3. • Founded in October 1923, by brothers Walt and Roy O. Disney
as the Disney Brothers Cartoon Studio.
• The company operates in five business segments: media
networks, studio entertainment, consumer products, interactive
media and parks and resorts.
• Mickey Mouse was created in 1928 and during that time
Disney.
• Launched many other famous characters, such as Minnie
Mouse and Donald Duck.
• Today, many big studios, TV stations, and intellectual
properties, including Marvel Entertainment, ABC, Pixar
Animation Studios, fall under Disney umbrella.
• By 1932, the Disney Company won its first Academy Award for
Best Cartoon.
COMPANY OVERVIEW
4. • In 1955, Disney opened the first Disney theme park,
Disneyland, in California.
• Since the 1980s, it expanded its influence with the debut of
the Disney channel on cable TV.
• In 2006, Disney purchased Pixar as it began to focus on digital
animation. Pixar Animation Studios earned prestigious awards
for its digital animation.
• In 2009, the company acquired Marvel Entertainment and in
late 2012, Disney began its acquisition of Lucasfilm, which
included rights to the “Star Wars” franchise.
• It continued its digital expansion in 2014 by acquiring
YouTube content producer Maker Studios, which became the
Disney Digital Network in 2017.
5. •Disney plans to launch its own digital streaming network in late
2019 which will enable subscribers to watch movies and shows
whenever they want.
•Disney Consumer Products is the world largest licensor and
delivers toys, apparel and books. They operate 350 Disney retail
store worldwide.
•The segment park and resorts comprises five vacation
destinations with 11 theme parks and 44 resorts.
•At the moment Disney has approximately 201,000 employees
around the world and with total equity of US$ 52.832 billion.
6. Micro environmental factor effect
The micro-environment of a business includes the factors in the immediate area
of operation affecting its performance and decision making freedom.
They include competitors, customers, distribution channels, suppliers, and the
public. These factors affect the performance of the business in several ways and
understanding them is important for strategy formulation.
8. • The secondary segment is considered secondary because they have
already experienced the traditional Disney atmosphere.
• Disney strives to cater to small children who have not experienced
the initial thrill of Disney like the primary market has.
• Disney’s primary and secondary target markets are very trusting of
Disney’s brand due to its exceptional customer service and wide array
of offerings that satisfy both segments wants, needs, and desires.
• With their transformation in design, quality, and product innovation;
Disney has been able to improve consumer perceptions of their brand
significantly.
9. Competitor analysis
• The main competitors of Disney are: Viacom(VIA), Time
Warner(TWC), 21st century Fox(FOX), Sony(SNE),
CBS(CBS) and Comcast(CMCSA).
• These companies compete with Disney's products mainly
through TV, cable and other media markets such as
DVD/Blue-ray, video games and the internet.
• Disney also competes in the strong and lucrative sports
market.
• In the theme-park, major rivals to Disney include
Six Flags Entertainment, Universal Studios & SeaWorld
Parks and Entertainment.
10. Market share
• Last year, Disney’s overall market share for the domestic box
office was 26% placing the studio ahead of its five major
competitors.
• 20th Century Fox, a longtime rival, had the fifth-largest share (9.1
percent) and more than 1 billion dollars in grosses.
• Together, Disney and Fox now command 35 percent of the movie
market—a historic number for cinema.
11. SuppliersSuppliers
We believe that including diverse suppliers in our sourcing process
provides us the greatest opportunity to develop the most
innovative, highest quality, and most cost-effective business
solutions.
Disney draws on suppliers from around the world to feed its
multimedia needs, relying most heavily on companies in the
United States.
Disney’s list of major suppliers consists of companies from the
United Kingdom, France, Israel, Japan, Canada, Australia and
Switzerland.
12. Distribution Channel
Disney Media Distribution (DMD), a DBA of Disney–ABC
International Television, Inc., is responsible for The Walt Disney
Company's branded and non-branded filmed entertainment
distribution, now distributing more than 30,000 hours of content to
over 1300 broadcasters across 240 territories worldwide. The
company is operated under Disney's Direct-to-Consumer &
International division.
On July 18, 2019 -- The Walt Disney Company announced today
that it will combine all of the Company’s media sales and channel
distribution into one organization under Justin Connolly, who has
been named president, Media Distribution.
14. 1. The bargaining power of buyers is relatively high mainly due to low
switching costs.
2. The bargaining power of suppliers is relatively low.
3. The threat of new entrants is also very low as the entry barriers are very
high due to immense capital requirements.
4. The threat of substitutes is rather high for the whole industry as there are a
lot of other activities a family can do in their free-time like visiting
museums, go hiking in National Parks, going to cinemas or making
vacations abroad.
5. The rivalry within the industry is intense as customers have low switching
costs.
15. Macro environmental factor effect
There are mainly six factors (PESTLE) which determine the external marketing environment and over
which marketers have little control:
16. Political factor:
Policies and governmental actions are evaluated in this component of the PESTEL/PESTLE
analysis framework. In this business analysis of The Walt Disney Company, such remote or
macro-environmental factors pertain to the political climate affecting merchandise trade and
entertainment access. For example, intellectual property policies impact the global business. In
the entertainment, mass media, and amusement park industry environment, the following
political external factors influence Disney’s strategic management:
1. Stronger intellectual property protection (opportunity)
2. Shifting free trade policies (threat and opportunity)
3. Stable political conditions in major markets (opportunity)
Political external factors create opportunities to improve the conglomerate’s business
performance in the global market.
17. Economic factor:
This component of the PESTEL/PESTLE framework assesses the economic trends that shape
the remote or macro-environment. Disney’s case involves diverse economic conditions,
considering the multinational reach of the business. Many of the relevant economic external
factors reflect the American industry environment, which is the company’s main source of
revenues.
The Walt Disney Company’s strategic management success depends on the economic
conditions linked to the following external factors:
1. Rapid economic development of developing markets (opportunity)
2. Increasing levels of disposable incomes (opportunity)
3. Slowing growth of the Chinese economy (threat)
18. Politiical and legal factor:
Social And Culture Factor:
The focus of this component of the PESTEL/PESTLE analysis framework is on social trends, which
affect Disney’s remote or macro-environment through customers’ and workers’ behaviors. In this
company analysis case, consumers’ behaviors toward products like movies, television programs, video
games, and amusement parks are considered.
The Walt Disney Company experiences the effects of the following sociocultural external
factors:
1.Favorable attitudes toward leisure (opportunity)
2.Increasing online activity (opportunity)
3.Increasing cultural diversity (threat and opportunity)
19. Technological Factor:
Available technologies are among the remote or macro-environmental factors that define
business capabilities and limitations. This component of the PESTEL/PESTLE analysis of
Disney accounts for technologies used in entertainment and mass media production, as well
as those used to develop Disneyland theme parks and resorts.
The following technological external factors determine many of the strategies and
management efforts at The Walt Disney Company:
1. High R&D rate in the industry (threat and opportunity)
2. Increasing mobile device use (opportunity)
3. Increasing popularity of augmented reality (opportunity)
The technological external factors in this component of the PESTEL/PESTLE analysis of
The Walt Disney Company present growth opportunities in the industry environment.
20. Environmental Factor:
The natural environment imposes limits, threats, and opportunities in the remote or macro-
environment, highlighting business dependence on ecological external factors.
Disney’s management faces strategic challenges related to the following ecological external
factors:
1.Changing and worsening cyclical weather (threat)
2.Increasing availability of renewable energy (opportunity)
3.Increasing industry support for sustainability (opportunity)
21. Legal Factor:
The legal factors evaluated in this component of the PESTEL/PESTLE analysis pertain to the rules
and regulations that apply to the business and its industry environment. In this case of The Walt
Disney Company, such external factors are based on the legal systems that define the leisure and
recreation remote environment. The company’s managers must address regulations based on
different countries and regions involved in the macro-environment.
This component of the PESTEL/PESTLE analysis points to the following legal external
factors that impose limits and requirements on Disney’s global business:
1.Environmental protection law (opportunity)
2.Improving legal protection for consumer rights in developing markets (opportunity)
3.Broadening intellectual property protections (opportunity)
