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Disney Is Making a Fortune and Safeguarding Its Future By Buying Childhood (economist.com)
An anonymous reader writes: Disney has been successful for the better part of a century. But they haven't always had to work as hard to do it. Over the past couple of decades, they've been facing more and better competition than ever before, and they've had to change their business strategy in response. An article at The Economist details this strategy, which seems to have a central theme: buy up things people loved as kids, and commercialize the hell out of them. The recent Star Wars film is the latest example — the marketing blitz around it (and its related merchandise) was a sight to behold. Disney is hoping that focusing investment on great content will protect them from the massive transitions underway in the content delivery part of the entertainment industry. "The biggest doubt is the durability of the model. It is not clear for how long such franchises can be stretched. And introducing new ones is a risk. John Carter, a film based on one of a series of novels by Edgar Rice Burroughs, flopped. Cinema-goers will also have far more choice as other firms try to establish or add to their franchises."
crazy back in the 80's it was as pure as the virgin mary. no tie in toys by Hasbro or Kenner. No tie in fast food. no lines to see ROTJ because of full page ads in the newspaper. George Lucas made the movies out of pure love of his fans
Just to clarify, John Carter flopped only because it had dismal marketing. It was not a masterpiece, but it was certainly better than many other recent blockbusters and with any sort of semi-competent marketing it would have been a (minor or major I don't know) success. I mean (at least until close to release) they had some boring trailers that didn't even tell you obvious things like "from the author of Tarzan" "from the director of Wall E / Finding Nemo" etc.
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Every trailer and commercial I saw for that movie came across with the message that I should already know who John Carter was. Hence as I had no idea I had no interest in the commercials, trailers, or the movie itself. I'm still not familiar with the character. They could have introduced it much better to get people to care about it; think of how Rambo: First Blood was able to get us to care about a new character for example. Instead they tried to get us to care about the character through brute force, those who didn't go for it just stayed away and the movie flopped.
Hell just a better title would have gone a long ways towards bringing in customers. Even Borat had enough of an extended title to give people some idea what they were getting in to or why they might want to see it.
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It's Oswald the Rabbit, not Oscar.
Also, kinda interesting story, Oswald was the antagonist of the game Epic Mickey. On the Idle Thumbs podcast, Sean Vanaman told the story about how he and some others were handed the Epic Mickey project because no one at Disney Interactive Studios knew what to do with Mickey. They came up with the idea to have Oswald be in the game but Disney didn't own it, NBC Universal did. They pitched it to Bob Iger who liked the idea so much that he put the wheels in motion to trade Al Michaels from Disney-owned ESPN to NBC (something Michaels had wanted to do) in exchange for Oswald and a few other things.
Vanaman tells the story that he had no idea any of this was going on until he read in the sports section "AL MICHAELS TRADED FOR CARTOON RABBIT"
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Here's my simpler version. With it's princess industry, Disney already owned the market for girls from birth to... well, death. They had no hooks for boys though. So they bought Marvel and Star Wars.
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The only way The Economist can be "interesting" is putting camel sex on their cover.
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I'm an "old" dad of 2 little kids. They're both Disney fanatics as well as big fans of other "corporate media" properties. I think some perspective is required here. Of course it makes sense for Disney to buy up things like the Star Wars franchise, LEGO (perhaps) and other 80s-kid favorites. Why? Because people who were kids in the 80s and 90s are now in their 30s and 40s, and have a lot of discretionary income to spend. I was born in '75, so I do remember my childhood being filled with a lot of true innovations in technology -- personal computers, all sorts of "new" electronic toys, Star Wars, Indiana Jones, etc. These days, the innovation is focused mainly on getting that computer in your pocket to do cool new things, but this era was a little different in that everything "computery" in the kid space was totally new. So, Disney is targeting the older parents for 2 reasons -- first, people are waiting longer to have kids, and second, those who do are having fewer and are in a better position to buy stuff from Disney. I'm sure they go after younger parents too, but younger parents are usually stretched pretty thin compared to someone who's had time to acquire some stability in their lives.
I think the key is to make sure your kids understand that even though they love their media properties, they need to remain skeptical of marketing. I'm completely unaffected by advertising, but I am seeing that my 5 year old is now starting to inquire about add-ons to "free to play" apps. I don't love the fact that the marketers are manipulating his brain, but it's a fact of life. I've explained to him (in 5 year old terms) that things cost money, that parents have to work for money, that advertisers are only trying to get you to spend more money on their product and that he shouldn't believe everything they say. It's semi-effective. We don't let them sit in front of the TV, computer or iPad forever, and don't expose them to a million commercials.
It's fine to let kids and adults enjoy Disney or whatever -- they're an entertainment business, it makes sense that people enjoy their output. The problem comes when people shut off their brains and let the advertisers in.
In spite of Star Wars success, Disney is down hard. DIS in now around $108, it was over $122 a few months back.
ESPN is a huge part of Disney's revenue, and profits, and ESPN has been losing subscribers since 2010.
Whenever a stock analyst wants Disney cheaper, they just trumpet the "news" that ESPN is losing subscribers, and Disney gets trounced. This usually happens about two months.
Let's get something clear: John Carter didn't flop because of the source material. John Carter flopped because it was a terrible movie. From the music choices, the casting, the horribly stilted dialog, the mishmash story, unimpressive sets, this film was Doomed. It pissed off the source material's fan base and left everyone else going "wait, what?" Disney knew ahead of time that they had a stinker, so they didn't waste much money promoting it, adding to its demise at the box office. (Which isn't necessarily a bad thing -- it let the film disappear relatively quietly.) Yeah, that was a really unpleasant experience.
TFA implies something that we all know will happen -- when Disney has a hit, they milk it until we're all highly sick of it. (Except, for some bizarre reason, The Incredibles, but that's another story.) The Golden Age of a Disney franchise is the first few entries, (sometimes only the first entry -cough-liloandstitch-cough- ) before the Calculated Excess kicks in.
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