Marvel Movies Restructuring – A discussion

1)     Summary sheet

Situational Analysis:  Marvel enterprises Inc, an American based firm that is known for publishing comic books and providing character based entertainment. According to resource for case solutions found here, the company was founded in 1988. The company has gone through many phases.. Marvel enterprises Inc foundation is built on their huge library of 4,700 characters featured in a variety of media for almost seventy years. This is a great success of the company. Marvel enterprises Inc publish comic books, sell toys, produces films. Their decision to utilize their character franchises in licensing agreement and the publication of comic books through the division of Marvel comics added to the company’s popularity. in past three years the company has succeeded to lent its characters to eight movies namely, Spiderman, Sony Pictures, The punisher, etc. the toy segment of the company sells toys based on licensed characters similarly the film production section of the company produces and distributes films across the Globe.

The main theme of the comic books revolves around the superheroes of the company namely, Spiderman and The fantastic four but there are other newly developed characters too. The comic books they published come in two formats including, periodical and graphic novels. Periodical comic books are like small magazines consist of 30 pages. Graphic novels on the other hand, capture a whole story and consist of almost 130 pages. The customers of the comic books are mainly the male part of the society from 13 to 23 years old. There are two types of the customers’ one who take the comic books as any other books or magazine. The other type of customers takes the comic books as a collection. The company always encourages the feedback of its customers. The distribution of Marvel comic books is done through three channels.1) to comic book speciality stores 2) to traditional retail outlets 3) on subscription sales basis.

The toys of the company are equally popular across the world. The target market of the toys is little children from 4 to 12 years of age. The main competitors of Marvel Bandai, Hasbro and Mattel. The licensing segment of the company licensed Marvel characters to variety of media including, television programs, featured films, video games and theme park etc. the company recently has opened its offices in Tokyo and London in order to increasing its licensing activities in other countries too. Marvel enterprises Inc have expanded its business by broadcast media. Selling of toys, comic books and other products have added to the company’s popularity. Spiderman is the character who gained worldwide popularity but other characters like Fantastic four and X man has also contributed a lot to the company’s popularity.

The problem statement: Success is not easy to achieve but it is far difficult to maintain. Same is the case with the Marvel enterprises Inc. the company faced two sets of questions that were critical to its future. It was a big question for the company that would it be able to sustain its success in future too or would the world characterize this success as a fluke? The major success of the company was dependent on a very few blockbuster characters like Spiderman. It was a big question for the company that they keep on relying on the limited characters or was it the time to seek growth in a larger set of lesser known characters. The other thing that was important to consider was, how to explore business growth opportunities. Now it was the time to decide that what business strategy the company will have to adopt in order to ensure company’s growth and prosperity. it was the time to move in to more capital intensive activities.

Decision statement:It is the time to hire new executives and CEO for the company.It is essential to make different strategies that can add to the prosperity and growth of the company.  The aim of strategy making should be  monetizing the content library through licensing characters for use with motion pictures, television and video games and also with consumer products like toys, food and apparel. It should be planned that each of such activities will reinforce each other like by watching a movie the kids will love buying the toys as well, this might push them to wear their TT shirts too and this might compel them to buy other consumer products of the company. The other major point to focus on should be managing the library of characters to foster long term value. Many children had heard about the names of characters like fantastic four but watching them in picture movies will surely be a great thing. Giving life to the characters should be  another major thing to consider. The third important thing to be considered is that how to emphasise high level of consistency in characters and stories.  The company should hire the top writers from both from the film and open market to write comic books for them and signed contracts with them. So that the creativity would be enhanced and quality of books can be made better. This strategy would prove really beneficial for the company. The company should make many divisions like, comic book publishing, licensing and toys.

2)     Recommendation sheet:

 

  • Consider merging with other companies: It is necessary for the company to consider merging with other companies like Disney. This way Marvel can increase the library of characters and can attract more viewers toward the company.  Merger of two companies means the merger of ideas too. fusion of ideas will ultimately adds to the popularity of the company
  • New agreements should be made: Marvel enterprises Inc should expand video games licensing by doing agreements with Take two interactive and electronic arts etc. the young blood across the world is very much in to video games. the innovative ideas can be introduced and can be beautifully presented through the famous characters. This way the company popularity will dramatically rise.
  • To introduce lesser famous heroes in most popular heroes’ movies: There are a few numbers of characters which have gained worldwide popularity like Spiderman. There are many characters too which have been waiting since long to get attention of the viewers. It is important for the company that instead of relying fully on the limited characters, pay some attention to other characters too. Introduce them in the movies of Spiderman so that children can get to know about them too.
  • Creation of new characters should be done via publications: New characters should be created and must be promoted via publications. Innovation and creativity is the key of success. New characters should be wisely introduced. Marketing should be done in a way that children start loving them before watching them on TV. Effective marketing is very important thing. Good market strategies can add a lot to the popularity of the product and vice versa. only those entertainment companies can survive that comes up with the new ideas and adopt effective promotional strategies. Marvel enterprises Inc should put emphasis on both of the things.
  • Company should develop e- comics:Today we are breathing in the world of Information technology. Instead of going to a book shop to buy a book we just turn on our computers and read what we want to read. So it is very important for the company to develop more and more e comics so that most of the children can read them easily. Comics should be easily accessible to the children. development of e comics will surely add to the popularity of the company
  • The company should develop toy production capability:Toy production is an important asset of the company. to sustain the success the company should develop toy production capability. Toys should be developing according to the choice and mind of the children. Time to time market surveys and customer’s fee back can play an important role in raising the quality of toys better.
  • Improve the marketing strategies: The company should improve the marketing strategies. The company is handling multiple tasks like toys production, licensing characters, movie making, comics and other consumer products. It is very important for Marvel enterprises Inc to develop such marketing strategies that cover all these areas effectively and efficiently. a good marketing strategy can lead the product to the zenith of success and a bad marketing strategy can tarnish the beauty of the product fully.
  • The company should hunt for new talent:The production of the company can be made better by hiring new talent for the company. New writers from all over the world should be hired. as company has already done in the past. This practice should be continuing in present also. The writers from movie industry, local market and related fields should be hired so that the quality of the comics and movies should be maintained.
  • Company should make high margins in competitive markets by licensing:Licensing is the strategy that can help the company to make high margins in competitive markets.
  • Quality of brands should be improved:Customers often compliant for the weak and damaged brands. The company should never compromise on the quality of the brand. A brand represents a company. It should be made flawless and no compromise should be done on its quality. a brand helps maintain a relationship between a customer and the company. The quality of its brands should be improved by the company.
  • Bidding with already established entities: The company should consider bidding for toys, comic books and other consumer’s products for already established entities like TCM, Star wars etc.
  • Company should produce user friendly websites: The company should produce such websites that should be user friendly, easy to operate and attractive. Colourful, musical and tricky websites are always liked by the children. A user friendly website can also help attracting customers toward the company’s brands.
  • Technological growth should be done:Only those companies can survive that comes up with new technological ideas. New technologies should be introduced in toy making specially.  Children love buying the toys which they have seen on TV or in shape of a cartoon character. They should be designed wisely by using latest technologies.
  • The toy market should be highly competitive and driven by volume: Marvel should make high margins in competitive market by licensing.  The percentage of Marvel sale vs. industry is 19%.
  • Movies should be purposeful: The purpose of the movies should be introducing the audience with Marvel universe and to let them discover the potential of Marvel superheroes like Spiderman. The movie should be purposeful and should be made wisely. This will take the company to the zenith of success.

 

LIST OF ALTERNATIVES:

 

The following alternatives can be used by the company

 

  • Marvel comics can be used as an alternatives of classic board games like X Men monopoly
  • Less popular characters can be used as an alternative to super heroes like Spiderman
  • Real life characters can be introduced to make the existing characters more powerful
  • More emphasis should be given on e comics. these can be used as an alternative of traditional comics.

SWOT Analysis of Marvel enterprises Inc:

The purpose of SWOT analysis is to see what are the strengths and weaknesses inside the organization and what opportunities and threats the company might face outside the organization.

Strengths

  • Marvel is the world top comic seller
  • Strong brand equity is another strength of the company
  • A character like Spiderman is popular among both young and old.
  • The financial position of the company is its strength
  • Cost advantage
  • Film production and distribution
  • Range of toys the company offers to the kids of all groups.
  • Good distribution network and good consumer relations
  • Diversification in strategies
  • They try to bring in new readers by refreshing famous characters

 

Weaknesses

  • Poor supply chain
  • Customer’s complaints about damaged, weak brands
  • Weakness in management team is another weakness of the company
  • Limited market of comic
  • Low market share is another weakness the company face
  • It targets only one market segment
  • Poor marketing strategies
  • Lack of marketing is another weakness of the company

 

Opportunities

  • Innovative and creative ideas
  • Expansion of product and customer services
  • It raise money through debts
  • The possibilities of diversification
  • Online customer services
  • The long term licensing agreements
  • Technological growth is an opportunity for the company

 

Threats

  • Market competition
  • Competitors offering lower costs
  • Few famous characters on which the company is relying fully
  • Economic slowdown
  • Threats of new entrants
  • Price wars among different companies
  • Limited market segment to target
  • Ownership and copyright
  • e-comic theft is becoming threat for the company

 

TOWS Analysis:

A TOWs Matrix is basically used for putting a SWOT analysis into action, which means that whatever analysis we made in a SWOT analysis, meaningful strategies are formulated on its basis.

TOWs Matrix For Marvel
  Strengths Weaknesses
Opportunities SO Strategies WO Strategies
  • They should come up with some new character. To catch more audience toward he company
  • Online customer services should be promoted for more character recognition

 

  • Technological growth should be improved so that brand qualities can be made better
  • The company should target all market segments. They should not limit themselves to a particular age group or gender.
Threats TS Strategies TW Strategies
  • Good distribution network and good consumer relations can be helpful for the company to win market competition
  • Instead of relying on few characters the company should introduce new characters
  • Lack of marketing can be improved by making new strategies and promoting e characters and  comics
 

 

Marvel enterprises Inc Porter’s 5 forces

Porter’s 5 forces are applicable to the entertainment industry too. It can effect in the following ways:

  • Threat of new entrants:  There is always a possibility of new entrants in any industry especially the entertainment industry. it is the duty of the producers and manufacturers of Marvel enterprises, Inc create such products that keep the interest of customer’s in that particular product or character alive.  The company needs to create such strategies and add new technologies that new entrants do not find much space to show their capabilities fully.
  • Bargaining power of suppliers: There is a kind of competition among the suppliers. only those suppliers can survive in the entertainment industry that come up with the latest technologies. Survival of the fittest is the only policy in the world of entertainment.
  • Rivalry among existing industry firms:  As it has discussed earlier that the best strategy to compete the existing rivals of the industry is to provide such products and services to the customers that are equal or partially equal to the big names of the industry. An utmost effort should be made by Marvel enterprises to create better entrainment stuff and maintain its unique quality of differentiation.
  • Bargaining power of buyers:  Buyers have the liberty to like or dislike a particular company. Their past experience help them a lot to decide whether they want to deal with the company or not. Buyer satisfaction ultimately leads to the popularity of the entertainment company. The customers today have a better bargaining power due to a wide choice available in the world of entertainment. The Marvel Enterprises should take the bargaining power of customers as a serious concern for a sustainable survival in future.

 

  • Threat of substitute products: The threats of substitute products are much higher in entertainment industry as compared to any other industry. The rival companies may come up with a  new character which may increase the market share of these competing companies. When customers have more choice of products than it is difficult for a company to sustain its success. It is the time to make full use of innovation and creativity.
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