WELCOME TO THE WORLD OF DISNEY

- Disha Itkelwar

A CASE STUDY :DISNEY CONSUMER PRODUCTS :MARKETING NUTRITION TO CHILDREN

WHERE THE MAGIC BEGINS…..

WALT DISNEY(1901-1966) :A pioneer of the American Animation Industry.Founder of the Walt Disney Company.

Synopsis of the Situation• In 2004,health experts estimated that more

than 30% of American children between the age of 5-9 years were overweight and 14%were obese.

• Disney consumer products were subject to growing criticism from activists,parents and governments.

• They believed that The Disney Company contributed to the growing obesity epidemic.

1923 : Debut of Mickey mouse i1923 : Debut of Mickey Mouse

in steamboat willie

1932 : Disney won the academy award for best

cartoon

1950 : Expansion beyond films andTelevision

1955 : Opening of Disneyland inCalifornia

1980-1990 : Renaissance of Disney Animation

2004 : Breakout of Obesityepidemic

2005 : DCP embarked on mission to improve nutritional value of its licensed food products HISTORY

Major Businesssegments of

Disney

Disney Consumer

ProductProducts

Media and Networks

Parks and

ResortsStudio

Entertainment

Merchandise Licensing• DCP was responsible for extending the

Disney brand to merchandise ranging from apparel,toys,home decor,books,interactive games,food,beverages,electronics.

• In 1954,Disney capitalised on the persuasive power of television.

• In 1996,,DCP signed an exclusive,10 year,$2 billion deal with McDonald's

• In 2005,DCP was the World’s largest licensor with more than $21 billion in retail sales of licensed products.

Disney enjoyed a 25% annual growth rate in 1998 and 1999

It experienced a 10-15% decide in sales in the U.S and Japanese markets.

Over the years,Landscape was changing and licensees were not as willing to have terms dictated to them

Outcome of DCP’s licensing

Let us have a look at the leading licensors

SHIFT AWAY FROM THE LICENSING ONLY BUSINESS MODEL

“We wanted to focus on product innovations,creativity and quality,and

building relationships with key retailers”

: Andy Mooney,DCP President

The question in our mind is :How did Disney face the obesity epidemic ?

• It conducted a research to size the food business opportunity

• Using focus groups,group sessions and shopping trips with mothers,DCP set out to learn which products market would support

• It discovered that the children influenced the purchase decisions.

• It knew that mothers wanted to purchase nutritious products.

• It determined the key product categories .

THE SURVEY

INSTITUTE OF MEDICINE RECOMMENDATIONS

Actively promote healthful diets for children.

Create children’s products to reduce calories, fat, salt and added sugar while improving nutrient content.

Develop an “empirically validated industry-wide rating system” for labeling and advertising that appealed to children and conveyed nutritional information.

Enforce strict marketing standards for traditional advertising.

Avoid linking “nutritionally questionable” products to admired celebrities, sports figures, or cartoon characters .

Kids eat the wrong food ,too much of wrong food.

Promote healthier food products.

Division of products

Treats

DrinksSnacks

Side dish

Main Meal

GOALBalance its portfolio so that 85% of its products could be classified as main meal, side dish,

snack or beverage and only 15% could be categorised as treats.

DCP’s “BETTER FOR YOU” guidelines

• controlled levels of added sugar• no trans or hydrogenated fats• limited calories• minimise the use of additives

DISNEY & IMAGINATION FARMS

Disney began licensing its characters to Imagination Farms, a national fresh produce marketing company

Increasing the consumption of

fruits and vegetablesamongst children

Adopted a value addedstrategy to build

the brand

They tried to explainnutrients in a

kid friendly way

Taste, Nutrition and Magic

COMPETITORS

Disney and Kroger

• Kroger is a Cincinnati-based supermarket,the largest pure grocery retailer in the United States.

• Kroger stood out against many for Disney for its willingness to commit to a larger product line.

• Disney was successful in having one major DTR relationship in a country where the retailer had 10-20% of market share

Launching Disney Magic Selections

SOME MORE NUTRITIONALLY BENEFICIAL CHANGES….

Eliminate trans fats from food

served at its parks and all of its

licensed products by the end of 2008

Preparing to ship winter fruits and

vegetables

provide healthier options

Risks along

its way..

Some of the many challenges

• Pricing and Value • Legacy• Growth and Distribution • Differentiation and

Competition

FUTURE

Capitalise on the vast resources

Extend its offering to food service,out-of-

home consumption

Publish cookbooks,TV cooking

shows

Gain market share and

acceptance

SUCCESS

SUMMARY

1. Synopsis of Situation2. History3. Major Business Segments4. Merchandise Licensing and

Outcome5. Survey related to Obesity6. IOM Guidelines7. Division of products 8. “Better for You” guidelines9. Disney and Imagination farms10.Disney and Kroger11.Nutritionally beneficial changes12.Risks and Future

Created by Disha Itkelwar,VNIT Nagpur during a marketing internship by Prof. Sameer Mathur,IIM Lucknow

DISCLAIMER