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Diversification at the Walt Disney Company - Case Study Example

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The author of this case study entitled "Diversification at the Walt Disney Company" focuses on the business of Walt Disney Company that was started by the Disney brothers, began as a studio producing cartoon series like the Donald Duck and the Mickey Mouse. …
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Diversification at the Walt Disney Company
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Download file to see previous pages Walt Disney Company’s first encounter with diversification started the moment a businessman sought permission, from the Disney brothers, to use Mickey Mouse images in promoting drawing tablets. This encounter led to the establishment of the Mickey Mouse Club to spearhead the trading in products with animated characters of Walt Disney. Today, Disney Stores retails in stationery products, clothing, food and beverages, literary materials, home décor, and clothing line.
Common resources and capabilities ensure that all activities of the Walt Disney Company are linked towards business strategy in two ways; one, resources and capabilities provide direction for business strategy; and two, resources and capability ensure the profitability of the company. Disney’s capacity to earn greater profits depends on two major issues; attractiveness of the entertainment industry, and competitive advantage it has over competitors. The extended product scope of the Walt Disney Company has given it a competitive advantage over other players in the entertainment industry. Through studio entertainment branch; Disney produces and distributes animated movies and acquire rights to other entertainment content. Through the Media Network branch, it distributes media services to families; the Media Network entails; television stations, radio stations, publishing operations and cable networks (Dobson and Richards 83).
Resources and capabilities of the Walt Disney Company provide direction because they are all geared to serving only one market segment, entertainment; the diversification program is meant to ensure customer satisfaction in the entertainment sector. Disney theme parks are an extension of its core business because the ideas and characters appearing in films provided the basis for the fantasy environment. This created a circular relationship; where films promoted the theme parks and vice versa. The theme parks include the Florida Walt Disney Resort, California Disneyland, and Disneyland Resorts in Paris, Hong Kong, and Tokyo. ...Download file to see next pagesRead More
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