The Walt Disney Company and its subsidiaries is a giant entertainment company that operates worldwide. The company whose common term is Disney is considered the prime media multinational company globally concerning its revenue. It was founded on 16th October, 1923 by Roy Disney and Walt Disney (Brothers). Starting as an American animation leader, the company rose and expanded to become the leading company in the media industry. Today, the company owns the best studio in Hollywood (Walt Disney Motion Pictures Group), a renowned television network (ABC TV Broadcast) and other major investments that will be mentioned later (Capodagli & Jackson, 2001). There basically five segments in which this company operates in, and these include; Parks and Resorts, Media Networks, Interactive Media, Consumer Products, and Studio entertainment.
The company owns 51% shares of the Disneyland Paris, a property in Marnela-Vallee (5510 acres) and a major investment. Disney manages and owns an equity interest of 40% in Euro Disney S.C.A. The equity interest of the company in The Active Network, Inc. is 18%. In Hong Kong Disneyland Resort, the company owns an interest of 47%. The company is said to have completed a major deal in which they completely acquired Marvel Entertainment, Inc. on 31st December, 2009. In the following year, on 31st March, the company also acquired another company by the name Retail Networks Company Limited. Finally, in the same year on 27th August 2010, the company fully acquired Playdom, Inc. (Books 2010).
Indeed the management of Disney incorporates management change. The organizational structure of Disney is build on a creative process rather than the common top down or flat reporting structures. At Disney, it is clear that the process is much respected and the creation of the final product is respected by every position, including the administration (Capodagli & Jackson, 2001). The mission statement of the companies is "To be one of the leading producers and providers of entertainment and information in the world. With the use of our brands portfolio to differentiate our services, content and consumer products, we seek to develop the most innovative, creative and profitable entertainment experiences and related products worldwide." The production process of the firm can be described as very innovative and captivating in the sense that it is purely based on addressing the needs of the customers. The fact that Disney as grown from a very humble beginning to become of the largest media corporations is a proof enough that it gives its customers what they need. It is true that the company aspires to address the needs of its customers as well as ensuring that they give quality products and services (Capodagli & Jackson, 2001).
Disney acknowledges that their employees and the cast members are the people behind the magic. They try creating an optimal experience for the employees as they meet their business requirements. The values and culture of Disney reinforce the company's responsibility and commitment towards their employees. Disney has designed programs that are meant to meet the satisfaction of the employees and these programs involve giving services such as; Talent Acquisition, Employee Services & Events and the Learning & Development Programs. The company also ensures that there is effective communication in regard to business strategies and initiatives, recognition of employees, business ethics and conduct and practices of social responsibility among others (Capodagli & Jackson, 2001)..
Concerning the marketing mix in which the product, place, price and promotion comes in, the company has strategized perfectly towards this. The ABC Television Network, which is owned by the company, broadcasts its programs together with other commercial announcements at a fairly low price. ABC.com that provides a broadband subscription to a 24-hour live internet news channel as well as news reports (video-on-demand) coming from all the news broadcasts belonging to ABC. This venture brings a lot of revenue to the company. In addition, the company is known to carry out production and distribution of live action as well as animated TV programming. As mentioned earlier the company owns and operates Parks and resorts, which brings a lot of revenue to it in this sort of industry.
As at 2nd October last year, the company was operating seventeen resort hotels with an approximation of 468000 conference meeting space and 22000 rooms. There is also a sports complex under the company that provides professional training as well as holding competitions, festivals, tournaments and other interactive activities related to sports at a charge. The company owns other lands in different areas where it operates some other investments. Other business involves; production of animated motion pictures, conducting live stage plays and music recordings. The company is involved in the distribution of produced films, television market and home entertainment. The filmed products of the company are distributed through its own marketing and distribution companies (Capodagli & Jackson, 2001).
The company also deals with some consumer products that touch on manufacturers, licensees, publishers as well as retailers to enable them to develop, design and promote their products as with the use of its publishing, merchandise licensing, and retail businesses. The range of products includes; apparel, toys, furnishings, home décor, stationery, accessories, consumer electronics, foot wares, health and beauty, and foods. The company also has some characters, which it licences in its television, films and other properties to earn royalties that are based on the retail or wholesale price percentages of the concerned products. A good number of such Companies include; Mickey Mouse, Toy story, Disney Princess, Disney Fairies, Cars, Winnie the Pooh, Spider Man and Hannah Montana among others. The company is also involved in designing individual products as well as creating exclusive seasonal and themed advertisement campaigns for retailers on the basis of TV shows, movies and Characters.
Disney is recognized in many countries in publishing books of children and magazines in a multiplicity of languages. It offers young children classroom programming in terms of hours, earns promotional as well as publishing revenues. The Disney branded entertainment as well as the lifestyle content athwart interactive media platforms are created and delivered via its Interactive Media Group. The main operating business in this case is Games that creates multi-platform games as a way of worldwide distribution and Online, which majors in the production of Internet Websites in the US and other international countries. The Interactive Media Group creating generates its revenues from combined sales of wholesale, sponsorships, advertising, online games accessories and subscription service charges. The body is also in charge of managing the mobile phone business (branded) in Japan providing mobile services to consumers (Books 2010).
Despite the fact that the corporation has had upward growth, growing from a very simple but innovative idea to a leading industry that is known worldwide, the fact that there are other emerging companies that are posing competition to this particular industry, it is hard to determine that Disney will be able to sustain its growth in the future (Walt, 1995). For the past few years the returns of the company or the net income has been fluctuating with a close range of percentage and this proves that the industry has become quite competitive. The financial health of the company improved notably especially on television, assisting the company report an profit increment of 18 percent in the fourth quarter of 2009. This was alongside a soft quarter in theme parks and a dismal one in movies (Guffey, 2006).
The studio had lost money in two consecutive quarters, in the tune of $13 million (movie studio) and a percentage increase of three percent. However, the overall net income for the company was 895 million for the quarter ending on 3rd October 2009 a rise from $760 million in the previous year. The net income in the fiscal year from $4.4 billion to $3.3 billion. In 2010, the net income for the quarter ending on April 3rd was $953 million which was slightly higher than the previous quarter. A slight increased was witnessed towards the beginning of this year and this proves the unwavering trend of the performance of the company (Books 2010).
The company has invested a lot in terms of technological advancements to ensure that it maintains its competitive advantage. In fact most of the services and products that they offer are linked much to technological requirements and most of the clients that they have are people who are updated in terms of the modern technology. As a result of this, the company must ensure that they update themselves and their staff in regard to most current technology to ensure that they address the needs of the customers (Guffey, 2006). The company uses their website as an advertising platform and thus generating some revenue from it. The company updates its website on regular basis and as a result, it stands out among its major competitors based on the clarity and address of the customers' needs (Books 2010).
Business Environment & Ethics
It is wise to analyze the business environment before carrying out any major investments and this is a factor that Disney considers to be very important. This is to analyse both the opportunities and threats surrounding the business. Some of the factors that Disney considers for example are the behavior trends of the people in general (Books 2010). The company ensures that the cast members and the employees are well trained through the learning management system of the Company on how to act legally and ethically in compliance with the Business Conduct and standards. One is the trend of people attending the parks and their need for recreation during the weekends. This is a factor that affects the business positively based on the fact that they are able to sell their services in the parks and results and also sell things like the games, toys, internet time for the people in need of recreation facilities (both children and adults).
Other factors that may affect the business in terms of its environment are political and legal environment and this in most cases it affects the business in a negative way. For example French politicians were greatly opposed to the idea of Theme Park near Paris opening. Despite the strategic location of this paper because it is right at the center of Europe, this thing has received a lot of criticism. However, in terms of the social impact that these facilities have on the local residence, it is quite positive. Most of the people have embraced the idea quite positively. Their products encourage social interactions and offer the best solutions in terms of recreation.