Disney Consumer Products : Marketing Nutrition to Children

History1923-Debut of mickey mouse in steamboat willie

1923-licensing became a formal business unit

1950-expand beyond film and television

1955-opened Disneyland in Anaheim,California

2004-the obesity epidemic

2006-DCP launching offerings of fresh fruits

Disney Consumer Products

• DCP was a global product organization comprised of six lines of business:

• Softlines (apparel, footwear and accessories)

• Buena Vista Games,• home & infant,• Hardlines(food, health &

beauty, electronics, and stationery)

• publishing and toys.

DCP’S Licensing and Distribution Models

Disney at the Supermarket DCP executives

believed that the company’s changing licensing models, retail industry consolidation and the obesity epidemic offered DCP an opportunity to simultaneously broaden and rationalize its product offerings.

In winter 2004, DCP conducted research to size the food business opportunity and to discover if Disney’s brand equity would transfer to a line of children’s food products.

Research FindingsThrough market research DCP discovered there was a gap between the foods children requested and the foods their mother was willing to buy for them.

DCP also discovered that children influence purchase decision whether they were in store with their mothers or not.

Peer pressure and advertising strongly influence kids’ preferences

Kids demand products that make them ‘in’ with their peers and that means either national or character driven products.

To appeal to mothers, products needed to be portion controlled, be high quality, taste good, omit or reduce fat and sugar and be requested by their children.

Kids want fun graphics and shapes, good taste, and great fun. Hence the products need to make them feel special and must be non-patronizing and Mom-approved.

Disney faced CRITICISM from activists, parents and government for

contributing to the growing obesity epidemic

In 2004, health experts estimated that more than 30% of American children between the ages of 5 and 9 years were overweight

Growing Obesity Epidemic

14% were obese.

Problem Definition

Can Disney be a part of solving obesity problem and use its brand strength to

reach out to children?

Could Disney use its “magic” to switch children from sugary to more nutritious

diet?

Problem Analysis

Disney saw the controversy as an opportunity to reconsider its entire range of products, hence DCP embarked on a mission to improve the nutritional value of its food products

But firstly DCP managers needed to establish credibility with U.S. governments, parents and nutritionists.-a significant challenge given the company’s existing licensing deals with candy and treat manufactures.

“Right now, kids eat the wrong foods—and too much of the wrong foods. The solution is to promote healthier categories for kids like water, milk, yogurt, and fruit, reformulate foods like cookies and cereal to be healthier and to control portions.”

-NDI,VP,Product Development,DCP

Could Disney meet up with nutritional

guidelines set up by USDA?

USDA Dietary Guidelines

That children and adults adopt a “balanced eating pattern.” They should consume a variety of nutrient-dense foods and beverages. Limit their intake of saturated and trans fats, cholesterol, added sugars, and salt.

Solution

PRODUCT PORTFOLIO

Main mealSide DishSnacksDrinksTreats

Disney’s goal was to balance its portfolio so that 85% of its products could be classified as main meal, side dish, snack or beverage and only 15% could be categorized as treats.

Disney’s Nutritional Guidelines

products would be minimally processed.Have controlled levels of added sugar.contain no trans or hydrogenated fats. Calories were limited by either adjusting afood’s formulation or its portion size.

Disney’s Nutritional Guidelines

minimized the use of additives. set limits within the problem areas of calories, fat, added sugar and sodium.promote fiber and calcium whole foods that are intrinsically dense in nutrients.

Before officially implementing its nutrition guidelines, DCP audited 2,100 of its food products and found that while 41% already complied with the guidelines, more than a quarter of its products would need to be phased out

Therefore DCP began reformulating some products and shrinking portions for others; as a result, by September 2005, 75% of its U.S. products complied with its nutritional standards. The company planned to have all its products brought into compliance or phased out by 2008.

As a result of which DCP had to part ways with its licensees who could not meet with their nutritional and portion requirements.

DCP executives knew that creating foods that met tough nutritional guidelines was only half the

battle—the foods had to appeal to children and deliver on the brand’s promise of Disney magic.

Disney adopted three approaches towards creating Disney Food Products

1. Take products that were already healthy and make them more FUN.

•2. Offer

Products that already had broad appeal.

•3. Use packaging to inspire product sampling.

The bottom line is that the food has to taste good. Kids have to like it.“If the food is nutritious, Moms like it too. Then it is a win for everyone.”

Imagination Farms Product

Disney and Imagination Farms, in March 2006 collaborated on their mission to increase consumption of fruits and vegetables among children

• By June 2006, Imagination Farms was distributing peaches and grapes with Daisy Duck and Goofy stickers

• To differentiate commodities such as peaches and apples, PLU stickers were adorned with Disney characters.

Product Development Strategy

• 1. Differentiate commodity

produce through promotion

DCP and Imagination Farms used a three-pronged product development strategy:

Product Development Strategy

• 2. Create value-added

products through product preparation or packaging.

Product Development Strategy

• 3. Develop exclusive

produce varieties that would yield more child-friendly foods.

Bagged fruits and vegetables featured a back panel that provided nutritional facts, jokes and other child-engaging information. DCP and Imagination Farms tried to explain nutrients to children in a kid friendly way.

Disney alone was not fighting Obesity. It had to face competition from multiple

companies.

Nickelodeon

As the top rated U.S. basic cable network since 1996 chose to opt in and be a part of the solution of rising obesity issue in kids’ lives.

Spinach, baby carrots and clementines bearing SpongeBob Squarepants and Dora the Explorer character images of Nickelodeon appeared on supermarket shelves in the Fall 2015.

NickelodeonBy the end of the 2005, unit sales of Darling clementines increased by almost 25% after theDora and SpongeBob characters were added to the product packaging.

Nickelodeon announced plans to extend its fresh fruit and vegetable line to apples,pears, and cherries, soybeans, and carrot and apple dips.

“My goal is to have every fruit a kid wouldwant to eat with a Nickelodeon character.” -TORRES,LICENSING VICE PRESIDENT

Sesame Workshop

Del Monte peas, corn and green beans featured Elmo, Grover and Cookie Monster characters on its labels.

Study conducted by Sesame Workshop found that preschoolers’ consumption of broccoli increased by 28% when the vegetable was branded with a Sesame Street character.

Warner Bros

Ready Pac, a produce company signed a licensing agreement with Warner Bros.Ready Pac planned to feature Warner’s Bugs Bunny, Tweety and Tasmanian Devil characters on itsCool Cuts Ready Snax single-serving packages of fruit.

Warner Bros

The company also marketed carrots and celery served with ranch dip or peanut butter, which it described as a “healthier snack alternative” and “the original ‘kidpleasin’, ‘mom-lovin’ dippity delicious snack!”.

Disney and Kroger-The companies were committed toensuring that the Disney-branded products would fit

Disney’s emerging “good for you” nutritionguidelines. Together, they selected grocery categories that supported Disney’s efforts.

Pricing andbrand exclusivity were key to Disney’s

DTR strategy

Disney Magic Selections

“We wanted to use Disney’s storytelling and characters to help kids understand and internalize information—to communicate to kids in a fun, Disney way.” -Honeck,TeamLeader,DCP,grocery &drug business

In addition to DCP’s nutritionalefforts, the company made “nutritionally-beneficial

changes” to the meals served to childrenat all Disney-operated restaurants in its parks and

resorts.

“Disney will be providing healthier options for families that seek them , whether at our parks or through our broad array of licensed foods,”

- Robert Iger ,Disney President and CEO.

Disney had to face it too!!!

Risk & Challenges

1. Pricing And Value

DCP managers understood that its products had to be affordable.

“We’ve conditioned the market to expect premium pricing from Disney and this is a marketing challenge for us, to go out with lower pricing,” - Leslie.

“But for these products, affordable equals value, not price.” “We have to deliver quality to represent our brand well.” ------- Mooney, President, DCP

2.LegacyThough they were confident that the products would be healthful,child-friendly and fun, they had been subject to vocal criticism in the past and expected to encounter some skepticism as a result.

This was the time to leave back the legacy

DCP’s wanted to focus on its current “Better for You” strategy rather than its legacy.

3.Differntion & Competition

DCP wasn’t first to market with fresh produce and Nickelodeon packaged products had been on the shelves

DCP managers believed that the combination of a broad product line, wide distribution and the Disney brand would win over Moms.

4.Growth & DistributionOther than its DTR relationship with Kroger Disney wanted to license or develop additional lines.

DCP managers believed that the company could differentiate additional lines using characters, brand and price.

“We expect competition and channel friction but we believe we can beat the competition because even if they develop and match our nutritional standards , they cannot access the Disney magic.”

-Embola Ndi,VP, Product Development,DCP

Thank You

DISCLAIMERCreated by Shirsha Chakraborty, Institute of Engineering and Management Kolkata, During the marketing internship by Prof. Sameer Mathur, IIM Lucknow.