Current Vision, Mission, Objectives and Business Strategy
According to The Walt Disney Company (2016), its mission is to "be one of the world's leading producers and providers of entertainment and information" (p.1). Through an array of different services, products and content, the Walt Disney Company is dedicated and committed to ensuring that the world is enlivened by innovation and creativity (About, 2016). The company is ingenious in its execution of not only providing a promise to consumers to deliver time and time again, but to exceed their expectations. Hill (2010) finds that Disney has stood the test of time because it understands how to leverage its assets. Moreover, there are always multiple projects that the company is seeking to implement at a time. In addition to this, the Disney operation is described as unique, with employees being as diverse and experienced in executing the vision continuously (p.1). Additionally, the Walt Disney Company is frequently noted for defying conventional attitudes about entertainment, and business.
Hill (2010) goes on to state that Walt Disney's rise "was about bucking the odds and ignoring the critics, whether it was show biz insiders telling him no one would ever sit still for a feature-length animated film, or others saying [it] was crazy [to] buy acres and acres of murky swampland in central Florida" (p.1). Walt Disney essentially decided that he was not going to believe in mediocrity but seek out greatness and trust his intuition. This ideal has led to an extensive amount of business strategies that the company has successfully and effectively used throughout the years.
Per Coverly (2013), the Walt Disney Company is built on excellence in terms of strategy construction. This essentially means that from top to bottom, there is an extensive quantity of collaboration and sharing of ideas. The company believes that in order to be excellent that an environment of communication should be encouraged, and that those who are not necessarily in leadership positions still play a pivotal role in goal execution and overall culture (p.1). As a result of the business strategy of excellence, this has promoted growth in its marketing of its portfolio as well.
Built on the premise of engendering creativity and innovation, the marketing strategy of the Walt Disney Company is primarily focused on crafting memorable experiences for its customers. This has translated across each of its portfolio areas. From film to products to the theme parks, the Walt Disney Company is modeled on several distinctive marketing strategies. It appears as though the primary marketing strategies that the Walt Disney Company uses are: mass marketing and social media marketing.
Mass marketing is a specific type of strategy that uses a significant amount of efforts to grow. This can encompass direct marketing of different and new items, to savings, to general identification of its name in conventional advertisements on television and radio. It can be argued that the Disney name highlights a considerable notoriety and this is due to its extensive mass marketing efforts over the years. With respect to social media marketing, the company is noted for its usage of each of the platforms to engage customers.
Hill (2010) contends that because of the company's reputation of defying convention, that it seeks to lead by example through being a creative force in not only American culture, but worldwide (p.1). As such, through the use of social media platforms, the company can diversify its name across each of the products in its portfolio. Simply put, through social media marketing, the Walt Disney Company can inspire customers to purchase its products, see its films, visit its theme parks while keeping with its overall mission and vision. These two marketing strategies as a result, have afforded the company to remain competitive. The following is a competitive profile matrix that illustrates and showcases how the company’s strengths and weaknesses against its competitors. Two of its main competitors are Viacom and Twenty-First Century Fox.
Based on the CPM, the Walt Disney Company has the highest score over its main competitors. This suggests that in the identifying critical success factors that it comprehensively understands what to do with respect to its customers. This does not mean that the company does not have any weaknesses however. As noted in the CPM, the company is denoted as having some difficulty in customer retention and successful new introductions, even though it is frequently cited as an innovator and creative behemoth. The question becomes, what is the issue with respect to the weaknesses? In other words, why does the company have weaknesses in these areas?
Recommendations for Strategy Review, Evaluation and Improvement
It can be said that the company has had its share of struggles. One of the key weaknesses related to the company is that almost all of its products are centered primarily on children. From the films to the theme parks, the company is about unlocking children’s appetites for fun and frolic. This has hurt the company to a certain degree, because adults cannot necessarily enjoy any of the items within the portfolio. Having a limited target audience does not bode well in the long term as it does not drive appeal to customers outside of said audience. Moreover, by having a niche market to a certain degree, companies and brands limit themselves. Yet, because the Walt Disney Company is built on the structure of children and their attitudes and behavior, having them as a target audience has led to a significant reputation as being a leader in family entertainment. The weaknesses have often been turned into positives even though they are cited as problems that the company has. In essence, the company has been able to use the weakness and turn it into a strength across the target market audience that it has had for decades.
Nielsen (2014) delineates that the Walt Disney Company is always one step ahead of the competition. The company has a time-honored tradition of extensively using its portfolio to the best of its ability in order to keep consumer consumption and demand extremely high. Despite the changes in technology and overall consumer behavior, the company continues to comprehensively look at factors that will drive future growth (p.1). To this end, the company needs to focus on its opportunities which are expanding its target audience, and moving into countries other than the UK, Canada and China.
In tackling the former, this can be done via its film arm. Most, if not all of the cinematic pictures that have emerged from the company are animated, or children live action. The company with its recent acquisition of Lucasfilm can capitalize on appealing to a more adult audience. This will mean financing and producing movies that its competitors, particularly Twentieth-Century Fox, are not afraid to make. While in the short term, this might make the company be viewed to changing direction, in the long term, it will only make the company stronger and more proficient in the area of entertainment.
Sullivan (2016) contends that by expanding its portfolio and reputation into other countries that the Walt Disney Company will be able to successfully grow its brand (p.1). It can be argued that it isn't necessarily a necessity for the company to adapt to foreign markets, by the company at least acknowledging this need, they stand to gain substantially. Therefore, the company needs to make certain that it effectively examines the opportunities connected to its continued growth and notoriety in the world. In doing so, the behemoth can only grow and become an even more recognizable force in the entertainment industry as the world progresses into the 21st century.
Financial Statement for Walt Disney Company
Presently, the Walt Disney Company's stock is priced at $99.28 as of March 17, 2016. As of January 2016, the company's revenue was $15,244,000 with a net income of about $2,880,000. Moreover, the company had an operating income of $3,908,000 (Reuters, 2016). The company is doing fairly well in terms of revenue and overall profit, with Yahoo Finance (2016) noting that the gross profit as of the end of January 2016 was $6,621,000 (p.1).
Recommendations for Annual Goals and Policy According to Projections
It can be said that the company still thoroughly understands how to capitalize on its strengths and also comprehends its weaknesses and threats in terms of its financial position. Essentially, the company is not necessarily doing as well as it could be doing, but is performing relatively well based on its reputation in North America and international countries such as Canada, UK and China, which it also operates within. As such, the recommendations for the Walt Disney Company would be to remain steadfast in what they have done so far within North America, UK, Canada and China, while also addressing the weaknesses and threats over the course of the year, to the extent that they can.
SWOT
According to Harrington (2015), one of the key strengths of Disney lies in its content integration. The company thoroughly and extensively utilizes its brands across numerous segments. An example of this is with the movie, Frozen, which grossed roughly $1.3 billion, but also "inspired a television crossover, a Broadway musical and a theme park attraction. This type of cross-platform integration is unmatched by any mass media company on the planet" (p.1). Additionally, the Walt Disney Company is frequently noted for its cash surplus. The company as documented by Harrington (2015) effectively understands how to leverage its cash through its operations. This has only skyrocketed with the recent acquisition in 2012, of Lucasfilm (p.1). While these are not the only strengths related to Walt Disney Company, they are prime in terms of the weight in which they offer to the conglomerate's dominance in entertainment.
Regarding the weaknesses, Harrington (2015) identifies that the company's growth in terms of its television operations has been stagnant because of the emergence of on-demand services (p.1). The company has not been able to effectively leverage its brand name in order to capitalize on the industry. Platforms such as Amazon Prime and Netflix, have successfully utilized the streaming option appeal, to hurt the Walt Disney Company. Unless viewers are watching television shows on-demand, the amount of viewership for ABC, ABC Family, Disney Channel and others will continue to falter gradually. It seems as if another one of Walt Disney Company's weaknesses lie in the overall costs associated with doing business in entertainment. Particularly, the company uses a substantial amount of moony in obtaining the broadcasting rights for sports. This coupled with the volatility at movie theaters, because of a myriad of reasons has led the company to incur numerous losses. An example of this is the film, John Carter, which generated a "$200-million-dollar loss [due] to poor marketing" (Harrington, 2015). The company simply is not able or rather has had enormous difficulty adjusting to the sign of the times in viewership and movie attendance. It would appear as though even with the entrance of newer stories and characters across its brands, that consumers are proverbially not buying what Disney is selling – at least not at the present moment.
As far as opportunities, there are many. Disney can broaden the scope of its markets. Currently, the Walt Disney Company operates in North America, Canada, the UK and China. This affords the company a significant opportunity to take advantage of untapped markets in showcasing and displaying its brand. It is critical to note that the current operations do not suggest that the company is not known in other countries, but Disney does not have specific, calculated and strategic ones in countries other than the aforementioned ones. To this end, the Walt Disney Company can mount significant and substantive competition against Viacom and 21st Century Fox, before its rivals do it for them. Another area of opportunity for Disney is in its eco-friendly image. The Walt Disney Company (2016) cites its DisneyNature arm as an eco-friendly part of its operation (p.1). While this is not the only area where it is eco-friendly, the company has since the arm's foundation in 2008, cultivated an environmentally tailored progression in the area of motion pictures - specifically, documentaries. Disney should engender more films oriented toward presenting an eco-friendlier image, while simultaneously developing products that are aligned with tis symbolism.
Harrington (2015) highlights that the threats related to the Walt Disney Company include alternatives to digital media and competition from its rivals. For the former, while the company has made strides in certain areas of the digital space, it would seem as though the company waited too late to establish its role within the space (p.1). This does not mean that the company cannot elevate its stance within the digital media space, but that it has a steep hill to climb because other companies tapped into before Disney. Regarding the latter, Harrington (2015) stresses that the competition related to the digital fold, and entertainment in general continuously fights the Walt Disney Company. This has caused "the company to engage in competition with local, nation, and international" (p.1) outlets at all times, despite its dominance in the entertainment world.
Appendix A
External Factor Evaluation Matrix
Appendix B
SWOT Matrix
Appendix C
SPACE Matrix
Appendix D
Internal Factor Evaluation Matrix
References
About. (2016). The Walt Disney Company. Retrieved from https://thewaltdisneycompany.com/about/
Coverly, C. (2013, June 7). The business lessons behind Disney’s magical experiences. Financial Post, Retrieved from http://business.financialpost.com/executive/business-education/the-business-strategy-behind-disneys-magical-experiences
David, F.R., & David, F.R. (2015). Strategic Management: Concepts and cases: A competitive advantage (15th ed.). Upper Saddle River, NJ: Prentice Hall.
Harrington, R. (2015). SWOT analysis: Walt Disney Co. Value Line. Received from http://www.valueline.com/Stocks/Highlights/SWOT_Analysis__Walt_Disney_Co_.aspx#.VtxVSI-cEss
Hill, B. (2010, January 26). Walt Disney’s 8 secrets to success. Retrieved from BusinessBrief website: http://www.businessbrief.com/walt-disneys-8-secrets-to-success/
Nielson, S. (2014, January 8). Travel back in time to learn more about the Walt Disney Company. Market Realist, Retrieved from http://marketrealist.com/2014/01/disney-outlook/
Sullivan, J. (2016). Walt Disney Co. Is Focused on the Future: Setting Sail in 2016 and Beyond. The Motley Fool, Retrieved from http://www.fool.com/investing/general/2015/10/22/walt-disney-co-is-focused-on-the-future-setting-sa.aspx
The Walt Disney Company. (2016). Retrieved from http://disney.com/
The Walt Disney Company. (2016). Yahoo! Finance. Retrieved from http://finance.yahoo.com/q/ks?s=DIS+Key+Statistics
Walt Disney Co. (n.d.) Reuters. Retrieved from http://www.reuters.com/finance/stocks/companyProfile?symbol=DIS.N
