is focused on telling stories in “a more customized, more personalized way” and “bringing together the physicality plus the media element of Disney,” chief executive
Speaking at The Wall Street Journal’s Tech Live conference, Mr. Chapek said the entertainment company is working on ways to unite its two main business lines—its parks, experiences and products division and its media, content and streaming division—using the Disney+ app. The idea, he said, is to steer content to customers based on what theme park rides a visitor prefers, for example, rather than trying to predict what a customer will like based on past viewing or personal information.
Recommendations based on customers’ demographic characteristics often “are a complete record scratch because it is nothing like what you watch,” Mr. Chapek said. Once the company unites data collection capabilities between its various divisions, “we can give you a better experience in the park, because we know what your preferences are in terms of viewing and a better experience on Disney+ because we know what your affinities are,” he said.
Mr. Chapek said he believes that in the future there will be fewer streaming services than there are today, but spoke as well about the challenge of setting the right pace for adding new content to Disney’s streaming platforms, which include not only Disney+ but also Hulu and ESPN+. He said the right cadence of offerings satisfies viewers but doesn’t overwhelm them.
The Covid-19 pandemic delayed many productions and led to a build up of content in Disney’s pipeline, Mr. Chapek said, but “finally the dam broke and now all that content is rushing out.” This gives the company the opportunity to more thoughtfully plan out how to distribute movies and TV series across its various platforms without worrying about not having enough to show, he said.
Over the last three years, Disney has moved aggressively to expand its menu of general entertainment offerings, including more adult-oriented shows such as “Pam & Tommy” and “The Kardashians” on Hulu, which Mr. Chapek said are an important part of providing options for fans of all ages.
He said that after more than 30 years at the company, he is still surprised by how much “elasticity” the Disney brand has, and said concerns about what’s appropriate to show on a Disney-owned streaming service are probably overstated.
“I want to respect what this brand is. But at the same time, I know that we may be even more precious about what is ‘Disney’ than the consumer base is,” Mr. Chapek said. “If the consumer base has more elasticity, we probably ought to listen to our audience, which means we have more degrees of freedom than we probably thought.”
Mr. Chapek also highlighted Disney’s investments in what he described as “centers of creative excellence” around the globe that develop local-language content in countries such as India.
ESPN continues to be a crucial part of Disney’s business, Mr. Chapek said, as consumers demand a more interactive live sports experience. An activist investor recently called on Disney to spin off the ESPN network, but later backed off after the company explained the brand’s importance.
Whether the ESPN brand incorporates sports-betting in the future will be up to the consumer, according to Mr. Chapek. “We are looking at all different options on how we can deliver on that consumer expectation of a lean-forward sports experience,” he said.
Disney’s parks division has recently made a fresh round of price increases, which, on top of changes at the theme parks since the pandemic meant to generate more income from fewer visitors, have led to tension with longtime Disney fans.
Mr. Chapek said the changes, including higher prices, pricey add-ons to the Disney parks app and an online reservation system that limits crowd size at the parks, are necessary to guarantee a good guest experience in a world where the company can’t control demand and doesn’t want to turn away visitors who have traveled across the country for a family vacation.
“We can have pricing be a reflection of how many people we can actually let in,” he said. “For some of our fans, that is heresy. But it’s not only good business practice in terms of maximizing shareholder value, but it protects the guest experience.”
The CEO also addressed the fallout from a March controversy over the Parental Rights in Education bill, a state law in Florida that limits what sex-education subjects can be taught to elementary-school students. Mr. Chapek faced criticism from a group of Disney employees as well as human-rights activists over the company’s slowness to condemn the bill, which they viewed as anti-LGBT.
What theme park visitors remember more than anything is interactions with park employees, which Disney calls “cast members,” Mr. Chapek said. “So if that is the key to a great guest experience, and we are all about the guest and the audience maximizing their experience, then you have to make sure that the cast is at the center of everything that you do,” he said.
When faced with a tough situation like the one in Florida, Mr. Chapek said it is important to stick to the company’s core values.
“Certainly, we all want to make everybody happy all the time. I’m not sure that is possible in this world,” he said. “What is important is how people think about our company. I take myself out of it and I think that is sort of the surprise….I wash all that away and say, what do we want the capital-D Disney company to stand for?”
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Asked what advice he would give to another CEO facing a similar situation to the one Disney confronted in Florida, Mr. Chapek said he would tell them, “Stick to your values. Stick to your north star. Simplify the cacophony of voices out there, and do what you think is right.”
Amid the Florida controversy, some fans, advocacy organizations and elected officials sharpened public criticisms of Disney and its content, particularly movies and series that highlight LGBT relationships and examine gender issues. Critics escalated rhetoric around Disney’s supposed “wokeness” this summer after the release of the animated movie “Lightyear,” which features a same-sex kiss and was banned in countries across the Middle East and North Africa.
Asked if Disney has become “too woke,” Mr. Chapek said that he believes it is the company’s job to cater to fans who love the Disney brand.
“I think Disney is a company that has survived over a hundred years by catering to its audience and it’s going to thrive the next 100 years by catering to its audience,” he said.
Write to Robbie Whelan at [email protected]
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