Disney Looks To Put Spotlight On Future As Its Kingdom Grows

Last year Disney’s (NYSE:DIS) big marquee event to celebrate its streaming service came just days after, what was viewed as, a less-than-favorable earnings report was presented to investors.

Paired with Netflix’s (NFLX) own worrisome reporting and a general sense of industry doom and gloom, the previous edition of Disney+ Day was seen by some critics as a potential last gasp of a fading trend. The negativity sent the market into a tailspin and the validity of the model was heavily questioned.

Nearly a year later, it’s clear rumors of streaming’s demise were greatly exaggerated. Yes, the concern around Netflix proved to be well warranted, but Disney on the other hand… well, the Mouse is riding high, and its team is about to roll out all the stops to ensure it stays on top.

So how does it plan to do that?

First, as always, some background.

This year’s Disney+ Day got off to a good start early because it’s being held as part of a celebration vs. a way to stay afloat. It also has the added benefit of coming just a day prior to Disney’s “D23 Expo” which occurs every other year.

Simply put – get ready for a glut of news about future projects and a big drop of new content to start streaming. And keep in mind, this is coming just about a month after Disney came to San Diego Comic-Con and did something similar.

The message to investors is simple – you want content, we have content and a variety of ways to bring it to you. Disney’s pipeline is deeper than most studios, and the company has multiple places to pull from in determining its schedule. It’s a competitive advantage few other studios have at this type of level.

Let’s also be clear, though, what makes Disney strong is not just that it has content, but that last part about knowing how to distribute it. This goes beyond hybrid releases, day-and-date offerings and streaming exclusives but to the core of the mechanism itself.

As we’ve seen – for better for worse – streaming success is measured by subscriber count. It’s a flawed metric but, thanks to Netflix, it’s the commonly accepted barometer. What that means is that Disney+ gets more attention than it necessarily needs, but given its continued success, you can see the reasoning.

Hence, why that earnings report I mentioned prior wasn’t well received.

Yet, as was the case then as well, Disney knows it can and should leverage the other areas of its business to boost and balance out its priorities – which is why every aspect of the company ties into the service in some way.

Disney+ day has connections across the board – early park admission, deals on merch, special screenings with giveaways, etc. The idea is to show how Disney is the full package. They even got AMC on board to work with them on a promotion, even AFTER the screen-to-stream strategy and its backlash.

This also means giving subscribers new options to sign-up.

One such new approach is an ad-tier option for Disney+ that also will open up a new revenue stream.

Unlike Netflix, this wasn’t a reactionary move, and it had been in the works for a while. Disney’s team saw early on the added value, and given it owns the majority of its content, it won’t hit a number of the landmines that Netflix has had to work around.

By coming at the approach from a point of strength and understanding the inherent benefits of the added subscriber option, Disney again is able to keep pace with the industry. It’s that type of foresight that has always fueled the House of Mouse.

So with that said, you can see why the idea of creating some type of membership program also is being discussed. What Disney wants to ultimately do is mimic what Amazon does, where its streaming service is a value-added option of its yearly subscription rate and part of a larger group of offerings.

Paramount and Walmart just did something similar, where they will begin pooling resources shortly to reach more consumers. Walmart’s an interesting player in this space as between this deal and the one with Roku (ROKU) it’s ramping up its presence in a creative way that doesn’t involve making its own shows (for now).

But how would something like this work for Disney? That’s still up in the air and early days in the approach, but suffice it to say Disney could get creative with some type of cross-over deals between its parks, merchandise and various networks.

And that’s also the point of D23.

The expo is designed to show off all aspects of Disney every two years to give off that full picture. It also seems like an educated guess that Disney+ will come up a lot in conversation.

It’s clear Disney is getting behind streaming in every way imaginable as it sees that as the vehicle to help them meet that 2024 date to be “profitable” or at least its version of “profitable”.

This week’s Disney+ day and D23 expo are further proof of that approach, and one you’ll likely hear more about before the year is over.