Essay on Walt Disney

2536 Words Feb 7th, 2015 11 Pages
STRAT Case Study
“The Walt Disney Company: Its Diversification Strategy in 2012

February 9, 2015
February 9, 2015

KEY ISSUES * Understand why a company’s resources and capabilities are central to its strategic approach: Diversification is Disney’s main strategy for constant growth. The company is broadly diversified, including five major segments. Disney attempted to capture synergies existing between its business units. * Strengthening a company’s market position by expansion: Disney aims to expand globally and exploit the business opportunities in the emerging market since the domestic market is about to be saturated. * Become aware of what the company should do to achieve operating excellence: Instead of
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According to the case, Disney’s corporate strategy mainly focus on (1) creating high-quality family content, (2) exploiting technological innovations to make entertainment experiences more memorable, and (3) international expansion. In general, Disney has been focusing on an offensive strategy recent years. The company acquired some very valuable brands such as Pixar and Marvel, which were all very successful acquisitions and has created high cash flows for the company. Even though Children are always the target audience for Disney, they are not the cost driver for Disney. Therefore, Disney always aims to create attraction for the whole family instead of only focusing on Children. Segment | 2011 Revenues (in millions) | Parks and Resorts | $9,302 | 41% | Media Networks | $8,790 | 39% | Studio Entertainment | $1,733 | 8% | Consumer Products | $1,933 | 9% | Interactive Media | $768 | 3% |

The domestic market for Disney is about to saturate. One of the strategic priorities of Disney is to internationally extend its impact by expanding in to growth market such as China and India, which has large population and potential growth. The Company invested nearly $15 billion in capital in its businesses from 2008 to 2012, including a 43 percent investment in a $4.5 billion theme park in China. Disney planed to construct two new 340-meter ships for its Disney Cruise Line, and the acquisition of Pixar and

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