COMPANY PROFILE -The Walt Disney Company
Business Sector :Media & Entertainment
Operating Geography :North America, United States, Global
About The Walt Disney Company :The Walt Disney Company popularly known as Disney was established in 1924 by two brothers Walt and Roy Disney. It is a leading diversified international family entertainment and media enterprise with five business segments: media networks, parks and resorts, studio entertainment, consumer products and interactive media. The company is headquartered in Walt Disney Studios in Burbank, California and has around 201,000 employees as of 2018. Disney ranks number 4 on Fortune’s 2019 list of ‘World’s most admired companies.’
Disney commenced its victorious journey by establishing itself in the animation industry followed by films production, television and theme parks. Disney continued to acquire great companies to penetrate in newer markets and become a leader in every industry, Disney acquired 21st Century Fox last year, this is one of the notable acquisition.
Disney's mission and vision are to be leaders in both industry and business. The world's largest media company driven by a great team of leaders endeavors at producing creative and innovative content by utilizing the latest technology and penetrating in new markets. Disney’s official vision and mission statement as per its website 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.” The Unique Selling Proposition or USP of Disney unfolds to be the world’s largest independent media and entertainment company in terms of revenue, leader of American animation industry and having one of the greatest assets the Walt Disney Studio-the largest and the best studio in America.
The Walt Disney Company Revenue :
US$ 59.43 billion- FY ending 30th September 2018 (y-o-y growth of +8%)
USD 55.13 billion (FY ending September 30th, 2017) (y-o-y change of -1%)
USD 55.63 billion (FY ending September 30th, 2016)
Competitive Analysis of The Walt Disney Company
Disney's biggest strength is its "brand" that is appreciated all across the world. The world's largest entertainment company is not just recognized for the profits it makes, but for the values and ethics, it delivers through its innovative and creative content. With an efficient management team, employee base, and great leaders Disney has achieved humungous success due to its 'Characters'. Mickey Mouse, Donald Duck, Goofy etc., are some of the hugely popular Disney characters amongst children, something with which they can instantly connect with.
Diversified business models and segments, occupancy in multiple industries like entertainment, media, merchandise, and theme parks, notable mergers and acquisition, present in more than 40 countries, strong fiscal muscle etc., are also some of the other key strengths of the company.
Irrespective of all the strengths, assets, and success factors of Disney, seasonal impact on business, confined targeted audience, no localized characters based on the geographical locations, the high operational cost of theme parks limiting its expansion etc., turn out to be the internal weakness of the company affecting the brand and its operation.
Today for any organization the best way to communicate directly with its consumers is through social media platforms, Disney can take full opportunity of technology to connect with its consumers directly all over the globe. Expansion of Disney's businesses and its theme parks in developing countries is also a noteworthy opportunity.
Stringent competition from both international and local organizations is a huge threat to Disney, nowadays local cartoon characters are more influential than the Disney characters. Changing preferences and taste of the target audience (i.e. children), legal issues, piracy of films etc., are some of the external threats that can hurt the profits of the company.
The SWOT analysis for Disney is presented in a SWOT Matrix below followed by the detailed analysis:
|1. Strong brand image|
2. Diversified business portfolio
3. Strong and consistent financial performance
|1. High prices and cheaper alternatives
2. Limited television target audience
3. Lack of new characters and stories
|1. Focusing on online platform and live stream |
2. International expansion
|1. Intense Competition
2. Localization and changing cultures
3. Increasing menace of piracy
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Detailed SWOT Analysis of The Walt Disney Company
1. Strong brand image: Disney brand is known throughout the world and it has built its image for decades, first through its cartoons and now through the theatrical releases. It is considered as one of the best entertainment companies with the best theme parks in the world. The company has kept itself relevant to its customers on each of their interactions with the company and met their expectations. The other members of the Disney family such as ESPN, Pixar, Marvel and Lucasfilm have also been instrumental in the Disney’s overall brand success. Disney was named as the most powerful global brand by London-based Brand Finance in 2016 and also stood at #8 position on the Forbes Most valuable brand in 2018.
2. Diversified business portfolio: With different business segments: media networks, parks and resorts, studio entertainment, consumer products and interactive media, Disney is performing well in each of the sectors. The Company made huge gains from the movies business especially from the Star Wars. With huge success of Star Wars and Marvel, Disney’s Consumer Products segment has also been benefiting from related toys and products.
3. Strong and consistent financial performance: Disney has a very strong balance sheet, and generates robust cash flows. Both revenue and Net Income have growth steadily over the last six years growing at a CAGR of 5.2% and 115 respectively as of FY17. The management team at Disney is very shareholder-friendly and has increased the dividend payouts at an average of 17% per year over the last six years.The rest of this section is available only in the 'Complete Report' on purchase.
This section is available only in the 'Complete Report' on purchase.
1. Focusing on online platform and live stream: As most of the audience has now switched to internet, Disney should create an online platform and games to engage the audience and increase the branding of the Company. Also with the launch of ESPN plus, it Disney is well set to capitalize on the live sports streaming market.
2. International expansion: Disney currently has Parks and Resorts in Paris, Hong Kong, Shanghai, and Tokyo. The company is all set to open its first theme park in China, Shanghai. The $5.5 billion investment, the largest foreign investment ever from Disney, is a bet on China’s growing middle class and booming domestic tourism. The company should expand to developing nations such as India and in the Middle East countries such as Saudi Arabia which are opening up their economies.
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2. The SWOT analysis is a structure, employed to evaluate Disney's competitive stance by identifying its internal strategic factors like strengths and weaknesses, external strategic factors like opportunities and threats.
3. Identifying Disney’s innovative strategies that catapulted its position to a market leader in the industry and presented the company with an edge over its competitors.
4. The PESTLE analysis of the Media and Entertainment industry helps to recognize its current trends that impact the Company’s business.
5. The PESTLE / STEEPL / PEST analysis report is a structure to examine the effects of external influencers like political, economic, social, technological, legal and environmental, and their impression on the media and entertainment industry and in particular, the Walt Disney company.
6. An extensive view of Disney's business model and business diversification with further categorization and examination of key business segments and business case study.
7. Review of the acquisitions, mergers, capital raising, equity transactions, alliances or partnership ventures that Disney consented with deal valuations to achieve its milestones, business aims, and synergies.
8. Comprehensive company analysis to accumulate information about company profile, value proposition, revenue jumps, business model, business plans and marketing strategy.
9. Understanding of Disney's USP or unique selling proposition, mission statement and vision statement that has set a benchmark in the Media and Entertainment industry.
10. Identifying the core competencies, key performance indicators and success factors that contributed to the fullness of the company.
References used in The Walt Disney Company Analysis Report
1. Walt Disney - https://www.thewaltdisneycompany.com/
2. Investor Relations - https://www.thewaltdisneycompany.com/investor-relations/
3. Annual Report 2017 - www.annualreports.com/Click/23968
4. Annual Report - https://ditm-twdc-us.storage.googleapis.com/2016-Annual-Report.pdf
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The Walt Disney Company SWOT & PESTLE Analysis - SWOT & PESTLE.COM
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Walt Disney SWOT and PESTLE analysis has been conducted by Nikita Dhar and reviewed by senior analysts from Barakaat Consulting.