DCP faced declining sales in the late 1990s and needed to address concerns around unhealthy food products. The problem was how to get children to eat more nutritious foods while appealing to them and staying true to the Disney brand. Challenges included improving nutritional value, taste, and meeting dietary guidelines. The solution involved Disney Nutritional Guidelines to control sugar, promote nutrients, and minimize additives. A new licensing model directly sourced healthier options for retailers. Mothers associated Disney with quality but were influenced by peers and ads. The summary outlines the problem, challenges, and solution Disney implemented.

3. INDEX
History
Business Scenario
Problem Definition
Challenges
Observations
Analysis
Solution

4. HISTORY

5. 1923, The debut of Mickey Mouse.

6. 1932, Disney won the Academy Award for Best
Cartoon.

7. 1954, Disney debuted its first television program.

8. 1955, Disneyland, an amusement,
opened.

9. 1980 - 1990, Disney animation experienced a
renaissance.

10. 2004, The Walt Disney Company found itself in
the Obesity Epidemic.

11. 2006, The DCP launches offerings of fresh fruits.

12. By 2006, Walt Disney Company was comprised
of four major business segments:
Media Networks Parks and Resorts
Studio Entertainment DCP

13. DCP comprised of six lines of business:
1. Softlines (apparel, footwear and accessories)
2. Buena Vista Games
3. Home & infant
4. Hardlines (food, health & beauty, electronics,
and stationery)
5. Publishing
6. Toys

14. In 1996, DCP signed an exclusive, 10-year, $2 billion
licensing deal with McDonald’s that gave the fast
food giant the right to feature Disney Characters in its
promotions and to offer Disney toys with its
children’s meals.

15. BUSINESS SCENARIO

16. DCP planned to use its traditional licensing model when it was
satisfied that licensees could provide distribution strength,
superior product differentiation and innovation and category
leadership.

17. In 1998 and 1999, DCP experienced 10-15% declines in sales in the
U.S. and Japanese markets.

18. In January 2000, Disney hired Andy Mooney as DCP president.

19. Mooney planned to shift away from the licensing-only business
model.

20. PROBLEM DEFINITION

21. Could Disney use its “magic” to get children to
switch from sugary, processed foods to a more
nutritious diet? Could they sustain?

22. CHALLENGES

23. Disney needs to reconsider the nutritional
value of their food products.

24. The food has to appeal to children and
deliver on the brand’s promise.

25. DCP products need to meet USDA dietary
guidelines.

26. ALTERNATIVES
Keeping Traditional line:
Broad consumer base of mostly children but not supported
by government regulation and negative public opinion.
Healthy Program line:
Consumer base of mostly parents with a strong brand and a
good image but possible loss of broad consumer base.

27. Disney came up with a few
strategies:
Disney Nutritional Guidelines
3 Licencing and Distribution Model

28. Disney Nutritional
Guidelines
• Control levels of sugar added.
• Promote fibre and calcium.
• Using whole foods dense in
nutrients.
• Minimize use of additives.
• Contain no trans or
hydrogenated fats.

29. 3 Licencing and
Distribution System
Traditional Licencing System
Sourcing
Direct to Retail (DTR)

30. OBSERVATIONS

31. Mothers perceived Disney products with high
quality.

32. They associated Disney with ‘Magic’.

33. Peer pressure and advertisement influences
children’s preferences.

34. Children influence purchase decisions.

36. STRENGTH
• Brand Recognition
• Cooperates with big retailers (Kroger
Co.)
• Diversification

37. EVIDENCE

38. • Competitors
• Pricing competition
THREATS

39. OPPORTUNITIES
• Mother’s perception
• Popularity of various characters

40. EVIDENCE

41. WEAKNESS
• High risk factor
• Large R&D costs

43. • Collaborate healthy foods with Disney Programs.
• Healthy food campaign for parents.
• New characters.
• Improve packaging.

45. DISCLAIMER
Created by Atulya Manuraj, IIT Kanpur during an
internship by Professor Sameer Mathur, IIM Lucknow.