Walt Disney Diversification Strategy

As can be seen from the pie chart above, the revenue generated in 2013 by the Walt Disney Company is demonstrated. Media networks such as the broadcasting business still dominated, followed by the revenue from fixed assets such as Parks and Resorts. Studio entertainment segment created a share of revenue at 13%. It is the comprehensive inclusion of five segments of businesses driving the prosperity of the business. This is due to the fact that diversification sticks to the principle of ‘do not put all eggs in one basket’, which indicates the offset of risks through building a diversified product or service portfolio. Even under the five segments, further diversification can be observed. For instance, under the media networks segment, the Walt Disney Company taps into both cable networks and broadcasting, including major areas of operations in television production, television distribution, domestic television stations and radio networks and stations. …show more content…
For instance, unexpected loss from expensive movies such as John Carter and The Lone Ranger has been a drag on the overall revenue of Disney (Market Realist, 2014). Disney took a $200 million write-down on John Carter, and expected a $190 million on The Lone Ranger (Market Realist, 2014). Nevertheless, outperformance from boosted revenues in network media segments showing an overall revenue increase of 5% successfully compensated for the loss in film market. Simultaneously, such diversification strategy can be seen as a concentric diversification which focuses on penetrating to an existing related market. Disney’s products support each segments. If a customer has purchased an animation DVD from Disney, he or she is likely to find information and content of the DVD all support and advertise simultaneously for the other business segments of