Disney Consumer Products:

Marketing Nutrition to Children

Four Segments of the Walt Disney Company

$32 Billion Company in 2005

$2.5 Billion Net Income in 2005

Consumers spent 9160 hours annually with Disney

$5.8 Billion Worth96% kids are familiar with him

$5.6 Billion Worth92% kids are familiar with this guy!

The lines of Business:Clothing and Apparel

Buena Vista Games

Home & Infant

Food, Electronics, Health and Beauty

Publishing

Toys

Merchandise LicensingLicensing and Distribution ModelsDCP had three types

1. Traditional Licensing Model2. Sourcing3. Direct to Retail ( DTR)

The DTR model was particularly successful!Relations with Wal-Mart and other retailers

Market Analysis:

Organised focus groups, group sessions and shopping trips with Mothers to understand the children’s Food Market.

In We Trust!Research proved that Mothers associated Disney with high quality & trustworthiness

And they extended these perceptions to DCP as well!

Children influence purchasing patterns

Peer Pressure affected the preferences

Finally,

Mothers wanted

Kids wanted

Controlled Portions, High Quality Reduced Sugar and fat

Fun Graphics, Good taste, Fun

The GoalGood Food, Great Fun

The Obesity Epidemic30% The Percentage of American Children between 5

and 9 years of age who were overweight

Increased Portion Sizes

Sugar Sweetened Products

Lack of Exercise

Disney Consumer Products was blamed as a contributor

But DCP saw an opportunity.

Revamping their entire product line to meet the IOM guidelines

Product Portfolio

Main Meal Side Dish Snacks

Drinks Treats

41 %

No changes required

7 % To be reformulated

28% To be phased out

To meet Nutritional Guidelines

Three approaches to creating new, compliant Disney Food Products

1.Marketing products that already had a broad appeal

2.Taking Healthier products and making them more fun

3.Partner with manufacturers and take something that is already working and make it more fun

Licensing contract to Imagination Farms

Fresh produce company

Three Pronged Strategy:•Differentiate Commodity Produce through promotion•Create value-added products through product preparation•Develop exclusive produce varieties that would yield more child-friendly foods

PLU Stickers and Innovative PackagingOne Mum said “ My daughter doesn’t pick up an apple or a peach. She picks up her favourite Disney Character”

The Competition

Though they were in the business since long, these competitors were not able to portray the magic that Disney did!

Partnership with Kroger: Largest pure grocery retailer in the U.SA New Brand: Disney Magic Selections

SWOT Analysis

Strengths

Strong DiversificationKroger PartnershipInnovative productsBrand recognitionDynamic response to market

Weaknesses

Losses due to revamping productsOutsourced manufacturingCosts for innovationInternal competition among brandsOpportunities

Disney’s Character familiarityMothers’ acceptanceResponsiveness to the obesity epidemic

Threats

Competitors like Nick, WBPricing Competition Ability to differentiate

The Disney WayUsed story telling and enabled its characters to communicate to the children

The ResultDisney made its contribution to fight Child obesity.

They revamped their product-line to suit the nutritional guidelines.

Kids are happy. Moms are happy. Disney was happy. But they took their short term financial hit.

Pricing and Value: Struggle to make quality products at competitive pricing

Legacy:Put emotion aside and concentrate on “Better for you” strategy

Competition: Competitive strategies from Nick, WB and Sesame Street

Growth:Opening many product lines made them compete against themselves.

Looking ForwardWhat should Disney do?

Create New Characters

Will ensure expansion of Market share

Healthy Foods on Disney Programs

Disney should show its characters eating healthy foods to promote a healthy lifestyle

Health Campaigns for Parents

Provide proper information to parents about good food habits and then market Disney products to them

Disclaimer: Created by, Jayanth Narayan, BITS Hyderabad, during a marketing internship under Prof. Sameer Mathur, IIM Lucknow