MM ASSIGNMENT 5 DISNEY

Ali Asghar
Q1) Ans) Disney runs a customer-oriented business that brings the company much profit. 
At the same time, it also has developed several ways to target its core consumers. In 
my opinion, what Disney has done to connect with them is quite essential. Firstly, 
Disney starts to involve new business. As soon as Disney realizes their demands, it 
introduces Disney Channel, Touchstone Pictures and Touchstone Television. Many 
movies have been published in the name of Touchstone Pictures since 1984, such as 
splash, Armageddon and so on. It’s the pricing policy of Disney that has successfully 
reached a whole new generation of children. For example, classic Disney films on 
video are sold at extraordinarily low price, so that the majority of family can afford to 
watch these movies. Once Disney attracts those children’s attention, they will become 
its customers sooner or later. Secondly, Disney concentrates on the Disney Difference. 
Taking advantage of Disney Difference can make customers easy to distinguish Disney 
from its rivals, which leaves Disney a competitive advantage. Some high standards of 
quality and recognition movies are unique assets of Disney. For instance, one of the 
most popular situation comedies Hannah Montanais developed into a series of products, 
such as popular consumer products, live performance and so on. The diversification of 
its strength enhances chances for customers to reach Disney and its products, and 
ultimately attains their loyalty. So, Disney Difference arouses customers’ recognition and 
beefs up ties with them. Thirdly, Disney adopts the latest technologies. With the 
development of new technologies, Disney also upgrades its techniques to connect with 
its core consumers. Podcasts are a popular tool for people to communicate. Disney is 
one of the first companies to start frequent podcasts. The high exposure of Disney and 
its products results in deep impression on consumers. Web site takes customers to a 
tour of movie trailers, Broadway shows and On-line theme park experiences. This 
would make their journey to Disney more special and joyful. Now Disney makes 
efforts to enrich online resources and brings its previous cartoons including Mickey 
Mouse to the internet. The newest technology could make the cartoons cuter and gain 
their popularity again. The above steps make Disney recover from declining. Customers 
begin to come to Disneyland and enjoy Disney movies again. Nevertheless, it’s not 
enough for Disney to connect with its core consumers. Disney should build strong 
economic, technical and social relationship with customers and deliver more than what 
they have expected. Thus, high customer satisfaction makes the whole business boom. 
Disney can contact its customers by advertising. Advertising plays an important role in 
informing and influencing customers. There are a lot of competitors in the market and 
consumers have many alternatives. When they decide which products they should 
choose, advertised goods come to their mind at first. Besides, creative advertising 
causes brands to be viewed as more elegant, more stylish, more prestigious, of higher 
quality, and so on Delivering messages is an effective way to advertise. Disney can also 
launch membership card program to keep in touch with its customers. By analyzing 
customer profiles, Disney delivers its new product information, discount information and 
campaigns to customers easily. It’s cheap to do message advertising, so that Disney can 
cut the operation cost. Disney can contact its customers by promotion. Sales promotions 
can hold current consumers by encouraging repeat purchases. A little bonus will give 
consumers an incentive to come to Disney frequently. Coupons are an effective tool to 
attract customers. Normally stores wouldn’t provide discounts to customers. But coupons 
considered as bonus offered to consumers will encourage them to buy more. Although 
some of the coupons are designed to buy certain products, it’s a great benefit for 
customers and arouses their desire to shop. In addition, it’s easy to deliver coupons to 
customers by direct mail, newspaper, magazines and electronic devices. Disney can 
provide coupons to promote some products. Meanwhile, Disney also offers extra value 
to them, which will result in long-term relationship. The other tool is premium. 
Premiums are offered to consumers as a form of gift. That will reinforce purchasing 
impulse and benefit the company. After playing in the Disneyland, customers will buy 
some toys and decorations to their children. So, it’s a good chance to offer them free 
gifts. They will be very surprised to receive these and come back to Disney again. 
Especially the children, they have high impression towards free gifts and want to get 
them again. Although Disney has done its best to connect with its core customers, it 
has to synthetically apply all the methods to obtain better interaction. Customers are 
intangible assets of Disney. As long as they receive more than what they expect, high 
satisfaction will be created. It’s a great advantage for Disney to compete with other 
companies. 
Q2) Ans) After the death of two founding brothers, Disney stumbled for several years. 
The company is eager to absorb new blood to be on the right track. So, it plans to 
expand the brand into different areas. At the same time, brand expansion has brought a 
number of benefits as well as setbacks. While Disney takes the expanding opportunities 
to target its core customers and enrich its products, it has to deal with the challenges 
properly. As far as I’m concerned, expanding the Disney brand brings more benefits 
than risks. There are several benefits of expanding the brand including mass coverage, 
brand strength, maximum margin and low risk of operation. First of all, expanding into 
new areas can cover as many customers as possible. The core customers of Disney are 
children, families and adults. There are no products designed for the older audience. In 
the western countries, the number of senior citizens is growing bigger and bigger. Many 
of them have retired and they have time and high purchasing power. So, it’s a great 
loss for Disney to ignore these customers. But now Disney has launched some special 
concerts and programs for them. Not only does Disney provide a good platform for 
these elder customers to enjoy the concerts, but also a good place to chat with their 
friends. Secondly, Disney can make the most of its brand strength. Before stumbling, 
Disney has already involved film, television, consumer products, Disneyland and theme 
park. The two brothers have successfully established the brand concept of “trust, fun 
and entertainment”. Consumers around the world hear a lot about Disney. So, it’s good 
time to stretch the brand into different areas, such as clothes, decorations, cups and so 
on. These new products which bear the brand of Disney are easy for consumers to 
recognize. Disney can take this opportunity to extend its brand and get the company 
back on track. As Disney enjoys a great reputation in the market, the expanded 
products will be popular under the influence of publicity. In addition, taking advantage 
of brand strength is cheaper than creating a new brand. So, the company doesn’t have 
to invest much on advertising and marketing. Next, Disney can obtain maximum 
margin. Brand expansion enriches the products for sale. Customers come to Disney to 
ride the roller coaster, and buy these products like clothes, toys and decorations. Since 
Disney establishes its own Television and Channel, all the movies and comedies can be 
printed by its own companies. That means Disney don’t have to pay extra money to 
agencies for publicity and playing. It will save a lot of money. What’s more, the theme 
park was built in California at first, but now it expands to Japan, France and German. 
Customers in these countries are richer and would like to take their families to have 
fun at weekends. The new expansion benefits the company a lot. Finally, brand 
expansion can lower the operation risk. In the past, much income of Disney relied on 
theme parks, cartoon studio, television and consumer products. As time went by, 
consumers were tired of existing elements. So, the company stumbled for a few year. 
By expanding the brand, the new business brings Disney back to life. New platforms 
and products have been launched. Customers start to restore their confidence in Disney. 
The diversity of businesses and products can meet different kinds of demands and earn 
profits. Disney doesn’t have to depend on one or two programs to support the whole 
corporation, but on various businesses. On the other hand, there are also some risks of 
expanding the brand. One is that brand expansion may confuse the customers. All the 
new products bear Disney brand, such as watches, clothes and decorations. These 
products have no relationship with its main business. Consumers don’t realize when 
Disney expands into those areas. So, it’s easy to confuse them. Even though they have 
seen these new products on shelves, probably they won’t buy. Another is that brand 
expansion may damage the parent brand. The company has engaged in many products. 
Because of management and quality control problems, there will appear defective 
products. Once these products are in the market, consumers might have high
dissatisfaction towards Disney. That will harm the image that Disney has created “trust, 
fun and entertainment” Last but not least, brand expansion affects financial balance. In 
order to launch new products as soon as possible, Disney has to invest a great amount 
of money on development, advertisement and marketing campaigns within a short 
period. The payment becomes larger than usual, which may pose great pressure on 
finance situation. It’s likely to break the balance between revenue and payout. 
Nevertheless, with appropriate publicity, consumers won’t feel confused. When Disney 
decides to expand its brand, proper marketing techniques should be adopted ahead.