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ANALYZING CONSUMER MARKETS | CHAPTER 6 179

Today, Disney is comprised of five business seg- office movies, concerts around the world, and ongoing
ments: The Walt Disney Studios, which creates films, live performances at international Disneyland resorts like
recording labels, and theatrical performances; Parks and Hong Kong, India, and Russia.
Resorts, which focuses on Disney’s 11 theme parks, Disney also uses emerging technologies to connect
cruise lines, and other travel-related assets; Disney with its consumers in innovative ways. It was one of the
Consumer Products, which sells all Disney-branded prod- first companies to begin regular podcasts of its television
ucts; Media Networks, which includes Disney’s television shows as well as release ongoing news about its prod-
networks such as ESPN, ABC, and the Disney Channel; ucts and interviews with Disney’s employees, staff, and
and Interactive Media. park officials. Disney’s Web site provides insight into
Disney’s greatest challenge today is to keep a 90- movie trailers, television clips, Broadway shows, virtual
year-old brand relevant and current to its core audience theme park experiences, and much more. And the com-
while staying true to its heritage and core brand values. pany continues to explore ways to make Mickey Mouse
Disney’s CEO Bob Iger explained, “As a brand that people and his peers more text-friendly and virtually exciting.
seek out and trust, it opens doors to new platforms and According to internal studies, Disney estimates that
markets, and hence to new consumers. When you deal consumers spend 13 billion hours “immersed” with the
with a company that has a great legacy, you deal with de- Disney brand each year. Consumers around the world
cisions and conflicts that arise from the clash of heritage spend 10 billion hours watching programs on the Disney
versus innovation versus relevance. I’m a big believer in Channel, 800 million hours at Disney’s resorts and theme
respect for heritage, but I’m also a big believer in the need parks, and 1.2 billion hours watching a Disney movie—at
to innovate and the need to balance that respect for her- home, in the theatre, or on their computer. Today, Disney
itage with a need to be relevant.” is the 63rd largest company in the world with revenues
Internally, Disney has focused on the Disney reaching nearly $38 billion in 2008.
Difference—“a value-creation dynamic based on high
standards of quality and recognition that set Disney apart Questions
from its competitors.” Disney leverages all aspects of its
1. What does Disney do best to connect with its core
businesses and abilities to touch its audience in multiple
consumers?
ways, efficiently and economically. Disney’s Hannah
Montana provides an excellent example of how the 2. What are the risks and benefits of expanding the
company took a tween-targeted television show and Disney brand in new ways?
moved it across its various creative divisions to become a
Sources: “Company History,” Disney.com; “Annual Reports,” Disney.com; Richard Siklosc, “The Iger
significant franchise for the company, including millions of
Difference,” Fortune, April 11, 2008; Brooks Barnes, “After Mickey’s Makeover; Less Mr. Nice Guy,”
CD sales, video games, popular consumer products, box New York Times, November 4, 2009.

Marketing Excellence prizes, had to live in the IKEA store for three full days be-
fore it opened, which they gladly did.
IKEA achieved this level of success by offering a
>>IKEA unique value proposition to consumers: leading-edge
IKEA was founded in 1943 by a 17-year-old Swede Scandinavian design at extremely low prices. The com-
named Ingvar Kamprad. The company, which initially sold pany’s fashionable bargains include products with unusual
pens, Christmas cards, and seeds from a shed on Swedish names such as Klippan loveseats for $279, BILLY
Kamprad’s family farm, eventually grew into a retail titan in bookcases for $60, and LACK side tables for $8. IKEA
home furnishings and a global cultural phenomenon, founder Kamprad, who was dyslexic, believed it was
what BusinessWeek called a “one-stop sanctuary for easier to remember product names rather than codes or
coolness” and “the quintessential cult brand.” numbers. The company is able to offer such low prices in
IKEA inspires remarkable levels of interest and devo- part because most items come boxed and require the
tion from its customers. In 2008, 500 million visitors customer to completely assemble them at home. This
walked through IKEA stores, which are located all over the strategy results in cheaper and easier transportation as
world. When a new location debuted in London in 2005, well as more efficient use of store shelf space.
about 6,000 people arrived before the doors opened. A IKEA’s vision is “to create a better everyday life for the
contest in Atlanta crowned five winners “Ambassador of many people.” Its mission of providing value is predicated
Kul” (Swedish for “fun”) who, in order to collect their on founder Kamprad’s statement that “People have very