The Walt Disney Company was created by the Disney Brothers Walt Disney and Roy Disney as a small animation studio in 1923. It is now a global phenomenon with theme parks, streaming services, television networks, and movie studios. In 2024, Disney's total revenue amounted to $91 billion and employs over 233K people. The company's streaming operations alone produced $574 million in streaming profit and achieved profitability for the first time in 2024.

Disney spent billions in just 13 years buying companies that seemed to have nothing in common: 

• A computer animation studio
• A comic book publisher
• A space opera franchise
• A massive media conglomerate

Each purchase looked risky at the time. Critics questioned whether Mickey Mouse belonged in the same company as Iron Man and Darth Vader. But Disney's bold strategy follows Dr. Nadya Zhexembayeva's principles of strategic reinvention. The company built an entertainment empire by collecting the best storytellers and characters from every corner of popular culture.

The Crisis That Forced Disney to Think Differently

In the early 2000s, Disney was in “hot soup,” to say the least. Ticket sales were falling. New companies like Netflix were changing how people watched entertainment. Younger audiences were spending more time on phones and computers instead of watching Disney movies.

Disney's content was scattered across different companies. The company had sold distribution rights to other studios over the years. This meant Disney couldn't control how people accessed their most popular characters and stories.

Then Robert Iger became CEO in 2005 and recognized these warning signs. Instead of waiting for the problems to get worse, Disney started planning its response. The company would need to build new capabilities while keeping the things that made Disney great, like compelling stories and beloved characters.

Strategic Moves That Changed Everything

1. Buying the Best Creative Companies

Disney’s acquisition of the four major companies completely transformed the company’s business. Disney acquired Pixar in 2006 for $7.4 billion, Marvel in 2009 for $4 billion, Lucasfilm in 2012 for $4.05 billion, and 21st Century Fox in 2019 for $71.3 billion.

Each purchase gave Disney something it couldn't build on its own. Pixar brought computer animation expertise when Disney's own animation was struggling. Marvel provided superhero stories that appealed to adult audiences. Lucasfilm came with Star Wars, one of the most valuable entertainment properties ever created. The Fox purchase added thousands of movies and TV shows to Disney's library.

Disney kept the creative teams that made these companies successful. John Lasseter stayed in charge at Pixar. Marvel Studios continued making movies the same way. George Lucas remained involved with Star Wars as a consultant.

2. Building a Direct Connection with Customers

In November 2019, Disney jumped right into the streaming wars with Disney+. The service is home to all content from Disney, Pixar, Marvel, Star Wars, and National Geographic. By 2024, Disney+ amassed 153.8 million subscribers around the world. Disney’s “The Mandalorian” and “WandaVision” became the social talk of the town when they aired.

Disney also bundled services together. Customers could get Disney+, Hulu, and ESPN+ for one price. As a result, it became more difficult for users to cancel since they would quit multiple services at once.

3. Making Theme Parks Smarter

Disney invested billions in updating its theme parks with new technology. The MyMagic+ system let visitors use wristbands to enter rides, buy food, and unlock hotel rooms. Mobile apps showed wait times and let people reserve spots in line.

New attractions connected to Disney's acquired properties appeared in parks worldwide. The construction of Star Wars: Galaxy's Edge at Disneyland and Disney World was a costly venture of over $1 billion. Marvel superheroes were brought to Disney California Adventure.

These improvements served two purposes:

1. Higher prices were justifiable because they made it easier for customers to visit Disney parks.
2. They also developed new methods to collect data on what most interests guests, enabling Disney to provide a more personalized experience. 

Organizational Changes Inside Disney

Bob Iger changed how Disney operated internally. Before his leadership, different Disney divisions rarely worked together. Animation, theme parks, and merchandise operated like separate companies.

Iger established new frameworks that compelled divisions to collaborate. Disney didn't incorporate Marvel characters in films after acquiring Marvel. People saw them in theme park rides, toys, video games, and clothes. Disney got the most value from each character or story using this approach.

The company also shifted its culture around risk-taking. Disney had become conservative about trying new ideas. Iger told the teams to try different kinds of content, even if some failed. It led to successes such as “Black Panther” and “The Mandalorian.”

Results That Speak for Themselves

Disney's reinvention strategy provided measurable benefits in all areas:

• Financial performance improved significantly. Disney's streaming business made an operating profit of $574 million in 2024. The company's revenue for the third quarter of 2024 reached $91 billion, beating analyst estimates.
• The acquisitions paid off at the box office. Disney acquired several properties that generated over $5.46 billion in box office sales worldwide. Moreover, this total excludes merchandise sales and theme park revenues. “Avengers: Endgame” became the highest-grossing film of all time.
• Brand strength increased across all age groups. Disney continues to appeal not only to kids but also to grown-ups thanks to Marvel and Star Wars. The company always ranks as one of the world’s most valuable brands.

5 Lessons from Disney's Reinvention

1. Use external talents through acquisition when internal development takes too long. Disney recognized it couldn't develop computer animation, superhero stories, and streaming technology fast enough to compete. Acquiring established leaders gave Disney immediate expertise.
2. Keep successful teams intact after acquisitions. Many companies destroy what they buy by forcing changes too quickly. Disney preserved the creative cultures that made Pixar, Marvel, and Lucasfilm successful.
3. Create connections between different business units. Disney maximizes value by using the same characters and stories across movies, parks, merchandise, and streaming. This cross-platform approach increases profits from each piece of content.
4. Invest in direct customer relationships. Disney+ gives the company control over how people access its content. This reduces dependence on other companies and provides valuable data about viewer preferences.
5. Act before a crisis forces your hand. Disney started building streaming capabilities and acquiring content libraries years before traditional media revenues collapsed. Early action provided more options and better deals.

Disney's Reinvention at a Glance

Insights from Dr. Nadya Zhexembayeva about Disney

Dr. Zhexembayeva instructs that to properly reinvent itself, a company must learn, not just unlearn. Disney demonstrates this principle perfectly. The company stopped thinking of itself as an animation studio and started thinking of itself as an entertainment ecosystem.

Disney’s example shows that legacy businesses can and should reinvent proactively. Rather than waiting for streaming to destroy their business, Disney decided to be proactive and build Disney+ while still profiting off traditional methods. This allowed Disney to grow and adapt without any looming crisis.

The company is continuously reinventing itself as opposed to only doing it once. As technology and customer preferences change, so does Disney’s strategy According to the Disney outlook, whatever ensues, they will remain relevant.