How Disney+ Is Giving Netflix Goosebumps: The Marketing Strategy Decoded
Table of contents:
- Why Disney+ Became an Instant Success
- It’s All About Franchise IP: Quality Over Quantity
- Number of Films With $1 Billion+ Worldwide Gross
- Unique Brand Value
- Superior Content Monetization Capabilities
- Long-Term View on Profits
- Micro-Bubble Winner
- Historical Vs. Market-Implied
- Conclusion
Walt Disney, only the title brings up memories of childhood and pleasant feelings, such as the joy of going to Disneyland or the fantasy of a movie that started in the opening sequence with the famous castle.
1.Why Disney+ Became an Instant Success: The brand name conjures nostalgia and joy. ‘Disney’ evokes creativity and a dream world, and it is not easy to contend against it.
Most of us have strong memories of classics like Bambi, The Jungle Book, The King of the Lions, Musical High School, Caribbean Pirates, and countless others. All that sensation embodies Disney, the company, and magic.
Their several acquisitions over the years, as if all of them were part of a bigger scheme foreseeing the possibility of streaming.
- The Walt Disney Company reported that Disney+ had nearly 95 million subscribers (statistica.com)
- 51% of Gen Zers and Millennials think Disney Plus is as good as Netflix. (martechadvisor)
- Disney’s streaming services now have a combined total of 137 million subscribers (verge)
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Imagine the opportunity to sell a brand that incorporates all these properties. Promotions were put across these platforms and brands for the launch of the app. Retail stores owned by Disney and the TV networks, including ABC, ESPN, Freeform, and FX, promoted the app extensively before launch.
It’s hard to believe, but a product superior to the current king, compared to the $12.99 for Netflix’s famous plan, kept the price for all this at just $6.99.
In pop culture, Baby Yoda from the Disney+ series The Mandalorian, which premiered on the day the app was released, has become a trend. The character went viral and got a lot of affection, appearing in internet-wide memes. Click here for digital marketing services from PROS.
2. It Is All About Franchise IP: Quality Over Quantity: The average person can’t watch or even try to navigate through too much television to find out what’s best. The awful feeling of scrolling through a seemingly infinite list of shows and not being sure what to watch is known to anyone who has Netflix or some other streaming service.
As customers become more overwhelmed by the amount of content and respond better towards popular characters and franchises, Disney stands to gain.
No other business may boast of expertise or the same degree of franchise IP. Over the past three years, Disney has produced 11 billion dollar movies, more than double any other studio combined.
3.Number of Films With $1 Billion+ Worldwide Gross: The Skywalker Rise, which will be published before the year’s end.
As Disney+ opens, these massive franchises give Disney a key advantage. Most of the marketing of the streaming service has been related to these franchises, whether it’s the latest Star Wars show The Mandalorian, the promise of future ties with the Marvel Cinematic Universe, or just the vast classic film library of the company.
4.Unique Brand Value: The business has the unique benefit of having its own distinct and famous brand, in addition to Disney’s tentpole franchises, something that no other entertainment company can assert.
They all know what a Disney movie is like or a Pixar movie, for that matter. Even though the business tells a completely different story, viewers are interested in high-quality content due to Disney’s excellent track record.
5.Superior Content Monetization Capabilities: No other entertainment business better monetizes content than Disney. This gain was referenced by Iger on the company’s most recent income call.
It can extract value from a wide variety of companies as Disney produces effective content. Not only does a hit franchise like Star Wars make billions at the box office, but it also sells toys and merchandise, produces the potential for spin-off TV shows, forms the basis for theme park attractions, and now, with Disney+, contributes to a streaming service library.
These numerous channels of monetization offer Disney a crucial advantage over Netflix. Disney+ is yet another link for Disney in the chain, another way to extract value from IP that can be monetized in many different ways as well. On the other hand, Netflix has only one platform for monetization of online subscription sales.
6.Long-Term View on Profits: Combined with Disney’s excellent corporate governance, all the unique advantages above make me optimistic about the acquisition of 21st Century Fox. Disney will be able to produce an exceptional amount of value from the content it acquired from Fox over the long term,
A huge hit from the Fox purchase is Disney’s free cash flow. Besides, the acquisition of $71 billion on this scale will take a while to integrate and produce a range of unusual expenses.
Many of these expenses would be accounted for in my models, such as $1.2 billion (2 percent of revenue) in restructuring and impairment charges and $1.6 billion (2 percent of revenue) in fair value step-up costs.
7.Micro-Bubble Winner: With a price to economic book value of 2.6, Disney is expensive but that’s just because the valuation accounts for all the extra shares and debt from Fox when the company has only just started making the extra profit from the sale. PROS is the best internet marketing san diego company
8. Historical Vs. Market-Implied:
- The Time Value of Money: Disney produces substantial cash flow right now. Since money is more worth in the future, Netflix needs to gain even greater profit the future.
- Capital cost: The weighted average cost of capital (WACC) is used by the reverse DCF model as the discount rate for potential cash flows. Netflix has a much higher WACC than Disney, with its more volatile stock and higher credit risk. As a consequence, a higher obstacle to achieving the anticipated return for investors must be evident.
Conclusion: Netflix and Disney+ continue to gain market share. The above information and the given points will definitely help you understand why Disney+ is giving Netflix goosebumps and will surely make you choose the right platform for your entertainment.
