The aftershocks of COVID 19 may prove to be worse than the initial attack. Understanding the pandemic is not only a question of science but of business as well.
The impact of the virus on 97 year-old media and entertainment giant Disney Co. was divestating and their transition to a digital-first strategy just as transformative.
Last week, Disney announced a major restructuring, as it drastically reduced its focus from theme parks, cruises, movies, and cable TV to Disney +, its streaming service. In a statement, Bob Chapek, Disney's new CEO, said "Given the incredible success of Disney+ and our plans to accelerate our direct-to-consumer business, we are strategically re-positioning our company."
Disney+, launched last year, has been a huge success with over 60 million subscribers. On the flip-side, COVID 19 destroyed Disney's cruise, theme park, cable TV, live-sports, cinema, and retail businesses - losing $4.7billion in second quarter.
A Very Bold & Quick Pivot
For a company of its size and culture, Disney's pivot to digital was astounding. Pre-pandemic, Disney held the top-spot in global entertainment so deciding to reinvent itself around a digital strategy is very telling and points to management's belief that the virus's impact will be longer and deeper than once thought. Making the 'wait-it-out' option a non-starter.
The shifting to digital is not specific to companies like Disney. Re-positioning your business model and brand to accommodate access to customers in a more economical and direct way is vital.