Disney Puts Interactive & Consumer Products Together

Disney Puts Interactive & Consumer Products Together
Picture from The Walt Disney Company / The Walt Disney Company Website
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In an effort to become more effective in reaching a market that is increasingly reliant on technology, The Walt Disney Company has decided to put together two of its divisions, Disney Consumer Products and Disney Interactive. According to their press statement, the merging of the said divisions will also result in the formation of a new combined segment known as Disney Consumer Products and Interactive Media (DCPI).


Furthermore, Tom Staggs, Chief Operating Officer of The Walt Disney Company, explains, “Both Disney Interactive and Disney Consumer Products have a strong track record of connecting people to their favorite stories and characters. As technology and digital entertainment continue to evolve, a shared innovation strategy will enable this new segment to create unique and engaging products and experiences that exceed consumers’ expectations.”

Meanwhile, the said new segment will be having two bosses as current president of Disney Consumer Products Leslie Ferraro and current president of Disney Interactive Jimmy Pitaro will reportedly be running DCPI together as co-chairs.

This merger comes as Disney Interactive’s 2nd quarter revenues for the fiscal year of 2015 goes down to $235 million. This is slightly lower than its $268 million 2nd quarter revenue during the fiscal year of 2014 as stated in their Quarterly Earnings report for the 2nd quarter of the 2015 fiscal year. This amounts to a decline of 12%.

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According to a report by the New York Times, Disney Interactive was met with a lot of challenges in the beginning, especially due to rapidly shifting preferences in the video game market. It had gotten so bad that in the past, an earlier New York Times report found that Disney Interactive had to let go of about 700 of its employees last year. Nonetheless, things had started turning around for the division, especially with its hit product, Disney Infinity. Moreover, Disney has also noted the significant success of its mobile game, Tsumu Tsumu.

Meanwhile, Disney Consumer Products performed more favorably during this fiscal year’s 2nd quarter with a revenue of $971 million, compared to its $885 million revenue during the same time last year. This amounted to a 10% 2nd quarter revenue increase.

There are actually several business under Disney Consumer Products including the Disney Store, Disney Licensing and Disney Publishing Worldwide, which publishes digital and print media including books, magazines and apps. Moreover, Disney has said that the reason for its increase in revenue during the 2nd quarter for fiscal 2015 was largely due to the stellar performance of its Frozen merchandise and partly due to The Avengers.

The New York Times reports that the newly formed division is expected to have an annual minimum revenue of $5.28 billion with an operating income of $1.47 billion. Meanwhile, The Walt Disney Company also expects to report the two business as one segment for financial reporting purposes at the start of fiscal year 2016. Furthermore, the LA Times also reports that there are no layoffs expected as a result of the creation of DCPI.