SWOT ANALYSIS

A SWOT analysis is a tool frequently used in business analytics that allows decision makers to
examine their business from multiple angles in order to obtain an objective viewpoint and make
educated decisions.

A SWOT analysis first examines a company’s internal strengths and weaknesses these may
include finances, company reputation, or access to goods and resources.

A SWOT will then determine the company’s external opportunities and threats. Opportunities
could be technological breakthroughs or market trends, while threats may be competitors or a
region’s financial state

The primary objective of a SWOT analysis is to examine a company’s internal strengths and
external opportunities to leverage against the company’s internal weaknesses and external
threats

The SWOT analysis allows managers to consider all viable aspects of the company that could
influence the company’s environment and use these findings to enhance the company’s
position within the overall corporate structure and value chain

The SWOT analysis uses strengths to optimize opportunities and avoid threats, eliminates
weaknesses to create opportunities, and defensively decreases weaknesses to avoid threats.

A SWOT analysis allows an organization to examine the internal strengths and weaknesses and
external opportunities and strengths that will have an effect on the success or failure of
decisions made by that organization

SWOT ANALYSIS OF DISNEY

STRENGTHS

Disney name recognition – The Walt Disney Company has branded itself very successfully in the
past. It is known as one of the best entertainment companies and its parks are known as one of
the most entertaining places in the world. Disney owns a large proportion of childhood
characters of whom some become children’s role models. In this way, Disney is ever-present as
children grow into adults with more purchasing power.

Loyal fan base - One of the major factors that has contributed to Disney’s continuing success is
the company’s extremely loyal customer base. When consumers purchase a Disney product or
experience, they expect that purchase to be enjoyable and magical, which will encourage
consumers to come back to Disney to make more purchases in the future.

Diversification - Disney’s diversification identifies new products and markets that are close
enough to its core business that the company can leverage its internal strengths to create
business growth. many consumers will be surprised to learn that ESPN and Freeform are also
Disney companies. The company has also acquired the rights for all Star Wars and Marvel
franchises and their related products

Synergetic marketing strategy - Walt Disney Company employs several masterful marketing
tactics that allow it to constantly remain one of the most powerful companies in the world. The
existing synergistic marketing strategy, in which purchasing one Disney product/experience
drives consumers to purchase another product/experience

Global reach - Disney reaches a truly global audience because of the universal themes in its
entertainment shows that transcend language and culture. It has also established 11 theme
parks worldwide to promote awareness of the brand and penetrate new markets.

WEAKNESSES

Expensive products and services - the Walt Disney Company is the company’s reputation for selling
products or services that are quite expensive .  consumers are willing to pay for the privilege of
owning Disney products because of the company’s brand equity – but only to an extent. Disney
services are expensive, and its cable channels are often not included in standard cable package.

Heavy dependence on income from North America - Disney operates in more than 200
countries, it heavily depends on US and Canada markets for its income. More than 70% of the
business the revenues come from US alone, while the major Disney’s competitor News
Corporation receives less than 50% of revenues from US, making it less vulnerable to changes in
US market.

Omnipresence or Disney-ization of society - is the negative connotation associated with the

“Disneyization” of society, a concept that hypothesizes that Disney’s influence has spread so
widely and rapidly that the company’s presence is everywhere, even places that consumers do
not always notice.

Limited target audience – Children are the biggest influencers in an adults life. However, they
are not the revenue drivers. Disney is limited by its abilities as it has only children as its target
audience. With Universal studio also on the rise, Disney needs to diversify its target and get
involved with adults as well. After all, adults are the one who pay the money.

Character development is slow – Today, There are very few new characters which are
generating revenues equal to mickey mouse or Donald duck. In India itself, Chota bheem and
Ninja hattori have overtaken Ben 10 and other cartoons which are developed by Walt Disney.
Thus, developing more localized characters is a need in the market.

OPPORTUNITIES

21st Century fox acquisition - in late 2019, Disney acquired 21st Century Fox and its streaming
service Hulu. but the company will also gain the rights to the 20th Century Fox studio, FX
Networks, National Geographic, and all of 21st Century Fox’s existing library of content. This
will 31 grant the company even more diversified means of profit and allow Disney more power
in the overall entertainment industry, assisting in the company’s rising above competitors in the
streaming market.

Repurchasing film rights - Disney owns the rights to a majority of popular culture’s notable
characters, from princesses to superheroes to monsters. This allows the company to re-release
merchandise or content with these beloved characters at any time, successfully managing each
character’s story along the way. This will allow Disney to diversify its programming reach to
children and adults alike.

Possibility of replacing other streaming services - The Walt Disney Company is the opportunity
for Disney+ to become a replacement for current streaming services that are purchased by a
family. Because Disney+ is both less expensive than major competitors and has entirely family-
friendly content, this service may fit a family’s needs more than current streaming options do.

Changes in media consumption in children – the children of today are more technologically
savvy than ever. They are also more empowered about what they watch, with studies showing
they spend almost 11 hours a day consuming media across various devices. This represents a
huge opportunity for Disney market their content.

THREATS

Mature streaming market - While the streaming market is mature and the platform’s
competitors are quite successful in their own rights, there are several factors that will help set
Disney up for success in its launch. Netflix and Amazon are long-established players in this
segment that Disney will find difficult to take market share from.

Strong competitors - The presence of strong competitors in the streaming market. Netflix has
the competitive advantage of being the first mover, or the first company widely known in a
specific market. Netflix, Amazon, and Hulu all pride themselves on the creation of original
content, which motivates consumers to choose one service over another. Another advantage
that major streaming companies have that Disney does not is that they are not bound by having
to fit all content under one brand umbrella
More parents becoming anti-technology - as children become more technologically advanced,
some parents are becoming more anti-technology in order to preserve a child’s innocence and
shield them from the “real world” as much as possible.

May make Disney content less available to the masses - the restructuring of all Disney content
for Disney+ may make some content less available to the general public. While Disney used to
focus on developing original content to place on the Disney Channel or Disney Jr., the
company’s focus has now shifted to developing content for Disney+.

SWOT ANALYSIS OF 21ST CENTURY FOX

Strong market penetration – 21st Century fox is one of the leading providers of media at media
and entertainment services with a strong market penetration. The company operates the
entertainment networks covering a broad spectrum of audience in its market. It's cable
network programming segment has an extensive research in the US. The company's content
which is produced once is distributed across a wide base of subscribers.

Significant distribution and licensing agreement - The company’s motion picture production
and distribution business has significant licensing agreements for the distribution of its content.
the company entered into domestic and international license arrangements with third parties
for distribution by electronic sell-through (EST), video-on-demand (VOD) and/or pay-per-view
(PPV). These enable the company generate license revenues through the distribution of
content.

Consistent performance of the cable network programming business -

The cable network programming segment is one of the fastest growing businesses of the
company. The segment is engaged in the production and licensing of programming distributed
through cable television systems and direct broadcast satellite operators in the US, Latin
America, Europe and Asia. Consistent strong performance of cable network programming
business helps the company to grow organically and to generate more revenues despite the
economic slowdown. It also serves as a competitive strength to drive growth.

Product Portfolio: 21st Century Fox has a large product portfolio where it provides products in
a large range of categories. It has a number of unique product offerings that are not provided
by competitors.

WEAKNESSES
Concentration of operation in the US and Canada - 21st Century Fox is highly dependent on
the US and Canada for its revenues. Although, the company has presence across North
America, South America, Europe, and Asia Pacific, it generates majority of its revenues from the
US and Canadian markets. Concentrating on matured markets such as the US and Canada
increases the country specific risks to the company and restricts its growth opportunities

Quality Control - 21st Century Fox has a lower budget for its quality control department than
competitors. This leads to lack of consistency and the possibility of damage to quality across its
various outlets.

Market Research - 21st Century Fox has not conducted market research within the market that
is serves since the past 2 years. As a result, it is making decisions based on 2 years old data,
while customer needs may have evolved over time.

OPPORTUNITIES

Internet - There has been an increase in the number of internet users all over the world. This
means that there is an opportunity for to expand their presence online; by using the internet to
interact with its customers.

Growing global online television and video market - The demand for online viewing of video
content has been rising at a robust pace. Online video has transformed from user generated
content hosted on a website and viewed on computer screens in the recent times

Population - The population has been growing and is expected to grow at a positive rate for the
upcoming years. This is beneficial for 21st Century Fox as there will be an increase in the
number of potential customers that it can target.

Positive outlook for DTH market in India - DTH broadcast market in India offers significant
opportunities. The increased spending power and the government's move to digitize cable
networks will drive the growth of subscribers.

THREATS

Changing consumer behavior - Rapid technological advancements have been driving changes in
consumer behavior and leading to an increased demand for digital content. The trend is likely
to be continued due to the advent of new technologies that have given viewers the freedom to
watch anything, anywhere and anytime.

Complex and challenging competitive environment - The company operates in the media and
entertainment industry, which is highly competitive. The company’s network television
broadcasting business competes with various broadcast networks, such as ABC, NBC, CBS and
The CW Television Network etc., Competition in each of these areas may divert consumers from
the company's services, which could impact its revenues and market share.