Swot Analysis of the Walt Disney Company

Assignment 4-SWOT Analysis of The Walt Disney Company

Madhusudhana Rao Pidkiti

International Technology Management

The Walt Disney Company was founded in the year 1923 with its headquarters in California. The company was founded by Roy O. Disney and Walt Disney.  The company has five wings through which it performs the business, they are Interactive Media, Parks and Resorts, Studio Entertainment, Media Networks and Consumer Products, where each and every wing is assigned to perform different kind of operations. As of 2012 the company Revenue is about 42.2 billion with the profit of 5.6 billion and having employees of about 166,000 (Jurevicius, 2013).

SWOT ANALYSIS OF THE WALT DISNEY COMPANY

STRENGTHS:

1. The company has a strong television base throughout the world which is one of the major advantage for the company. The company owns most famous television channels such as Disney  Channel and ESPN where both channels are having more than 250 million of subscribers and beside this the company also owns broadcast network namely ABC which is also a strong assert for the company.
2. Another major strength for the company is the Brand Value or Brand Reputation of the company throughout the world. The people know the company for nearly a decade because of their cartoon characters which are famous all over the world and movies which came from the house of Walt Disney are also very famous along with Disney Resorts and Parks and studios, which created a huge Brand Value.
3. The companies like Pixar, Marvel, Lucas films which are once a huge competition to the Disney studios, are later bought by Disney which has become a major strength to the company as the competition by these companies became null.
4. The company is operated by five different wings namely Interactive Media, Parks and Resorts, Studio Entertainment, Media Networks and Consumer Products. Where these wings have their own kind of strategies for each and every country depending upon the country’s economy. By this way it helped the company to sustain in hard situations also.
5. By understanding the domestic market, the company started to produce the products which suits the taste of the local buyers which helps the company to capture the local market as well (Jurevicius, 2013).

WEAKNESSES:

1. At present situation the company is performing almost at 200 countries around the world. But the major revenue is from the U.S. and Canadian markets, where 70% of the company revenue is from the U.S. alone. This is not a good sign for the company, because if there is any fluctuation in the U.S. economy or market it directly shows impact on the company’s operations and on revenue. Beside this the competitors are concentrating on getting the revenue from all over the world without depending on the U.S. market.
2. In the recent years the company has acquired many of its competitors. The last transaction of the company’s acquisition is must be approved by the Federal Trade Commission so that the company need not deal with the antitrust problems. If Federal Trade Commission did not approve these kind transactions then the company must face antitrust law problems. And more overly the company has does not have much scope in doing business by acquisition (Jurevicius, 2013).

OPPORTUNITES:

1. In some developing and developed economies in the region of Asia Pacific it accounts about 50% of market of TV subscribers. In the present coming years this figure can be double and mainly in the countries like India and China. The company has already started its business in these countries along with other growing economies. So, that in future the company will be able to grow big in these countries by capturing local market.
2. Along with the TV subscriptions, the company has also scope in the movie making business in the local markets like India  and China where the costs for producing the local movies is comparatively low and can create good market for the International companies(Jurevicius, 2013).

THREATS:

1. The fields where the company is performing the business has huge competition around the world. Even though the company has brand reputation around the world, the local competitors are giving a huge competition for the business as the local competitors will have an edge in providing services according to the local customer needs.
2. Piracy has become a major problem for the film industry. At present scenario due to latest technical advancements many of the movies are available to watch for free in the internet, so that the percentage of people watching the movies in the cinemas are reducing gradually which results in loss of money for the movie makers.
3. Online TV and Online movie rentals are growing at a greater pace. Many of the customers are showing interest in Online TV and movie rentals rather than for the cable subscriptions. As the company do the business in both the industries i.e. cable provider and movie making it is more risky to balance the both fields while compared to the companies performing business in single field (Jurevicius, 2013).

References

Jurevicius, O. (2013, February). SWOT analysis of Walt Disney. Retrieved from http://www.strategicmanagementinsight.com/swot-analyses/walt-disney-swot-analysis.html