Consumers, Firms and markets
Final Report
ENTERTAINMENT & MEDIA
SUBMITTED BY: GROUP 1 Section- D
NAME ROLL NO
ABHISHEK JAIN 201822049
CHITRANSHI KAHNDELWAL 201822057
GARIMA SINGHAL 201822059
HIMANSHU GUPTA 201822061
KEVAL GALA 201822067
Company name- Marvel Entertainment
Marvel Entertainment, LLC is an American entertainment company founded in June 1998 and
based in New York City, formed by the merger of Marvel Entertainment Group, Inc. and Toy
Biz. The company is a wholly owned subsidiary of The Walt Disney Company, and is mainly
known for its Marvel Comics, Marvel Animation, and Marvel Television units.
In 2009, The Walt Disney Company acquired Marvel Entertainment for US$4 billion; it has been
a limited liability company (LLC) since then.
The company’s headquarter is in New York City.
Background:
Marvel Entertainment is a wholly owned subsidiary of The Walt Disney Company. It is a
character based entertainment company that owns a proprietary library of over 8,000 characters.
Marvel is primarily involved in the entertainment, licensing, publishing, and toy and film
production industry. The company operates in both domestic and international markets, but their
main focus is in the United States. Marvel’s headquarters is in New York, New York. Some of
Marvel’s best-known characters include Spider-Man, Iron Man, Red Hulk, Captain America,
Thor, Ghost Rider, Squirrel Girl, Misty Knight, Hercules, The Hood, and Daredevil. Marvel
produces comic books, digital comics, motion comics and mobile comics based on these titles
and various others. Since 2008, Marvel has become involved in the film industry producing such
films as The Amazing Spider-Man, Marvel's The Avengers, Captain America: The First
Avenger, Thor: The Dark World, Guardians of the Galaxy, Ant-Man, Iron Man 2, Planet Hulk,
X-Men Origins: Wolverine, Hulk vs. Wolverine, Punisher: War Zone, The Incredible Hulk, Iron
Man and Fantastic Four: Rise of the Silver Surfer, and others. Marvel also develops a line of
online video games which include such titles as: Dead pool, Marvel Heroes, Avengers: Battle of
Earth, The Amazing Spider-Man, Iron Man 2: Upgraded!, Planet Hulk Gladiators, Super Hero
Squad: Fractal Frenzy, Thor Takes Flight, Iron Man Flight Test, Black Widow, X-Men Arcade,
Thor: Bring the Thunder, and Wolverine Search & Destroy, and others. They have also
developed a wide range of mobile apps, social, console, and online games. Marvel’s television
programs include The Avengers: Earth's Mightiest Heroes, The Super Hero Squad Show, and
Iron Man Armoured Adventures. Marvel is also engaged in online retailing clothes, accessories,
toys, home decor, collectibles, and other entertainment and personalized items based on its
characters.
Mission and future vision of the firm:
Diversified genres of our legends and storylines allow Marvel to evolve with the generations of
today and those to come. Our foundation of originality, imagination, and innovation will be
guided by trends supported from our Marvel Universe enthusiasts.
Strategic Vision:
1. Generating the best creative content possible
2. Fostering innovation and utilizing the latest technology
3. Expanding into new markets around the world.
Various product lines:
Marvel Entertainment:
1. 1998 - Blade 7. 2006- X-men: The last stand
8. 2007- Ghost rider,
2. 2000- X-men
Spider man 3,
3. 2002- Blade 2, Fantastic four: rise of the
Spider man silver surfer
9. 2008 - Punisher: war zone
4. 2003- Daredevil 10. 2009 - X-men origins: wolverine
Hulk 11. 2011- X-men: first class
5. 2004- The punisher,
Spiderman 2, 12. 2012- Ghost rider: spirit of vengeance,
The amazing spider man
Blade: Trinity 13. 2013- The wolverine
6. 2005- Elektra, 14. 2014- X-men days of future past
Man-Thing, 15. 2015-Fantastic four
16. 2016- Dead pool, X-man apocalypse
Fantastic Four 17. 2017-Logan
18. 2018- Dead pool 2
Problem Statement:
Solution:
What strategy Marvel used to increase the demand?
Marvel comics used the current scenarios and issues of societies to create or form their
characters so that the viewers or the readers could relate more with the characters for e.g.: during
the time of world war II, They introduced the character captain America because there were
crisis in America and they needed a hero for support. After the end of the war the character of
captain America changed from the war hero to a peace maker. Similarly, as the moment of
women empowerment grew in the society marvel comics and marvel entertainment introduced
various female characters into their comics and movies.
Demand:
The overall market segmentation strategy is to target ethnically diverse males and females. They
are between the ages of 18 and 24 years old and, (as shown in Table 1), make up for the largest
age segments of comic book readers within the US. In addition, of the 11,400,000 plus Face
book Marvel Comics Fans in the United States, 45.48% are between the ages of 18 and 25 years
old (see Table 2).
Those in this age group are currently attending college or are recent college graduates and use
their average household income of $50,000 or more to purchase items for their interests and
hobbies. When making movie ticket purchases, for example, they buy either at ticket counter or
online. These males and females primarily live on the East and West Coasts. States such as North
Carolina, Maryland, New York, California, Oregon, and Washington are prime states of interest.
To increase the female fan following as well as to cater the demand of the society and social
environment, marvel studios and marvel entertainment have introduced various female
superheroes such as black widow, Wanda maximoff, Gamora, Nebula etc., which led to the
increase in the demand and craze for marvel comics and movies.
Table 1: "Demo-Graphics: Comic Fandom on Face book" Schenker, 2014
Table 2: "Demo-Graphics: The State of Marvel Comics" Schenker, 2014
Non pricing factor affecting the demand:
1. Population: marvels not only catered the American market but went global; hence
increase in the population of customer base. Eventually leading to increase in demand.
2. Income: depending upon different economic condition of the countries marvel cinematic
prized their products accordingly e.g.: in America ticket were sold at $15.45 (approx1100
rupees) whereas in India it was on an average 250 rupees.
3. Competition (substitutes): Marvel, founded in 1939, is the follower of DC Comics,
which was founded in 1934. DC Comics, being the pioneer for 5 years without any direct
competition prior to Marvel being founded, gained substantial market share and
profitability from the lack of competition. In 1939 when Marvel was founded and started
unleashing their comics to battle it out with DC Comics, Marvel showed that it had
gained the true advantage by following DC Comics. Marvel is the number one seller and
producer of comic books, and to this day continuously beats out rival and pioneer DC
Comics. Some of the most successful Marvel heroes of all time include Spiderman, X-
Men, and The Avengers. Without any direct competition from DC Comics for Spider-
man, the comic took off and has become the most collectable, valuable, and desired
comic and action figure of all time.
The X-Men and Avengers are similar in style to Justice League or Global Guardians. All
of the listed groups are comprised of superhero teams that battle to fight for good. The
leagues and groups of superheroes, as successful as they have been for both DC Comics
and Marvel, have not pulled in the large name, the credibility, the profits, and recognition
that Spiderman alone has been able to accomplish and provide for Marvel.
Supply:
Problem: Marvel’s have done a decent job in raising a sufficient demand in the market,
now the question is their plan to accomplish or fulfil the demand generated.
To overcome the problem mentioned above Marvel Company used various strategies to
enhance the supply. On an average marvel releases 2-3 movies per year.
Solution: during the very beginning of the marvel company they started with only
publishing comics, since they were able to generate the interest, consumers were willing
to pay more. Hence the price increased; with an increase in the price supply also
increased (Law of ceteris paribus). Eventually they went into producing movies. They
started with releasing one movie in every 2 years. Further with more increase in the
pricing they further increased the supply to 1 movie per year and the current scenario is
2-3 movies per year.
Non-pricing factor affecting supply:
1. Technology: with the development in the technology company shifted from comics to
movie as well as added more and more special effects and super natural characters in
their movies, which eventually led to ease in production of movies and new characters.
Therefore supply increases.
2. Resource prices: The major resources of the company are the actors and actresses
performing the roles. Although with the flow of the time the fee charged by the actors
and actresses increased which should have led to the decrease in the supply of the number
of the movies per year , yet this did not happen due to the other non- pricing factor
effecting positively.
3. Expectations of producers: The Company was able to meet the expectations of the
audience which eventually led to the fulfilment of the expectation of the producers and
every movie the company produce was able to generate sufficient profit. Hence the
expectations of the producers met and they increased their supply from 1 movie in every
2-3 years to 2-3 movies every year.
4. Prices of other goods the firm could produce: with the interest of consumers shifting
from comics and animations to digital media example: Amazon prime, Netflix etc. The
company increased the supply of the movies and TV series compared to producing more
of comics and animations.
EQUILIBRIUM:
S.W.O.T. Analysis:
Strengths:
• Support from the Walt Disney co.
• 8000 character library.
• One major competitor (DC).
• Established global presence.
• Communication with followers.
• Brand loyalist.
• High movie turnover rate.
Weaknesses:
• High movie turnover rate leads to predictability of storylines.
• Portfolio mostly limited to “super heroes”.
• Too-complex-to-follow plots.
• Characters are not completely relatable (live within a fantasy world).
• Viewed as comics only company.
Opportunities:
• Utilizing lesser known characters.
• Utilizing lesser known characters.
• Diversifying superhero and villain portfolios.
• Reaching out to female comic book readers.
• Events and conventions receive high traffic.
• Partnerships with relationships already established by Disney.
Threats:
• DC movies enter market around the same time as Marvel movies.
• Fellowship and loyalists in video game industry.
• Independent comics are gaining followers.
• Diminishment of print publishing.
• CW Network primarily working with DC.
• E-Comics theft.
Porter’s five forces:
Porter recognized that organizations likely keep a close watch on their rivals, but he encouraged
them to look beyond the actions of their competitors and examine what other factors could
impact the business environment. He identified five forces that make up the competitive
environment, and which can erode your profitability. These are:
(1) Competitive Rivalry: This looks at the number and strength of your competitors. How
many rivals do you have? Who are they, and how does the quality of their products and
services compare with yours?
Analysis:
Marvel Company has only one major competition that is DC. Their products are not that
effective in capturing the market they are more focused on the dark world and the serious
movies whereas marvel’s work in comedy, sensational, thriller, action.
(2) Supplier Power: This is determined by how easy it is for your suppliers to increase their
prices. How many potential suppliers do you have? How unique is the product or service
that they provide, and how expensive would it be to switch from one supplier to another?
Analysis:
There are no actual suppliers for this industry but their output depends upon the
availability of actors and actresses as well as sponsors. Although it is not easy to acquire
sponsors yet marvel has done a decent job.
(3) Buyer Power. Here, you ask yourself how easy it is for buyers to drive your prices down.
How many buyers are there, and how big are their orders? How much would it cost them
to switch from your products and services to those of a rival? Are your buyers strong
enough to dictate terms to you?
Analysis:
It is very easy for the buyers to drive the market prices as the entire market depends upon
the number of people watching the movies. It would take nothing for the buyers to switch
from their products and services to rivals. It is a complete buyer driven market.
(4) Threat of Substitution: This refers to the likelihood of your customers finding a
different way of doing what you do.
Analysis:
They found a different way by launching various women characters in their movies
which helped them to acquire a new level in the market.
(5) Threat of New Entry: Your position can be affected by people's ability to enter your
market. So, think about how easily this could be done. How easy is it to get a foothold in
your industry or market? How much would it cost, and how tightly is your sector
regulated?
Analysis:
There is least threat from new entries because the entry barrier in this industry is very
high because it requires a lot of fund or initial capital to start a company in this industry
as well as Marvel and DC’s are the major market movers hence making it m ore difficult
to any new company to come out.
Hence the market is oligopoly.
Conclusions:
Marvel’s secret formula:
Rival DC—not Marvel—brought its comic-book superheroes to the big screen first. Movies have
been made about DC characters like Richard Donner’s Superman and Tim Burton’s Batman
since the 1970s.
But Marvel was the first to apply the method of universe-building perfected in its comic books to
film, beginning with Iron Man. Marvel Studios—the film arm of Marvel Entertainment, the
parent of the comic-book publisher—introduced Marvel’s biggest heroes, Iron Man, the
Incredible Hulk, Thor, and Captain America, one by one in solo films that all took place within
one broader world.
After establishing the individual franchises, Marvel brought them together in its first crossover
film, Marvel’s The Avengers, which had never been done before in Hollywood and borrowed a
common tactic from comic-book publishing. The formula worked as brilliantly in film as it does
in print, and allowed Marvel to create a rich world full of vibrant, developed characters and
interwoven storylines (filled with Easter eggs) that audiences couldn’t otherwise get from a
single 90-120 minute film, or even a single franchise.
Drawing from its deep bench of heroes and villains has also helped Marvel stave off the
franchise fatigue that has plagued other properties. Where audiences are growing tired of long-
running franchises like Transformers —the latest instalment, Transformers: The Last Knight,
would have lost money this year, if not for overseas returns—Marvel keeps its films fresh by
introducing new and unlikely heroes and team-ups each year, such as The Guardians of the
Galaxy and Doctor Strange movies, and tapping promising young directors and talented actors to
helm them.
The 2016 debut of Doctor Strange, with Benedict Cumber batch in the lead, was Marvel’s largest
solo superhero introduction. And Marvel’s The Avengers movie is still the biggest debut for a
Marvel franchise overall, unadjusted for inflation. (The Avengers will become Marvel’s fourth
trilogy when The Infinity War is released in 2018.)
The initial success of Iron Man, which made the second-biggest non-sequel debut ever in 2008,
caught the eye of Disney CEO Bob Iger, as well. Less than a year later, Iger said Disney would
buy Marvel and its more than 5,000 characters for $4 billion—which seems a bargain now.
Suggestions:
• In order to generate more demand in the market they should now start focusing on new
characters as it has been decades since they have launched the new characters in the market.
They are more focused on making movies and stories on the older characters. This may lead to
the generation of disinterest in the consumers in long run.
• Their rivals i.e. DC comics have collaborated with Netflix which is next upcoming
sensations. All the series of the DC comics are first released on Netflix which gives a
competitive advantage to DC. Marvel should also go with the flow of the change that is moving
from the tradition TV to digital market.
