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Marketing What is considered marketing? © iS to ck ph ot o. co m / B ill N ol l / © iS to ck ph ot o. co m /O ST IL L Case study C

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Case study C

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Marketing What is considered marketing? ©
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Case study Chapter 2

Disney
The Happiest Brand on Earth

In 2006, Disney’s Pixar released the hit movie Cars, which
grossed $462 million worldwide. Since then, Cars mer-
chandise has generated over $2 billion in sales each year.
Pixar has since created a series of Cars shorts to be aired
on the Disney Channel with a subsequent DVD release. A
Cars sequel was released in 2011 along with an online vir-
tual gaming world on its Web site to help build hype. In
2012, Disney’s California Adventure theme park opened its
12-acre Cars Land attraction.

At Disney, the brand is the name of the game, and
the cross-platform success of the Cars franchise is by no
means an exception to the rule. Disney also has the Jonas
Brothers, Hannah Montana, High School Musical, the
Disney Princesses, Pirates of the Caribbean, and the list goes
on and on. The man behind the magic is Disney’s CEO, Bob
Iger, who has lead a dramatic revitalization of the Disney
brand since succeeding longtime head Michael Eisner
in 2005. When he first took the post, his strategy shifted
Disney’s focus to its stable of “franchises.” These franchises
are distributed across Disney’s multiple company plat-
forms and divisions, such as Disney’s various television
broadcast platforms (the Disney Channel, ABC, ESPN),
its consumer products business, theme parks, Disney’s
Hollywood Records music label, and Disney’s publishing
arm in Hyperion, just to name a few.

Iger’s franchise strategy has been supported by the
other major move he made upon first becoming CEO. On
his first day on the job, Iger told the board that revitaliz-
ing Disney’s animation business was a top priority, which
would be improved through the purchase of Pixar. As part
of Iger’s franchise strategy the deal made perfect sense, as
many of Disney’s latest television shows, theme park rides,
and merchandise were based on Pixar characters.

Finding a new market to push the Disney franchise into
became a priority as well. With the Walt Disney Company
experiencing flat growth, it was becoming evident that
Disney had missed some opportunities for broader success

due to a narrowing of its target market, which was at the
time largely associated with younger children.

Iger’s first move was to broaden Disney’s viewership
by moving the Disney Channel from premium to basic
cable and launching local versions in key global markets.
Then, Disney began pushing franchises to capture the
rapidly growing tween market. Putting its support be-
hind the Disney Channel’s High School Musical, Hannah
Montana, and the Jonas Brothers (who were emerging out
of Disney’s music label), Disney quickly generated a series
of franchise juggernauts in the tween-girl market.

Though Disney’s focus has remained on family-
friendly fare, Iger has shown a new willingness to look
to even broader markets, if it fits with the Disney brand.
Disney’s Pirates of the Caribbean, the first Disney film with a
PG-13 rating, played a major role in refocusing the brand,
being based on the classic theme park ride, and it also
helped expand the Disney appeal to older kids and even
adults. The Pirates and Cars franchises also provided pre-
liminary steps for Disney’s latest endeavors to crack the
tween-boy (age 6 to 14) market, one traditionally difficult
for media companies to sustainably capture. Their efforts
focus around the new Disney XD channel, with a broad
range of offerings, such as potential new franchises like
the science fiction action-adventure show Aaron Stone and
showcases of new musical talent. Disney will also be able
to leverage ESPN to create original sports-based program-
ming. The recent acquisition of Marvel Entertainment also
provided Disney with a broad stable of material to create
content for that platform. The channel is accompanied by
a Disney XD Web site, which will promote the channel’s
programs, as well as offer games and original videos, social
networking, and online community opportunities.

As it continues to expand and provide new franchise
offerings, Disney looks to have relatively strong momen-
tum. The success of its cross-platform franchise strategy has
certainly helped it weather the economic downturn as the

CASE STUDIES 1

effects of the recession continue to recede. Disney plans to
continue that strategy with the release of many film fran-
chise sequels, including new Cars, Pirates, and Monsters, Inc.
films. As the late Steve Jobs, former Apple CEO and Pixar
stakeholder, commented, “Family is a renewable resource,”
and right now, Disney is making the most of it.

Sources: Richard Siklos, “Bob Iger Rocks Disney,” Fortune, January 19, 2009, 80–86; Peter Sanders,
“Disney Focuses on Boys,” Wall Street Journal, January 8, 2009, http://online.wsj.com/article
/SB123137513996262627.html (Accessed November 8, 2012); Ethan Smith, “‘Alice’ Boosts Disney; Theme
Parks Disappoint,” Wall Street Journal, May 12, 2010, http://online.wsj.com/article/SB100014240527487042
50104575238640 019592022.html (Accessed November 8, 2012).

Q u e s t i o n s
1. Do a brief market opportunity analysis for Disney,

identifying the major markets that Disney has
expanded into.

2. How does Disney’s cross-platform franchising help
create sustainable competitive advantage?

3. Describe the marketing mix for one of Disney’s
franchises.

4. Describe the major components of Bob Iger’s strategic
plan.

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