Page 94 - The Disneyization of Society

MERCHANDISING

compared to the situation nowadays, even allowing for inflation and other
changes (see below).
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However, between the time of the death in 1971 of Walt’s brother, Roy O.
Disney who took over the reins after the death of Walt in 1966, and the arrival of
Michael Eisner as chairman and his team, there is evidence that merchandising
was not being pursued as actively as it might have been. At the time of Eisner’s
arrival, Disney was languishing and had barely managed to fight off a takeover
aimed at plundering its stock of films and intellectual property which was seen as
a cash cow. Also, the theme park visitor numbers were down so that less money
was being spent on merchandise and other on-site facilities. Consequently, the
hugely profitable revenues and profits that could be derived from merchandise
sales were not being realized. Disney adopted five major strategies that would
increase its commitment to merchandising. In each case, merchandising was not
the sole reason for the strategies – nothing ever seems to be done by Disney for a
single reason because of its commitment to synergy.
First, Disney increased visitor numbers in two main ways. Advertising and pro-
motion were greatly stepped up. Prior to the arrival of the Eisner team, there had
been very little of either. Second, attractions that would appeal to teenagers were
developed and introduced into the parks, such as a simulator ride based on Star
Wars and a 3-D film with Michael Jackson as the captain of a space flight. The
strategy was extremely successful in spite of the team pursuing an additional strat-
egy that might have had an opposite effect on visitor numbers, namely, regularly
increasing the cost of admission, which was seen by Eisner and his team as
too low.
A third component of Disney’s post-1984 strategy that was geared towards
merchandise was to take a more active role in developing deals. Eisner has writ-
ten that at the time of his arrival ‘licensing was essentially a passive business.
Disney played almost no role in the production, distribution or marketing of
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these products.’ By 1994, operating profits in consumer products had quadrupled.
A fourth component is the Disney Store, the first of which opened in 1987 in
Glendale Galleria in Southern California and which has since been rolled out
worldwide. When the idea of a Disney Store was floated to Eisner, he has written
that he liked the idea because they could promote Disney films and theme parks,
as well as sell merchandise.
A fifth strategy was to increase the production of animated feature films. Prior
to Eisner’s arrival, the quality and quantity of Disney animation had fallen.
Animation had come to be seen as costly and the full range of advantages of ani-
mation had not been fully appreciated. In 1979 one of the leading animators,
Don Bluth, left the company with a number of others, citing the problems that
they were having with the production of good quality animation as the reason for
their departure. Producing uninspiring and often poor quality (by Disney stan-
dards) animation had had a deleterious effect on merchandise sales deriving from