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Under the direction of CEO Bob Chapek, Disney’s approval has dropped from an impressive 77% to an embarrassing 33%. Why and what can be done to improve approval numbers?
Credit: Strive
Strive, an asset management company, has a few ideas. Recently they sent Disney a letter outlining their ideas for improvement. The number one priority in that letter? To improve guest satisfaction, Disney must stay out of politics. The asset management firm went on to say, “Today, Disney’s mission is “to entertain, inform and inspire people around the globe through the power of unparalleled storytelling, reflecting the iconic brands, creative minds and innovative technologies that make ours the world’s premier entertainment company.” It was once much shorter: “Make people happy.” And until recently, Disney has largely stayed true to both.” However, the firm believes Disney fails on both mission statements when they alienate part of their customer base due to political agenda. The letter issued Bob Chapek this task to evaluate: “what risk-reward calculus justifies taking controversial political positions that risk derailing Disney’s otherwise strong economic prospects by alienating a majority of your customer base?”
Credit: Disney
The letter also informed Disney that, “polling shows that while 29% of investors believe it is a “good thing” for companies to leverage their financial power for political or social means, twice as many – 58% – say it is not.” Meaning a majority of investors believe that business and politics should remain separate.
The letter further chastised Chapek for using his position as CEO to advance agenda rather than shareholders interests. Then Strive asked, “You vowed to “use our influence to . . . stand up for the rights of all” and “be an outspoken champion for the protection, visibility and opportunity you deserve.” After the bill was signed, Disney made good on these promises, issuing a new press release stating: “[o]ur goal as a company is for this law to be repealed by the legislature or struck down in the courts.”
As new Disney shareholders, we respectfully ask: Why was it Disney’s “goal” as a California headquartered entertainment company to repeal legislation in Florida and other states that had nothing to do with its products or operations? More specifically: why do you believe that these behaviors would increase value for Disney stockholders?”
Credit: Deadline
Going further Strive Pressed: ” 87% of people are either very or somewhat likely to “stop using a product or service of a company that advocates for a political agenda” that contradicts their beliefs. And, notably, these losses are not outweighed by additional purchases – or “buycotts” – by customers who agree.”
This last point has been proven true. Disney reported increased revenue from theme parks, but they have achieved this not from increased demand, but from increased prices. Meanwhile movies that sparked political controversy, such as Lightyear, failed to perform and failed to see an appreciable increase in consumption from those who supported the political messages.
Will Disney pay attention? Time will tell. Bob Chapek has said Disney has no place in pitics but fans have yet to see thst statement put into action.
