How the Disney ‘ecosystem’ works

Nova Safo May 21, 2015
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How the Disney ‘ecosystem’ works

Nova Safo May 21, 2015
HTML EMBED:
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Disneyland in California turns 60 this summer, and it’s kicking off festivities with a big party this weekend. Revelers can stay overnight at Disney’s theme parks in California and Florida.

But Disney, the media company, has more than a birthday to celebrate. A couple of weeks ago it reported second quarter profits that beat expectations—led by its theme parks and the film Frozen.

How can a film from two years ago still be a profit maker for the company?

“We’re a company with a very long tail,” explained Disney CFO Jay Rasulo at a media industry conference last week.

That long tail refers to the various merchandising, theme park attractions and other efforts that can generate cash from popular films and Disney characters long after they last appeared on the big screen.

Disney’s consumer product sales brought in almost a billion dollars last quarter.

“We really look at every aspect of our uniquely linked-together ecosystem,” Rasulo said at the conference.

This is the Disney way of doing things, according to Marty Sklar, a longtime company executive who worked with Walt Disney when the first theme park opened.

“It really goes back to things that Walt did in merchandizing Mickey Mouse … as early as the ’30s,” says Sklar. “So that is a pattern that was long ago established.”

Sklar says even Disneyland attractions like Tomorrowland and Frontierland were prompted from content out of Disney’s studio.

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