Lessons in Magic Kingdom
A new topic will add a new magic to the class
Disney attracted many consumers, including my students, and is still the best case study in school. When my teaching began at university in 2011, I had enormous flexibility to select case studies from the list. The selection was at my will away from any strict guidelines set by the administration. Many selections belonged to consumer goods giants such as Coca-Cola, Starbucks, and Uniqlo. These firms are well-known style-conscious providers for very young students in Tokyo.
Students had a lot of freedom, too. On the first day of my marketing class, I explained each student the outline of research project. Students could choose any topic. Almost every semester, at least one student chose Disney, the most successful multi-media enterprise in Hollywood.
The class on Disney needs revision now. Every semester for last ten years, students have been asked these questions. What is Disney? What is the critical success factor of Disney? What is the difference between Disney and Universal Studio? These are simple question for business professionals but not the case for university students. Yet most students turned in written assignments on time and got them right for years after years. Surprisingly, the attendance has stood consistently high. Assignments would give students no surprise and it was indeed straight-forward. I wondered if I need to revise the assignment for long time to make them a little bit more challenging than in the past. Student can expand the scope and do extra research.
A recently published story of the Economist on Disney, “Mr. Iger’s Magic Kingdom”, is a good material to revise the content of my class. The story is about Mr. Robert Iger, former chairman, and his successor Bob Capeck. Mr. Iger managed Disney for 15 years until 2019. During his tenure, Mr. Iger quadrupled the profit from $2.5bn to $10.4, which shareholders are very pleased with and let him earn the highest pay in Hollywood. Market capitalization of the firm grew from $48bn to $230bn to become the most valuable company in entertainment business in America. Disney took over a third of the film market in America.
The newspaper cites three lessons learned from Mr. Iger; high-quality products, talent management, and adaptability. First, Disney acquired high quality content production studios; Pixar with $7.4bn in 2005, Marvel with $4bn in 2008, and Lucasfilm with another $4bn in 2012. Last year, each acquisition ballooned to record billion-dollar blockbusters such as “Avengers: Endgame” by Marvel, “Frozen” by Pixar, and “The Rise of Skywalker” by Lucasfilm. Your writer contributed to Star Wars a couple times last winter.
Second, successful transition of new talents to Walt Disney culture is his achievement in talent management. Mr. Iger respected film founders such as George Lucas and Issac Perlmutter who released their control of their original animation to Disney’s board in line with high content and technology.
The third lesson was Disney’s adaptability to local taste. When Bob Iger took over the chairmanship in 2005, a Chinese venture, Hong Kong Disneyland, was a little bit bet for the firm. Mr. Iger observed the local taste very well and incorporated it into a new Hong Kong theme park. Chinese guests prefer new Pixer characters to Mickey Mouse.
With skills for M&A, talent management, and localization, Mr. Iger was ambitious enough to launch a new streaming service, Disney+ last year and the film viewers rushed to the platform. 30m subscribers turned their eyes to Disney in the streaming service where Comcast and AT&T provide their films online.
It is a good story to use for an additional challenge in my class. Half way through the course, around the eighth week, the class would be filled with a lot of Disney materials. The course will contain such topic as corporate strategy, human resource management, and marketing will be covered along with actual cases.