................................................................... 31
APPENDIX A: SOURCES OF IMAGES....................................................................................... 33
APPENDIX B: SOURCES OF DATA ............................................................................................ 34
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INTRODUCTION
Disney Era
Walter Elias and Roy Disney founded the Disney Cartoon Brother’s Studio on October
16, 1923 and later that year it was renamed The Walt Disney Company. In 1923, Disney
debuted Mickey Mouse, in Steamboat Willie. This was the first film to utilize synchronized
sound. It did not take the Disney Brother’s long to achieve great success by winning an
Academy Award for Best Cartoon in 1932, for Flowers and Trees, a Silly Symphony. Success
continued for the Disney Brother’s when they introduced several full-length animated films
starting with Snow White, in 1937. Snow White became the highest grossing film at that time
and was followed by Pinocchio and Fantasia, in 1940, Dumbo, in 1941, and Bambi, in 1942
(Bell, 2). All films were major successes for the Disney Brother’s.
The most profound accomplishment of Disney was revolutionizing the way movies were
viewed. At that time, movies were shown as 8-minute shorts, while Disney created feature
length films. Audiences were amazed with the beautiful imagery and emotional storytelling seen
through the eyes of Disney characters. The Disney Brother’s were true pioneers in their industry
continuing to push the boundaries of animation. After WWII, they incorporated animation into
live action production films, such as in their 1946 release the Song of the South (Bell, 2).
The Disney Brother’s produced their first television program in 1954, called The
Wonderful World of Disney. “It ran on all three major networks, went through 6 major name
changes, and ran for 26 years becoming the longest running primetime television show in
history” (Bell, 2). The Mickey Mouse Club debuted on ABC in 1955 and ran through 1959,
captivating young viewers and making stars of many of its actors. The main cast members were
called Mouseketeers, the most popular of which were the “Red Team,” starring Annette
Funicello, Tommy Cole, Darlene Gillespie, Cheryl Holdridge, and many others. Disney Studios
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resurrected The Mickey Mouse Club in the early 1990’s, renaming it The All New Mickey Mouse
Club, and aired it on the Disney Channel. Again Disney was successful in launching the careers
of many of its actors, including Brittney Spears, Justin Timberlake and Christina Aguilera.
In order to bring to life their most ambitious project yet, the Disney Brothers had to see
beyond the restrictive black and white colors of television. While Walt Disney was a filmmaker
by trade, he sought out avenues to expand beyond television and film by creating Disneyland.
Disney was now able to attract millions of people worldwide to visit their theme park and
explore rides and characters based on television and movies. When Walt Disney died in 1966,
his brother Roy built Walt Disney World in his honor.
Long before his death in 1966, Walt had an envisioned another theme park to follow up
his success with Disneyland. When Roy Disney died in 1971, all day-to-day operations of the
company were taken over by management. More theme parks would follow, including one in
Marne-la-Vallee, France and in Urayasu Chiba, Japan. Annually, the theme parks and resorts
attract over 120 million people worldwide.
Eisner Era
Starting in 1984, Michael Eisner took over as CEO of The Walt Disney Company. He
took Disney, “a company with a fading brand and lackluster management, (a non player in the
media and entertainment business) and turned it into the most powerful force in the industry”
(Wolff, 1). Eisner was a genius at creating a branding model to license Disney assets unlike any
company prior. Eisner utilized the Disney entertainment assets by syndicating its library of films
for TV and restoring and releasing classic animated films including, Snow White, Fantasia,
Pinocchio, and Dumbo, to name a few. Michael Eisner created billions in newfound revenue
streams for Disney during his tenure. Disney acquired ABC for $19 billion, which at that time
was the second largest single transaction in the history of the United States. They gained control
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of a large TV and Cable Network, newspapers, and radio stations. Success continued because of
this merger, with worldwide box office sales peaking at $3 billion (Bell, 3).
Michael Eisner tarnished his remarkable turnaround of Disney when Jeffrey Katzenberg,
former head of motion picture development and feature animation filed a lawsuit against
Disney. Katzenberg alleged he should have been promoted to President of Disney, after
President Frank Well’s died in a helicopter crash. When Katzenberg pressured Eisner, he would
not budge and instead forced Katzenberg to resign from Disney all together. Dissention emerged
among top-level staff with many resigning or forced out. Eisner’s Achilles heel was his ego. He
felt he was untouchable at the helm of Disney, but ultimately it was the legal savvy of Disney’s
two largest stockholders, Warren Buffet and Sid Bass, who would end his run at Disney in 2005.
Eiger Era
2005 saw a new era of Disney with Robert Eiger, who replaced Eisner as Chief
Executive Officer. In 2006, Disney was comprised of four major business units. The first
unit was Disney Media Properties, which managed all media channels, including radio and TV
stations, and internet holdings. The second unit was Walt Disney Parks, which
managed 10 theme parks in North America, Europe, and Asia, as well as 2 cruise ships, and 35
vacation resorts. The third unit was Studio Entertainment, which is comprised of animated and
live action films. The fourth unit was comprised of Disney Consumer Products, which included
Disney characters, visual and literary properties sold to manufacturers and retailers, published
books, magazines, and computer software products for the home and educational markets (Bell,
3).
2006 was a stellar year for Disney because it had minimized the negative press related to
the Michael Eisner trial. In 2006, Walt Disney Company was worth an estimated $43.2 billion
and had annual revenues of more than $2.5 billion. Disney also held the most valuable franchise
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character, Mickey Mouse, with an estimated value of $5.8 billion. The most impressive record
of all is that Disney consumers spent an average of over 9.16 billion hours immersed in the
Disney entertainment experience, either through visiting a theme park, resort, cruise ship, or
through watching film and TV products (Bell, 3).
Disney continues to diversify its brand holdings by branching off into consumer food
products targeted at children between the ages of 2-11. They have embarked on an ambitious
project to reclassify their food products in the consumers’ mind from treats and sweets to
healthy choice snacks for children. Disney utilizes its famous characters, including Mickey
Mouse, Snow White and others to help sell their products by associating the Disney experience
with food. Disney is a new player in this market and needs to reorganize and market their
products in a way that help them gain the most market share in a market that already includes
established players like Nickelodeon, Warner Brothers, and Sesame Street foods.
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MARKETING MANAGEMENT ISSUES
Disney’s new strategy to penetrate the market of healthy consumer foods came about for
several reasons. One primary reason includes the threat of brand recognition from fun and magic
to the association of “growing criticism from activists, parents, and governments around the
world who believed [Disney] contributed to the growing obesity epidemic” (Bell, 2009 P. 1).
Although executives at the Disney Consumer Products adjudicated to market new healthy
products, they were faced with multiple strategic management issues in promotion, pricing,
place, and product. Of the strategic issues, promotion, place, and product each contain one
critical concern that cannot be disregarded.
Disney’s food and grocery revenues in 2003 to 2005 were stagnant as shown in Table 1.
With Disney’s first release of their healthy consumer product line in 2006, Disney Consumer
Products (DCP) hoped to boost their sales revenue. Their healthy food categories included:
water, juice, milk, fruit, and vegetables as shown in Image 1. A release by Forbes listed the topearning fictional characters from 2003 to 2004 showed that the top two characters were created
by Disney as shown in Table 2. Not only did Disney dominate the list of fictional characters, but
also lead the industry by licensors of entertainment brands in 2005 as shown in Table 3.
Although Disney dominates the charts and statistics as number one, Disney still struggles with
three key advertising issues.
Issue 1: Promotion
Disney’s first and foremost success criterion involves the promotion or advertising of
their products. Unfortunately, the most crucial success criteria are not being implemented
properly. The public knowledge of Disney’s line of healthy products is minimal to near existent.
Disney has increased their advertising over the years from the first release of their healthy line.
Disney allocates minimal amount of advertising toward healthy products. Disney spent five
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hundred and seventy million dollars in 2009 and six hundred and eighty seven million on
selling, general, administrative, and other services in 2010 (PWC 2010, 10-K). Of that, only a
small portion was geared toward advertising. Disney’s current strategy in consumer products is
licensing and publishing with the highest category of revenue earned at approximately two
billion dollars in 2010 (PWC, 2010, 10-K).
Issue 2: Place
The strategy of Disney producing high amounts of revenue is contributed to licensing,
publishing, and retail. Many of their consumer products are being sold internally, such as in
theme parks, hotels, and cruises. With such a high focus on internal distribution, Disney
struggles to capitalize and perfect the marketing concept of place. The place that Disney vaguely
recognizes is the idea of building a stronger external distribution relationship. One of Disney’s
distribution methods is direct to retail (DTR), selling where the brand and character rights are
sold directly to the retailers, which bypasses wholesale licensees. The “retails would then source
the manufacturing themselves and manage sales and marketing” (Bell, 2009. P.4-5). Another
Disney distribution model is called sourcing. The sourcing model consists of contracting to
manufacturers “where products were created and designed by Disney and featured the Disney
brand, but the licensee would handle the manufacturing, sales and marketing” (Bell, 2009, P. 4).
With such distribution models, Disney has little control over how the sales and marketing
aspects are managed. Even though a relationship has been established among top retailers such
as “Target, Wal-Mart and other large retailers (Bell, 2009, P.5), it does not necessarily dictate a
strong relationship resulting in increased revenue.
Issue 3: Product
Disney’s idea to enter the market of health foods comes at a huge risk. The products
being produced and distributed faced by consumers may not be attractive. Many consumers
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already have products or brands that they favor. The relationships that these consumers have
with others may be detrimental to Disney’s business if they cannot convince consumers to
change. It is extremely difficult to change a consumer’s perspective if they have a relationship
with another brand or manufacturer for years with no issues. Even if Disney poses attractive and
new health conscience products, they will face a number of other competitors looking to
establish a market share.
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GOALS AND OBJECTIVES
Over the years, The Walt Disney Company has consistently been the magical symbol for
entertainment for children across the world. From the scorching thrill rides, to the delicious
character popsicles, Disney has defined what it means to experience “magic.” As stated in their
company website, “The Walt Disney Company's objective is to be one of the world's leading
producers and providers of entertainment and information, using its portfolio of brands to
differentiate its content, services and consumer products. The company's primary financial goals
are to maximize earnings and cash flow, and to allocate capital toward growth initiatives that
will drive long-term shareholder value (Investor Relations, 2011).” In addition, "The mission of
The Walt Disney Company is to be one of the world's leading producers and providers of
entertainment and information. Using our portfolio of brands to differentiate our content,
services and consumer products, we seek to develop the most creative, innovative and profitable
entertainment experiences and related products in the world (Corporate Relations, 2011)." In a
world of constant change, the topic of the decade has been shining on the “Green Industry.” Not
only does this encompass the environmental concerns for the environment, but it also extends to
the healthy life styles that people should abide to. With that being said, Disney has learned to
adapt with new standards and goals to revolutionize itself as a healthy green company.
In the beginning of 2004, Disney began to analyze the statistical data of obese children.
Realizing the staggering numbers across the world and the fact that most of their foods were
associated with treats, the company began to consider the nutritional value of the food products
they offered. In a short amount of time, Disney conducted a corporate-level audit of their food
and beverage offerings within all of its divisions for the purpose of introducing a range of
healthy new products. From this time forward, Disney had set a goal to improve the nutritional
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value of its licensed food products by June of 2006 and embark on a mission to improve all of
its licensed food products by 2008.
Acknowledging that parents (especially mothers) wanted healthier choices for their
children, Disney set about objectives to propose products that were adequately portioned, high
in quality, taste good, and omit or reduce fat and sugars. Managers then determined that the key
product categories to introduce/improve were in water, fresh food, frozen food, fresh food,
juice, pasta, soup, cereal, baked goods and dairy/milk. From this point, DCP began
reformulating and demanded their vendors to adapt to healthier products to meet their nutritional
goals. In addition, DCP executives were aware that the products needed to be appealing to
children, so the company integrated Disney characters to make these products “fun.” Signing a
contract with Kroger to offer their products, Disney plans to offer more than 200 Stock Keeping
Units (SKU) by summer 2007 and establish sourcing relationships with Safeway and
Albertson’s supermarket chains to build market share.
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CONSTRAINTS
Implementing nutritional changes in markets, Disney will also make nutritionallybeneficial changes to meals served to children at all Disney operated restaurants in parks and
resorts. Disney’s set goals are to eliminate added trans fat from food served at its parks by the
end of 2007 and from all its licensed and promotional products by the end of 2008. With these
dramatically positive changes they will lose money in the beginning, but with the wide
distribution and the Disney brand itself, managers believe that their objective will win over
moms from other competitors and begin to show positive net revenues. The constraints that
Disney faces includes ones they place on themselves and ones that the industry faces as outlined
in Table 1.
Table 1: Table shows the constraints placed on Disney and the food industry.
Disney
Constraints
Industry
Wide
Constraints
Disney’s
contract with
Kroger limits
underselling to
other stores.
Disney’s
contract With
Imagination
Farms Limits
other vendors
using
characters.
Disney’s lack
of weekly
cartoons
prohibits week
relationship
with children.
Disney’s self
imposed
limit on
treats to
15%.
Disney’s
guidelines for
higher
nutritional
standards.
FDA
regulations
limiting food
that can be
sold.
Character
Driven
products
require higher
prices.
Products
limited to a
particular
audience.
Limited
producers
for healthy
products.
Public
opinion limits
companies’
options to
avoid bad
publicity.
Disney
Disney’s contract with Kroger is a constraint by not allowing them to undersell Kroger
to other grocery stores. They gave Kroger a discounted price to sell their products and by doing
so, Disney limited itself to offer any additional discounts to other grocery stores. Disney added
another constraint when they signed a contract with Imagination Farms. By only allowing
Imagination Farms to provide healthy Disney products they are constraining themselves from
allowing other vendors to use their characters on similar products. Disney is also constrained by
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their lack of weekly aired cartoons. The lack of cartoons limits their character’s appeal to young
children. Limiting regular viewing of characters prohibits children from developing a weekly
relationship with characters.
When Disney decided to change directions and establish a healthy food line, they
decided to put constraints on the types of food they allow. Disney established future goals
limiting treats and snacks to 15% of their food offered to consumers. This helped them move
away from their profitable treats of the past. The new direction called for 85% of food offered to
be in the form of main meals. Disney added further constraints when they established nutritional
guidelines that new products must to meet. They set limits on calories, fat, added sugar and
sodium. The guidelines are much higher than that of Food and Drug Administration (FDA).
These guidelines are hard to meet but provide healthier foods for consumers.
Industry
The food industries major constraints are the regulation placed on them by the FDA for
acceptable foods. The FDA limits products sold in the United States, limiting what vendors can
produce. The limitations vastly affect the products that are produced and offered in the United
States. Pricing constraints limit the amount character products can be sold for. The cost is higher
than low end products because of the extra costs associated with using characters on products.
This limits how low vendors can sell character products for.
A particular audience is targeted with character food products limiting the mass appeal
their products can have. Once children out grow character products, purchasing them becomes
unlikely. Due to the extra cost associated with character food products, most consumers will not
pay the extra cost for character products once they stop appealing to children. There are a
limited number of health food producers available to Disney and competitors for character
products. Additionally, public opinion is a constraint on companies due to bad press. If the
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public opinion of a company goes down, their products may have a difficult time selling. This
limits companies’ options if they feel bad press may be an outcome.
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SWOT TABLE
Strengths
Weakness’
Opportunities
Threats
Disney
Nickelodeon
Sesame Street
Warner Brothers
- Providing experiences for every age
group
- Park visits give extra exposure to
character
- Lots of capital for marketing
- Experience food through Parks and
hospitality experiences
- worlds most admired companies
(Number 14)
- superior creative process (product)
- different methods of influencing
target group/ audience (children)
- Established presence in healthy
foods market
- Popular cartoon characters
- Seen by 89 million households
- Cartoons aimed at relevant age
group
- cartoons aired weekly that influence
target audience
- increased familiarity products such
as tickle me elmo (big hit)
- promotion through cartoons
(Elmo/Big Bird/Cookie Monster)
- distribution channels (amazon, toys r
us, walmart, target, etc)
- recognizable brand name from
childhood
- stronger relationship with young
children through schools
- specialized in advertising
(promotion)
- character placement in theme parks
(Six Flags)
- promotion through cartoons on
public tv (no cable necessary)
- targeted toward all age groups
- well connected to famous stars for
promotional purposes
- Lack of promotion for healthy
product lines
- Lack of strategic placement in stores
- Moving into established markets
- Undifferentiated products
- Lack of experience in healthy foods
- Competitive vulnerability
- Not managing sales
channels effectively
- Lacking positive public relations
- Moderate to high pricing
- Poor brand recognitions
- Lack of promotion for healthy
product lines
- Lack of strategic placement in stores
- Moving into established markets
- Undifferentiated products
- Lack of experience in healthy foods
- Competitive vulnerability
- Moderate to high pricing
- Limited age group appeal
- Targeting wrong audience
- Small market share
- Moderate to high pricing
- Limited products
- Targeting wrong age group
- Lack of food product experience
- Small market share
- Moderate to high pricing
- Limited products
- create effective promotional
strategies to draw in new customers
- strategically placing products
effectively
- establish a market position
- differentiate products
- gain experience for the market
-expand R&D to capture larger share
of market to reduce vulnerability
- utilize effective sales channels
- gain positive public relations
-find different vendors for better price
points
- create positive image for healthy
food brands
- change perception of the characters
to positive
- capture the market of the female
audience
- expand R&D to capture larger share
of market to reduce vulnerability
- gaining recognition for health
products
- find different vendors for better price
points
- utilize celebrity appeal toward all
audiences
- target the appropriate age groups
- capture more market share
- find different vendors for better price
points
- create new innovative products
- target appropriate age group
- gain product experience
- expand market share
- find different vendors for better price
points
- expand product line
- lack of healthy vendors
- economic crisis
-agricultural problems
-healthy foods are not as nutritious as
perceived
- surgeon general says a healthy food
product is not healthy
- lack of healthy vendors
- economic crisis
-agricultural problems
-healthy foods are not as nutritious as
perceived
- surgeon general says a healthy food
product is not healthy
- lack of healthy vendors
- economic crisis
-agricultural problems
-healthy foods are not as nutritious as
perceived
- surgeon general says a healthy food
product is not healthy
- lack of healthy vendors
- economic crisis
-agricultural problems
-healthy foods are not as nutritious as
perceived
- surgeon general says a healthy food
product is not healthy
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SWOT ANALYSIS
In order to access and analyze Disney’s case versus other competitors, categories such as
strengths, weaknesses, opportunities, and threats need to be compared. As shown in the SWOT
table analysis, Disney was compared to Nickelodeon, Sesame Street, and Warner Brothers. The
competitors were chosen mainly because of similar interests in the market share of consumer
products, mainly foods. With such similar companies, each company has its own strategies on
marketing, advertising, and distribution. Although Disney possess’ many strengths, it also has to
overcome several weaknesses.
Finding 1: Disney’s Strengths
Disney’s strengths are unique in that all the other companies do not possess them. For
example, Disney’s reputation in giving out quality experience in theme parks and hospitality
services is world-renowned. Not only does Disney provide unforgettable experiences for all
ages, but was also ranked nineteen as one of the worlds most admired companies in 2010
(Money CNN). Nickelodeon, Sesame Street, and Warner Brothers all contain strengths that
Disney currently does not hold. For example, Nickelodeon has an established presence in the
healthy foods market, Sesame Street has a large distribution channel through Amazon, Toys R
Us, Wal-Mart, and Target, and Warner Brothers has promotion through cartoons on public TV.
Although Disney has strengths, they also have weaknesses that hinder their performance.
Finding 2: Disney’s Weaknesses (Promotion)
Some major weaknesses that Disney face include their advertising and distribution
strategies. The main key finding is that the healthy Disney products are unknown to most
consumers, such as children and adults. Disney lacks the necessary outreach of their healthy
product lines for successful revenue. The second key finding is that the consumer products of
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health conscience foods and industry distributions are not attractive resulting in crippled profits.
The third key finding is distributional relationship. Disney’s distribution relationship needs to be
perfected in a way that would maximize management and advertisement for their products. The
weaknesses faced by Nickelodeon, Sesame Street, and Warner Brothers vary by company.
Nickelodeon faces challenges with undifferentiated products and competitive vulnerability.
Sesame Street weaknesses include a limited age group appeal and small market share. Warner
Brothers lack the food product experience and contain a small market share. With the
weaknesses identified by Disney, they could implement profitable opportunities.
Disney, Nickelodeon, Sesame Street, and Warner Brothers contain weaknesses that
could be solved with new opportunities. Disney can create an effective promotional strategy that
could solve the lack of advertisement they face. With the lack of strategic placement in stores,
Disney could come up with new innovative ideas with retailers on how to display their products
to entice consumers. The weak relationship with distributors and retailers could be strengthened
to help Disney move their products in a quick manner. Nickelodeon’s lack of undifferentiated
products could allow them the opportunity to expand their R&D to produce new products and
approaches to competitive vulnerability. Sesame Street has the opportunity to create innovative
products and target a more appropriate age group to expand their market share. Warner Brothers
lack of food experience would ultimately lead them to gain product experience. All four
companies face opportunities from weaknesses but they also face threats from the industry and
each other.
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SOLUTIONS
Solution 1(Campaign and Placement) for Finding 2 (Promotion)
A marketing campaign strategy focusing on television (TV) and in store advertisements
(ads) will address Disney’s weak promotional issues and take advantage of opportunities
competitors have not. This will also introduce Disney’s healthy food line to the mass public.
Disney has the opportunity to be the first character-driven healthy foods producers to market
their products. As the SWOT indicates, Disney lacks promotion for their healthy foods.
Competitors have weekly cartoon promotions of their characters. Disney lacks a weekly
consumer influence. Disney must adapt; through TV and in store ads they can influence
consumers in new ways.
First, Disney must reinvent themselves in consumers’ minds as a healthy food.
Consumers view Disney’s food as unhealthy. Informing consumers about their healthy food line
can change negative associations. This can be achieved by maximizing awareness of Disney
products through TV ads. DCP managers will need to study and manage commercials to ensure
the message comes across that Disney’s healthy foods have high quality standards.
The message should be directed at middle to upper class parents whose children are
between the ages of 3 and 13. A well-established Disney character familiar to consumers should
present the message. Later advertisements can be targeted at children, but first Disney must
establish their healthy foods in the minds of parents. Slogans like “Disney’s healthy foods make
children grow up healthy and strong” or “if your children’s health is a concern you should try
Disney’s nutritional foods.”
Latter commercial should be targeted at children from the ages of 3 to 13. Commercials
can feature a spokes model character condoning an over weight evil character for his poor eating
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habits. The spokes model can change the evil character’s ways by introducing him to Disney’s
healthy foods. This will both entertain and educate audiences on Disney’s new healthy food
line.
The second step is marketing Disney’s healthy foods within stores. Once consumers
know about Disney’s healthy foods they will need to find it. Having asked more than 30 people
about Disney’s food products in super markets, it is clear that Disney consumer product
managers have failed to place their products in the market to make them easily accessible to
their consumers, since all 30 people had no idea they existed. The lack of strategic placement of
these products will continuously affect net sales and gross margins unless DCP mangers
implement a solution. To remediate such a problem, DCP managers will need to invest a great
amount of time in marketing techniques to gradually captivate consumer’s attention down the
market aisle.
Product placement is undisputedly an important factor when introducing or offering new
products. Disney needs to grab consumers’ attention inside grocery isles. Ads placed in grocery
store isles showing Disney’s foods locations can achieve this goal. There should be cardboard
cutouts of the spokes model character allowing consumers to identify Disney products. Vendors
can also show Disney products on end caps and other high traffic areas.
To maximize product placement awareness, Disney should also offer samples of their
products with a trained Disney employee to emphasize key products and nutritional facts. Not
only would this give a child and parents a taste of the products, but also capture the parent’s
perception of these products. Additionally, Disney could place a monitor that has a Disney
character briefly highlighting nutritional facts of their products in their assigned aisle section.
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Using these strategies would engrain a memory into children and parents to remember
where products are located and what they can find in these aisle sections. After DCP managers
determine that products have sufficient bearing to captivate consumers to look for their
products, Disney can collaborate with sorting their products in accordance to their respective
aisle in the store.
Marketing through T.V and in store ads will allow Disney to take advantage of their
competitors’ weakness while addressing one of their own. It establishes their new direction and
engrains their food line in the memories of consumers. This strategy ensures recognition for
Disney’s healthy foods.
Solution 2 (Public Relations) to Finding 2 (Promotion)
A positive public relations (PR) campaign can gain Disney recognition for their healthy
foods. Disney does not lack brand reputation against any competitor, yet they lack weekly
cartoon character promotion of their food products. Whereas, Nickelodeon’s current cartoons
are seen in 89 million households, Disney lacks relevant cartoons to market their products.
Although, Disney consumers spend approximately 9.16 billion hours immersed in the Disney
experience, those hours do not fully utilize marketing efforts for their food product line. Disney
needs to draw attention to their new healthy food line.
Disney’s PR can draw consumers’ attention to their healthy foods. Since most people are
unaware of Disney’s new direction, a message must be expressed to the public about their new
direction. A positive PR campaign will establish Disney’s place in the market. Nickelodeon,
first in the market has a dominant position in healthy foods. A positive PR campaign can steal a
share of Nickelodeon’s market and etch out a place for Disney.
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A PR message should not condemn the ways of the past, but allow consumers to
understand Disney’s concern for children’s health. Disney’s motive is to reduce childhood
obesity; this needs to be known by the public. It is commendable that Disney is putting
children’s health as a priority while risking millions due to their concern for childhood obesity.
This needs to be publicized to consumers.
Disney must find a way to combat their limited promotion. A PR campaign can establish
Disney’s place in the market and introduce their food line. Focusing on Disney’s concern for
children will get the message out and allow people to sympathize with their cause.
Solution 3 (Packaging) to Finding 2 (Promotion)
Distinctly designed packaging will help draw attention to Disney’s healthy food
movement and will make an impact in consumers’ minds. The packaging should contain
nutrition standards and can incorporate green movement ads in designs. Disney Consumer
Foods face a challenge in changing people’s perception about their children’s food line. Disney
once known for producing only sweets and treats must now shed that image to increase
awareness of their organic health conscious food line. In this market, consumers already have
favorite products from manufacturers such as Nickelodeon, Sesame Workshop, and Warner
Brothers. The challenge for Disney Consumer Products is to create positive consumer
perception about the benefits of their food product line over their competitors.
Disney needs to draw on the experience of their marketing and advertising teams to
create campaigns that will generate consumer awareness of their redesigned product line.
Disney must combat their weaknesses to overcome the strengths of their competitors:
Nickelodeon, Sesame Workshop, and Warner Brothers. Disney faces the most competition from
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Nickelodeon since they control the largest market share and since they were also the first to
enter the consumer foods market for children.
The first challenge for Disney is to overcome how it promotes and advertises its food
product line. Disney must establish clear distinctions why their food line is superior to their
competitors. They must also establish themselves as the leader in developing a food line that
meets or exceeds FDA guidelines to help reduce childhood obesity and diabetes. Disney can be
the first of these companies to start a movement for healthy children’s foods and in turn capture
a segment of the market where parents and children practice a healthy lifestyle. Consumers
today have choices and are concerned about what is put in their food and how it is grown.
Disney can garner great success by having their food line associated with the green movement
and superior product.
Disney can combat their competitor’s products by creating visual memories in the
consumer’s mind. This can be accomplished by using packaging made from recycled materials,
supporting “green” causes through donations from profits on the food products, and also
advertise on packaging explaining the benefits to eating their foods. For example, they could
explain that they use natural ingredients, no trans fats, no pesticides and herbicides, or artificial
colors or preservatives. Food products today more than ever have to be clearly distinguishable
and top food brands in all categories are utilizing brand messaging to set themselves apart.
Disney can utilize the same marketing strategies to set themselves apart in the children’s food
sector. Although, lacking experience in healthy food products, Disney can leverage its
relationships with food producers and distributors to create the best children’s product on the
market.
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Disney is the largest entertainment company in the world, but somehow has had trouble
with market penetration in the children’s food sector. The Disney name is also by far the most
established and well respected among its competitors. In order to be successful in this stage of
becoming the dominant player in this sector, Disney must demonstrate to consumers their
products are superior in every way from, ingredients, quality, and manufacturing. Disney
controls their future success or failure in this market and must establish brand loyalty through
superior products. Parents can be targeted through store weekly’s, Sunday Paper advertisements,
and kids targeted through new and innovative cartoons and television shows. The benefit of
creating a product line synonymous with the “green” movement will not only benefit the Disney
food product line but also the entire brand.
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IMPLEMENTATION PLAN
With three solutions to help address the promotional issues that Disney faces, the
concept of campaign should be implemented. By initiating an advertising campaign, the word of
Disney’s new healthy product line will be known across the world. This campaign will not only
produce a high return on investment, but also capture a stable market share. To properly create a
successful campaign, a task list, network diagram, and Gantt chart will outline all the necessary
timelines, full time equivalents, and resources required. The task list shows all the steps needed
to complete an advertisement along with their predecessor tasks. The network diagram refers to
the start time, finish time, floating days, and the critical path. The critical path is shown in red
where if any of the tasks lies in the critical path, the project will be delayed.
Return on Investment
Analyzing Disney’s Consumer Product revenues, if we compare them to Coca-Cola’s
revenues (after they purchased “Vitamin Water” from Glaceau in 2007), we can see a trajectory
of possible growth in revenues as seen in the graph below where Coca-Cola’s revenues (CocaCola 2008, 10-K) began to increase (with the exception of 2008 [economic recession])
significantly. The purpose of making this comparison is to emphasize how important product
marketing is when introducing a new-healthy product. Using a simple, but self-explanatory
name that provides people with his or her daily vitamins in a bottle of flavored water and
commercializing the product everywhere, captivated the public’s eyes and influenced them to
purchase these healthy drinks. If DCP takes a similar approach to invest in their marketing
department and began to promote their health-conscious products for children in the same
manner Coca-Cola did with Vitamin Water for adults, DCP may have the opportunity to grasp
the market for children’s healthy alternate options and begin seeing some increases in their DCP
revenues.
25
Coca Cola Revenues vs DCP Revenues
14000
12000
In millions
10000
8000
6000
4000
2000
0
2004
2005
2006
2007
2008
2009
Date
Coca Cola
DCP
2010
2011
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Task List
Task ID
A
B
C
D
E
F
G
H
I
J
K
L
M
Task
Prepare business case
Initial Client/Agency Meeting
Agency Brainstorming
Agency presents concept to client
Adjustments made to concept
Ongoing discussion with client
Hiring of film crew
Story boards created
Presentation of story board to client
Approval of story board
Audition and hiring talent
Filming
Editing and Final Cuts
Team Commitment=Effort/Duration
Immediate
Predecessor
****
A
A
B,C
D
D
D
E,F,G
H
I
J
K
K
Efforts
(Weeks)
2
1
6
1
6
2
2
2
1
2
2
4
6
Duration
(Weeks)
2
1
3
1
4
2
1
2
1
1
1
2
3
Team
Commitment
1
1
2
1
1.5
1
2
1
1
2
2
2
2
27
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Implementation Outline
A. Prepare Business Case
Develop short-term to long-term implementation plan on how to address and resolve current
weaknesses in current sector.
B. Initial Client / Agency Meeting
The agency and client meet to address the messaging the TV spot should convey.
C. Agency Creative Brainstorming
First stages of creative concepts: 1-2 weeks. The creative department form concepts for the TV spot.
These concepts aim to achieve the appropriate messaging
as discussed in the client/agency meeting. This part of the process is the responsibility of the
Creative Director and Art Director assigned to the project.
D. Agency Presents Concept to Client
The ad agency may have a formal meeting or tele-conference with the client to discuss the concepts.
The client will provide feedback. In many cases, the client may add additional assets to incorporate
into the spots.
E. Adjustments Made to Concept
Ongoing discussions with client, hiring of film crew, story boards created: 1-2 weeks. The creative
team fleshes out the concepts and hires illustrators to create the storyboards.
F. Ongoing Discussion with Client
Client and creative team meet to discuss what areas need to be expanded upon and further develop
concept.
G. Hiring of Film Crew
The agency will begin the process of interviewing films crews and commercial directors.
H. Story Board Created
Graphic organizer developed to demonstrate and organize illustrations and images in sequence in
order to visualize concept. Serve to give a visual representation as to how the spots will look
(camera angles, story arc, visual assets, etc.).
I. Presentation of Story Boards to Client / Project approval
The agency presents the completed storyboards for the TV spots in detail.
J. Approval of Story Board
If all goes well, the client will approve the spots for filming. Sometimes there will be minor
changes, which would be adjusted in the storyboards. Then, the storyboards would be sent to the
client for approval.
K. Audition and Hiring Talent: 2 weeks
The agency will be seeking acting talent for the spots. Usually, they have casting calls
to have
29
auditions. This may include voice actors for voice-overs.
L. Filming: 4 days
This stage is simply the filming of the TV spots with long hours on set.
M. Editing and final cuts: 6 weeks
Finally, the film crew edits the spots with agency art director providing direction. With the approval
from the ad agency and its client, final cuts are made. The final spots are sent to a media team for
distribution to TV networks.
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CONCLUSION
It is still evident that DCP has a lot to learn and discover. Managers and executives alike
need to acknowledge these internal issues and begin a tentative plan to remediate these promotional
problems. Unfortunately, the public’s knowledge of Disney’s line of healthy products is minimal to
near existent. With the launch of these new “healthy conscious” products, Disney still falls short
without engaging in effective product marketing. A marketing campaign strategy focusing on
television (TV) and in store advertisements (ads) will address Disney’s weak promotional issues and
take advantage of opportunities competitors have not. This will also introduce Disney’s healthy food
line to the mass public. In addition, a positive public relations (PR) campaign can gain Disney
recognition for their healthy foods, and character designed packaging will help draw attention to
Disney’s healthy food movement making an impact in consumers’ minds. By administering these
solutions, Disney will be on a path to set them apart from their competitors and live-up to the
expectations that Walt Disney once had, “I do not like to repeat successes, I like to go on to other
things.”
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REFERENCES
Bell, David and Winig, Laura (2009). Disney Consumer Products: Marketing Nutrition to Children.
Presidents and Fellows of Harvard College, Boston.
Wolf, Michael. (1999). Eisner Un-Moused? New York Magazine. Retrieved November 2, 2011,
from http://nymag.com/nymetro/news/media/columns/medialife/143/
The Walt Disney Company (October 2, 2010). Form 10-K. Retrieved October 5, 2011 from
http://corporate.disney.go.com/media/investors/form_10k_fy2010.pdf
The Coca-Cola Company (December 31, 2008). Form 10-K. Retrieved November 22, 2011 from
http://www.thecoca-colacompany.com/investors/pdfs/form_10K_2008.pdf
World’s Most Admired Companies. (n.d). Retrieved November 22, 2010, from
http://money.cnn.com/magazines/fortune/mostadmired/2011/full_list/
Investor Relations. Retrieved November 2, 2011 from
http://corporate.disney.go.com/investors/index.html
Corporate Relations. Retrieved November 2, 2011 from
http://corporate.disney.go.com/careers/who.html
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APPENDICES
33
APPENDIX A: SOURCES OF IMAGES
Image Data Sources:
https://enterpriseportal.disney.com/gopublish/sitemedia/dcp/Home/Our%20Businesses/us_lob_fhb_f
ood_fact_sheet_060111.pdf
Image 1: Fruits, Cheese, Yogurt, and Milk
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APPENDIX B: SOURCES OF DATA
Data Sources:
Disney Case Study [Bell]
Table 1: DCP Revenue breakdown
Disney Consumer Products
Revenues

Food and Grocery Only
2003
2004
2005
2003
2004
2005
2,344
2,511
2,127
53
53
69
All values in $ millions
Table 2: Top-Earning Fictional Characters from 2003-2004 by Forbes ($ billions)
Character
Company
Year Introduced
2003
2004
Mickey Mouse
Disney
1928
4.7
5.8
Winnie the
Disney
1926
5.9
5.6
Tolkien Enterprises
1954
2.2
2.9
Pooh
Frodo Baggins
Table 3: Leading Licensors of Character-Driven Entertainment Brands, 2005
Company
Key Character
Rank
Sales ($ billions)
Disney
Mickey Mouse/Winnie the Pooh
1
21
Warner Brothers
Harry Potter/Looney Tunes
2
6
Nickelodeon
SpongeBob Square pants
3
5.2
Spiderman
4
5
&Viacom
Marvel
Entertainment