This was a project designed by a group of students (Brittany Jackson, Clarissa Schmidt) from Full Sail University and myself (Antonio Ortiz) on a company business model for "Disney Music Group".

1. A Business Model
Brittney Jackson, Antonio Ortiz, Clarissa Schmidt
Project By:

2. Value Propositions
What value does the company give to its
customers?
• Disney Music Group is home to Hollywood Records,
Walt Disney Records, DMG Nashville and Disney Music
Publishing. The labels’ genre-spanning rosters include
Demi Lovato, Selena Gomez, Queen, Joywave, Sabrina
Carpenter, Bea Miller, R5, Lucy Hale, Grace Potter &
The Nocturnals, Redlight King, ZZ Ward and
more. DMG also releases family music and film and
television soundtracks such as Guardians of the
Galaxy, Iron Man, Frozen 2, High School Musical, Mary
Poppins Returns, Shake It Up, and TRON:
Legacy. DMG is also home to all the iconic Disney
Classic songs created for Disney Movies and Disney
Channel Shows, such as “Into the Unknown”, “Whistle
While You Work”, “You’ll Be In My Heart”, and “Zip-a-

3. Customer segments
• Disney's target market may appear to be just children, but the fact of the matter is that their main
focus is on the whole family. Disney's target market varies from children, to tweens, to
teenagers and even adults - practically anyone who is young at heart. As Walt Disney himself
once quoted "Your dead if you aim only for kids. Adults are only kids grown up,
anyway." You can see the multi-generational focus if you watch the commercials for their
theme parks or by simply watching one of their animated movies; some are aimed at parents,
some are aimed at children, and most have something that appeals to both. The demographic
target would be: families.

4. Channels
Disney Music Group reaches its audience in a number of
ways including:
• Motion Picture Soundtracks
• Radio Disney
• Television Channels (Disney Channel, Disney
XD, National Geographic, ESPN, ABC,
Freeform, Disney Junior, etc.)
• Disney Parks (Florida, California, Hawaii, Paris,
Shanghai, Hong Kong)
Disney Cruise Line
• Social Media Communication (LinkedIn,
Facebook, Twitter, Snapchat, Instagram,
YouTube)
• CD, DVD, BluRay sales

5. Channels
Social Media is the most cost-efficient & wide-
reaching channel DMG utilizes. This method is
free, with the exception of the employees who
run the accounts. With the large following on
each platform, Disney is reaching millions with
every single post and/or advertisement. DMG
uses these platforms to promote their products
such as songs, music videos or movies,
television shows and attractions that feature
their music. With platforms such as YouTube,
not only are they advertising their products,
they are earning revenue from AdSense each
time a consumer views their video. The Walt
Disney Company has one of the most
prominent social media followings compared to
other widely-followed brands.
• Facebook followers: 52 Million
• Instagram Followers: 24.4 Million
• Youtube Subscribers: 18.9 Million
• Twitter Followers: 6.7 Million
• LinkedIn Followers: 3.5 Million
(continued)

6. Customer Relationships
• For example, the Disney Film “Frozen” was the highest-
grossing animated movie ever. It had kids around the
world by the ears with its “Let It Go” single; selling 10.9
million copies in 2014. This keeps a strong relationship
with customers through manufactured Frozen products
like toys, electronics, and clothing. Some may include
coupon benefits like“$10 off the DVD with this purchase”
Disney connects with fans through the beloved movie by
keeping it relevant in every opportunity, having the
characters available for meet and greets in theme parks
and continually playing the soundtracks from both the
first and second movie in places the target audience
frequent.
Disney has a big reputation on succeeding their
customer satisfaction especially since they are a
family oriented company, by creating an authentic
relationship with their customers and continually
renewing that relationship in meaningful ways.

7. Revenue Streams
They have four main revenue streams that earn the majority of their profits from their music
division (Disney Music Group). These include: media networks, parks, experiences and podcasts,
studio entertainment, and direct-to-consumer, and international. Revenue is also earned from the
sales from movie soundtracks, merchandise, concerts and other streams that Disney pursues to
make profit for its company.

8. Revenue Streams
• Media Networks- This comprises over 44% of the operating incomes for
all segments with a wide variety of cable networks from Disney, ESPN,
Freeform, FX and National Geographic. Their Revenue grew 13.3%
during FY (2019) to $24.8 billion, comprising 35% of Disney’s total
revenue. They generate music sales from TV series or movies that are
being played through these networks for example “The Hannah Montana
Show” which is aired on Disney. They create the music for its TV series.
• Parks, Experiences, and Products- This revenue stream is comprised of
their theme parks and resorts located in Florida, California, Hawaii, and
Paris. This includes other ownership interests at resorts in Hong Kong
and Shanghai. Many of this revenue income is made from merchandise
sales at the theme parks. For example, “Frozen” products. Their revenue
grew 6.2% during FY (2019) to $26.2 billion, comprising 37% of Disney’s
total revenue.
• Studio Entertainment- This revenue stream is engaged in motion picture
production and distribution through Walt Disney Pictures, Twentieth
Century Fox, Marvel, Lucasfilm, Pixar and other companies. Their
revenue comes from licensing motion pictures to theaters such as sales
of DVDs, Blu-ray, and other formats. Their Studio Entertainment grew
10.6% during FY (2019) to $11.1 billion.
• Direct- to- Consumer & International- Includes branded international TV
networks and other channels such as Disney, ESPN, FOX, National
Geographic, and Star. Also it has a new direct - to - consumer streaming
service called Disney+ and the segment revenue includes advertising,
affiliate fees, and subscription fees. This revenue stream pushes their
music in other countries outside of the United States and helps their
company on larger scale of selling units from Disney music division.
(continued)
Revenue of the Walt Disney
Company in the fiscal year of
2019

9. Key Resources
• Physical- They can distribute most of their
products through large retailers like Wal-Mart,
Target, Amazon and many more. This could
include Movies, CDs, or Merchandise being
distributed through Disneys music division.
• Intellectual- Includes brands, patents and
copyrights, partnerships, and customer
databases The Disney Music Group has a very
strict use of their trademark works that they
take very seriously. This means many of their
artists would be under certain restrictions on
music that is created by their company.
• Human- They rely heavily on human resources
as one of their target markets. They have a line
up of great artist such as; Demi Lovato, Taylor
Swift, Ariana Grande, Miley Cyrus, Hannah
Montana and more. These artist have a wide
variety of fans between ages 4 - 55.
• Financial- Most of Disneys Music Group
Finances determines the production from a
soundtrack to a movie or even an artist’s solo
album. This is a key factor on bringing the right
talent to the table. The main goal is bringing the
right act that children will love because children
are the biggest demographic in their target
audience.

10. Key Activities
• Publishing - Disney Music Publishing is a division of
DMG, responsible for publishing the work of artists
under the label. They also hold the rights to
soundtracks, which include popular songs such as
“Let It Go”, “Spoonful of Sugar”, and “It’s A Small
World”. As of 2018, DMP expanded its relationship
with Universal Music Publishing Group, to European,
African, and Caribbean territories.
• Marketing - The marketing team collaborates with
other divisions of DMG to come up with timing and
release strategies for new releases. They come up
with strategies to increase sales revenue and
customer satisfaction
• A&R - In this division, the representatives are
responsible for pairing the right artist to cover classic
songs, signing and developing artists, and
determining their musical style before recording.
Having the right artist covering Disney classics
Ken Bunt, President of
Disney Music Group

11. Key Partnerships
• Disney Music Group expanded its
partnership with Universal Music
Publishing Group globally, including
continental Europe, African, and
Caribbean countries, among others.
The deal, "expands the territories in
which UMPG will administer DMP’s
catalogs," (UMG).
• In 2017, DMG partnered with DigiTour
Media, a social media festival
production company, to launch RMI
Recordings. The new label signs the
viral talent that perform at DigiTour’s
concerts and festivals.

12. Cost Structure
• Fixed costs: employee salaries, royalties, cost of
studio/office space
• Variable costs: artist/employee commission, advertising
and marketing fees, cost of artist and production
Disney Music Group is a value driven business. The
business prides itself on creating soundtracks with the
best artists to bring families together. Since it was founded
64+ years ago, consumers have been charmed by the
original tunes and kept coming back for more.

13. References
• Watson, A. (2019, November 11). Walt Disney revenue by segment. Retrieved April 24, 2020, from
https://www.statista.com/statistics/193140/revenue-of-the-walt-disney-company-by-operating-segment/
• Group, U. M. (2018, June 29). Universal Music Group (UMG) & Disney Music Group (DMG) Expand
Agreement Globally. Retrieved April 25, 2020, from https://www.prnewswire.com/news-releases/universal-
music-group-umg--disney-music-group-dmg-expand-agreement-globally-199163341.html
• Gensler, A. (2017, July 3). RMI Launches Partnership With Disney Music & Hollywood Records.
Retrieved from http://www.rmistudios.com/news/2017/7/3/rmi-recordings-launches-partnership-with-
disney-hollywood-records
• Universal Music Publishing Group and Disney Music Group Expand Relationship. (2018, January 16).
Retrieved from https://www.universalmusic.com/universal-music-publishing-group-disney-music-group-
expand-relationship/.
• Whitmore, L. B. (2017, January 16). Front and Center: Dani Markman, Director of A&R for Disney Music
Group. Retrieved from https://www.thewimn.com/front-center-dani-markman-director-ar-disney-music-
group/.
• Limited, S. (n.d.). About Us. Retrieved from https://www.disneymusiclicensing.com/pages/about
• Walt Disney Company. (1970, January 1). Chapter 4: The Marketing Environment. Retrieved from
http://thewaltdisneyco.blogspot.com/2011/09/chapter-4-marketing-environment.html
• Munson, B. (2017, June 21). Disney dominates U.S. Media social interactions index. Retrieved from
https://www.fiercevideo.com/broadcasting/disney-dominates-u-s-media-social-interactions-index