The Walt Disney Company, every child’s dreamland while growing up (and also for some of us as adults), is one of the biggest franchises in the entire world. It has a long and rich history and has gone through many changes over the past many decades that it has operated for. Does Disney even need an introduction?
Disney is an American multinational media conglomerate that has its headquarters in California. Formally, the company was established almost a century ago in 1923 and has gone through many name changes before settling on the current one.
The magic of Disney is not something that can be captured in a few lines. Disney itself could make a whole production out of the journey it has been through since its inception. Sign me up for the movie! Walt Disney started the Disney Brothers’ Cartoon Studio with his brother Roy Disney after Walt’s previous studio had gone bankrupt. Their first hit was a character that is still widely beloved today, the iconic Mickey Mouse.
Then they moved towards producing many other films and series. The company went through many changes in leadership and expansions to reach the place it is at today. In 2019 they had almost 223,000 employees and their revenue in the year 2020 was 65.388 billion US dollars. Disney is currently under the chairmanship of Robert A. Iger.
On the surface level, Disney might seem like a company that has it all set out for itself. It is the perfect big name in the industry. However, on deeper analysis, one can notice some tensions here and there that might be a cause for trouble. To evaluate these things properly and sum up how things look like for Disney right now, we will look at this Disney SWOT Analysis.
Recommended read: PEST Analysis of Disney
A look at some of the biggest strengths Disney holds right now
Market Experience and Presence
Disney has been around for a hundred years, and they have tried it all. They have had enough time to experiment within the market and see what does and what does not work for their customers. This sort of market experience can definitely come in handy.
Being around for so many years also establishes you as a trustworthy and well-known name amongst the masses. It is a brand that everyone recognizes and loves. They have acquired many other studios over the years through mergers, giving them a robust presence in the market.
The brand has diversified itself a lot over time and is currently known for many things: its film studio, television shows, streaming service, games, merchandise, and theme parks. The Disney film studio has acquired many other studios, heavily increasing its presence in the market. They currently hold other names like Pixar, Marvel Studios, 20th Century studios, just to name a few. All of these are pretty huge names on their own, so one can only imagine the profit they bring to Disney. By having such a different variety of products in the market, Disney makes itself into a name that you will hear no matter where you go.
Disney has been on the list of top ten companies by Fortune many times. It has a compelling brand image. Their logo is instantly recognizable by anyone, and their mergers have only made them more powerful.
Reports have shown Disney products to be highly popular within the consumer base. They own many popular and widely known characters, characters that many of us have grown up with and idolized during our childhood.
They have some of the best artists and writers in the world. If Disney were to come out with a new character today, people would still rush to see it on the screen because that is the power that they hold. Disney has made itself into a brand that no one can think of replacing.
Disney’s revenue for the past year looked pretty good. This income has helped Disney constantly open new projects and turn them into sources of revenue. They have a sturdy cash flow which keeps things moving and steady for them.
The finances of Disney work in a cycle: they get a ton of money from their diversified sources, which in turn helps them invest in more projects to open up more sources of cash inflow. They have mastered the art of financial stability. Their projects have also shown a good return on investment. Disney has a knack for innovation with its ever-increasing range of products.
They used their streaming service Disney+ to counter the pandemic. Their revenue from this actually increased at the end of 2020. Such strategies have helped the shareholders find new confidence in the company, something which shows by their current place in the stock market.
The company’s workforce is as magical as its productions. Disney invests a lot of money into the training of their employees, which makes them some of the most talented ones in the industry.
If one steps into Disneyland, one will see how dedicated the employees are to their work. A lot of people dream of working at Disney, which makes them very committed and loyal to their jobs.
Their creative workforce is also insanely talented. This is evident from the absolutely stunning productions that Disney is known for. Their writers and designers are indeed one of a kind. They are also some of the most experienced ones in the media industry.
The company has shown its commitment to providing a safe experience for all of its customers. They also have shown concern for many social issues such as human rights and the conservation of water.
They have a Nutrition Guideline Policy and Disney Check, which advocates for healthy living. They make their marketing strategies responsible as well because children view their content.
Understanding the weaknesses troubling Disney
Business Closure Owing to COVID-19
The COVID-19 pandemic led to the loss of a ton of money and some downsizing within the company.
All of the theme parks and other physical attractions that Disney has closed down during the pandemic, which was a huge hit on the finances of the company as it drives a good chunk of its money from these spots. They also lost a lot of their workforce due to these closures.
This was a reminder for the company to spread its financial dependence over all of its projects equally so that the sudden closure of one does not become too big of a hit for it.
When you are a company of this magnitude, there are many chances of being looped into controversies, especially related to media production. Disney was no exception to this. They have been facing criticisms over stereotypical representation of non-white characters, allegations of plagiarism, and other concerns regarding their theme parks.
As a big brand, issues like these can really hurt your reputation hence requiring you to be constantly in check of your actions.
A ‘Kid’s’ Company
Many think that Disney is a media corporation exclusively producing kids’ content. This is not true as adults have shown enjoyment for Disney’s productions and ventures too; however, the image of being ‘just another Kid’s brand’ might keep a huge segment of consumers away from them.
A report mentions that some internal rifts might exist between the company’s top leadership. A situation like this can often blow up and cause devastating impacts that trickle down to different facets of the company.
The opportunities Disney can benefit from
Disney is a globally recognized brand, and this gives them the opportunity to expand their business in other markets. They can choose to open up their physical attractions in many different locations worldwide.
They can also start providing this experience to international consumers virtually. The brand has the resources and technology to make this happen, so why not venture out in this direction?
Changing Trends in Consumer Behaviour
Disney has an opportunity that it can use to its benefit: by evaluating the changing market trends and developing products that align with that. They can innovate by bringing in new technologies. They can also use their skilled creative workforce to build their streaming service to reach the level of Netflix.
Streaming services are becoming increasingly popular, and there is a lot of room to play with here. Disney can use the different characters it holds, like those from popular names like Marvel, to develop more titles for Disney+. They can also start producing specific content for international markets.
They can also establish more of a position in the video game industry to meet the rising demand. They have a wide range of characters to make for exciting gameplay.
Certain threats lingering over Disney
Disney has had a trend of acquiring most of its competition in the market. Despite this, they still have some significant competitors left to deal with, for example, CBS, Sony, Six Flags Entertainment, etc.
Any competitor that provides quality entertainment for lower prices is especially a big threat. Different companies are coming up with new technologies as well as cheaper products that can give Disney a run for its money.
Competition is a threat that can substantially affect even the very biggest of names, and Disney is not immune to that. The company needs to come up with strategies to effectively keep this competition from damaging its position in the market.
We have seen how Disney’s different product ranges have proven to be beneficial for the company. But arguably, they can become a threat as well. If a brand becomes a jack of all trades, they might have a hard time becoming a master of anyone.
This might be a problem if the brand expands so much that it becomes hard to develop its products correctly. This is definitely a factor that the company needs to focus on while working on a variety of expansions.
There are some specific financial threats that every multinational corporation is exposed to. Currency fluctuations, inflation in the prices of raw materials, and disturbances in the supply chain are only some, to begin with. Most of these problems come up suddenly and unexpectedly.
Hence, these are all threats that a company needs to be effectively prepared for well before in time, so they can be tackled once they come up.
Pirated content is available to people very easily through the cheapest of means, often even free. It is also becoming increasingly harder to put restrictions on piracy. This becomes a threat for media companies because their legally acquired content costs more than the pirated one, and hence, people tend to move towards purchasing the pirated copies.
Disney SWOT Analysis: Conclusion
A comprehensive look at Disney through a SWOT analysis gives us a lot of insight into its operations. Disney is still one of the strongest brands in the world, and that does not seem like it will change, despite any hurdles they might face.
If Disney has certain threats and weaknesses, they also have the resources to overcome them adequately. If they make the correct use of their strengths, the magic is here to stay forever.
In case you are wondering, a SWOT analysis is a highly beneficial tool used to understand the strengths, weaknesses, opportunities, and threats that exist for any business. It proves very useful in determining the standing of any company.
We have a SWOT Analysis template that might be helpful for you if you are looking to conduct your own analysis. We also have many SWOT analysis examples for you to peruse. Looking at other SWOTs can help you draw up your own, but also it can help you understand competitor brands. For a more in-depth understanding, we have a SWOT guide as well.
Lastly, a handy trick is to draw up a SWOT table that includes a summary of your analysis. This will provide any reader with a brief look at the company. We have a guide for this purpose too. Please feel free to reach out if you have any other questions!