Strategic Management Report: Disney's Business Strategy Analysis

This report provides a comprehensive strategic analysis of The Walt Disney Company. It begins with an international business landscape analysis, followed by a Porter's Five Forces analysis specifically focusing on Disney Television. The report then delves into Disney's business-level strategies, highlighting both differentiation and cost leadership approaches. Furthermore, it examines Disney's strategic intent, including a discussion of a significant merger or acquisition, specifically referencing the acquisition of Pixar. The analysis incorporates key elements of strategic management, such as competitive analysis, market positioning, and strategic decision-making, illustrating how Disney has established and maintained its position in the entertainment industry. The report references academic literature and the assigned textbook to support its findings, offering a well-rounded perspective on Disney's strategic practices.

Strategic Management

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Introduction
Strategic Management is the continuous planning, monitoring, and analysis of the
environment to meet its goals and objective. In this report, the Disney has been taken into
consideration to analyse the environment. Disney is a worldwide entertainment company
which was established in 1995. It is an American diversified multinational mass media which
headquarters at California.
.
(Source: The Walt Disney, 2019)
It is a research paper in which the discussion is made on strategic management of the Disney.
In the beginning of the paper, an international analysis of business landscape will be
discussed. The company operates in many sectors but analysis of porter’s five forces will be
done on the Disney Television. After that, the business strategic analysis of the Disney
television will be discussed. In the end of the report, the strategic intent of the company will
be analysed.
Disney’s Operating Landscape
Landscape analysis is a type of organisational analysis which is used by the company to
analyse the business level. The concept focused on finding a cohesive and consistent view of

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the organisation. It is a part of business plan which helps to find out the potential
collaborators, market analysis, competitors and many others (Burns, and Dewhurst, 2016).
There are some key elements in which the landscape analysis is based such as users, scope,
methods, and parameters.
Scope
Disney is mainly focused on the Media networks and Studio entertainments in order to
provide the services to the consumers. However, the company operates in five business
segments such as Media Networks, Parks and Resorts, Studio entertainment and Consumer
Products and Interactive Media. The mission of the company is to provide the best services to
the users as compare to the competitors to satisfy the customer needs.
Users
Children and teenagers are the main users of the Disney television networks as per the
services of the company.
Methods
The company operates into the different sectors in order to achieve the success in the market
with the high value of goodwill. The company provides the different services to the users
with the purpose of entertainment (Doz, 2017). It has been seen that the company cable

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network group operates the different channels as the method to reach at the statement of
ESPN, SOAPnet networks, ABC family and Disney Channels Worldwide. It is observed that
the company adopt the method of expanding the business in the large area in order to achieve
the success like it operates these channels in the different countries like UTV and Bindass
networks in India (Market Watch, 2018).
The company communicate with the customer through the different sources of the company
such as media network. The company uses the different advertisement of questionnaires in
order to communicate with the customer. There are different methods through which the
company can collect the information through the customers.
Parameter
As per the industry, it is a first company which enter the television industry with the highly
entertainment experience. As per the customer satisfaction, the company provide the services
to the consumer as per the customer wants. It can be said that the company satisfy the users
by providing them quality of services.
Disney- A Five Forces Analysis
Porter’s Five Forces Analysis is a model which is used by the company to analyse the
competitive environment. It is useful for the company in order to develop the strategy to grab
the high market share in the market (Hanson, Hitt, Ireland, and Hoskisson, 2014). Segments
but in this section of the report Disney television has been taken into consideration to analyse
the competitive environment of the services. The analysis contains some factors and these are
as follows:

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(Source: Ansoff, Kipley, Lewis, Helm-Stevens, and Ansoff, 2019)
The Threat of New Entrants
It has been seen that the threat of new entrants is low just because of large amount of capital
is required. The Disney television production invests the large amount which is not possible
for everyone. Building an image in the market is not that easy the new entrants because it
consumer large amount investment as well as the time. The existing television production
companies have the high brand value due to which it is difficult for the new entrants to enter
the market and grab the high market share. Disney Television was the first of the film
industry who enter the TV production field. Disney entry into the TV industry and marked a
high image in the market (Pratap, 2018).
Bargaining Power of Supplier
The bargaining power of supplier of the Disney television is moderate. The suppliers of the
company are the media partners, technology companies, and the other vendors. Most of the
suppliers of the companies are Nokia, Hulu, Tumblr, Lucasfilm and many others. As per their
brand name and influence the negotiation power of the suppliers is moderate. It is difficult for
the company to switch with the other suppliers because the same options of the technology
cannot be easily available from the others. It is easy for the small vendors to switch the
suppliers but it is difficulty for the big vendors to easily switch. Disney has high brand value

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due to which it is difficult for the production to switch with the other suppliers that is why the
bargaining power of suppliers is moderate (Cision, 2017).
Bargaining Power of Buyer
The bargaining power of buyer is weak just because of the popularity of the brand in the
market. The Disney television has different channels like ABC television channels, Marvel
and many others which attract the users. The brand has developed a quite unique experience
in the market that helps to build the impressive customer loyalty. It is observed that the
Disney television production focus on the consumer experience and services which attract the
customer to towards the services of it. It is beneficial for the television production because all
of the things convert into the customer loyalty and high popularity of the customer. Due to
the efforts of the company, the consumer pay extra amount to spend a little extra as long the
matchless Disney experience is available. These extra efforts of the company reduce the
bargaining power of buyer (Ethiraj, Gambardella, and Helfat, 2018).
The Threat of Competitors
The threat of competitors is high just because of high brand value and image. There are
several Disney channels who grab the high market share in the industry. There are many
competitors such as fox studios and universal which beat the company. In this industry, there
are many companies who have high popularity that is why they trying to beat each other in
order to gain the competitive advantage (Bhasin, 2018).
The Threat of Substitutes
The threat of substitute is low just because of distinct brand image and identity of the Disney
television in the television industry. The influence power of the Disney is better and bigger

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than most of the competitors. The Disney channels are always the first preference of the
customer due to its services. The company has high market share in the television industry.
Disney- Business Level Analysis
The companies use the business strategy in order to gain the competitive advantage such as
differentiation, cost leadership and many others (Hanson, Hitt, Ireland, and Hoskisson, 2014).
It is observed that the company enter the industry and in the very less time it grow rapidly.
The company leaves a remark in the industry with its high quality of services and building the
customer loyalty. There are different strategies which are used by the company and these are
as follows:
Differentiation strategy
It has been analysed that the Disney television production adopt the differentiation strategy in
order to develop the different image in the industry. The television unit of the company uses
this strategy with the many of the operations targeting segments. It is a fact the other
competitors company of Disney mainly targets the children as per their services but Disney is
the only channel which target the different segments. It is observed that the Disney television
production target the teenagers, children and families in order to gain the high market share.
Disney television is the always remained the first preference of the consumer due to its
services (Hill, 2017).
Disney Television has different eight groups in the context of operations system such as
ESPN, ABC television group, ABC entertainment group, ABC News, ABC Owned
Television Stations, ABC Family, Disney Channels Worldwide and Hyperion. These
operations system focuses on the different functions of the television such as ABC
entertainment group focuses on the television content shown on ABC. ABC family is

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specially design for the families in order to attract the families towards the services of the
television unit of the company. These operation systems are mainly design by the unit for the
different functions which is different from the others competitors so that it can grab the high
market share (Elderkin, 2018).
Cost leadership strategy
The Disney television production enters the market where the prices are quite similar of their
services. The television unit of the company adopt the cost leadership strategy in order to
gain the competitive advantage in the industry. It is observed that the Disney is creative in
their cost structure and it is also considered a cost leader in the industry (Wheelen, Hunger,
Hoffman, and Bamford, 2017). The television production of the company offers the cheaper
cost services with the high quality of services to the users. It was previously reported that the
television unit of Disney launch its streaming services with the 7000 episodes of Disney TV.
The company announced the prices around the $8 and $14 as per the services. It is the lowest
prices in the television industry because other companies offers the high prices as compare to
the company. The company also have less subscription cost £4.99 per month as per the other
competitors of the television unit of the company (Tillman, 2018). The company also offers
the company discount on the special occasion in the terms of membership and the monthly
package discounts. The company cost leadership strategy in their channel helps to gain the
competitive advantage in the industry by beating the competitors.
Disney Strategic Intent
Strategic intents define the compelling statement of the company which the organisation
wants to achieve in the market (Hanson, Hitt, Ireland, and Hoskisson, 2014). The motive of
the company is to develop the most creative, innovative, differentiate and profitable
entertainment services in the world (Williams, 2018). The company adopt the differentiation

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and cost leadership strategy in order to gain the high market share. Disney is well popular
company in the terms of entertainment due to its different and quality of services. The
company merge with the different companies in order to provide the different services to the
consumers by targeting the different segments.
In the past years, the company merge with Pixar Company on 5th May, 2006 in order to enter
the different field. Disney was well popular company for their cartoon channels but as per
their differentiation strategy, the company wanted to enter the film field. The motive of the
company to merge with the Pixar is to produce the pictures. After the release of Toy story of
Pixar in 1997, the companies signed the deal of merger. But at the time of Toy story 2, the
agreement is break down due to conflicts arises between the companies. But then finally
companies announced the successful merger on the date 5th May, 2006. Disney was offering
the 2.3 shares of its stock to the Pixar as per the cost leadership strategy of the company. The
acquisition purchase price was $7.4billion in an all the stock deal. It is a best merger at that
time which achieves the success at the lowest prices. This case of the company states that the
company has provide the different services with the different business strategy such as cost
leadership and differentiation strategy (Disney News, 2019).
Conclusion
From the above discussion, it has been concluded that the Disney operates in the different
fields such as film, television, DTC and many others. It is observed that the company satisfy
the consumer needs and wants by providing them the quality of services. As per the five force
analysis, it has been seen that the company has high brand value in the television industry due
to which the company has low level threat from the substitute, new entrants. The company
adopted diversification and cost leadership strategy in order to gain the high market share.
The main motive of the company to use these strategies is to gain the high market share by

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providing the world best experience of entertainment. As per the past experience of the
company in the context of merger and acquisition, it is observed that the company well used
it strategies in order to provide the differentiate product with the low cost.

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