MKTG 4460 01:

Marketing Environmental Analysis of

Marvel Entertainment LLC.
Shaalika Jagadishwaran
T00581926
Shaalika Jagadishwaran Marketing Environmental Analysis - Marvel MKTG 4460 – 01
T00581926

Marvel Entertainment LLC., (Formerly Marvel Entertainment and ToyBiz Inc) is a wholly

owned subsidiary of The Walt Disney Company. It is arguably one of the most prominent

“character-based entertainment companies”. Each of the 8000 thousand characters is a

trademarked brand and often interact with each other in stories across several forms of media.

Although a popular name among comic books enthusiasts, Marvel has been known to make bold

business decisions. From buying a successful toy company in the late 90s to selling their assets to

Disney earlier this decade, resulting in questionable artistic choices and subsequently, a widely

segmented consumer market.

In 1998, the company had filed for bankruptcy due to rapidly dying sales of their core

products: comic books and trading cards. While this was a major setback, the company had already

made plans to acquire a toy making company and open up a studio to earn back the money to buy

their own shares back. In the same year, they had launched their first successful comic book hero

movie, Blade, marking the start of Marvel’s career in the film industry. Two years later, Marvel

would go on to license Fox studios to launch X-men. All of which will culminate in the Marvel

Cinematic Universe we know today, and will continue to see more of in the future.

In this PEST analysis, I intend to look at factors that affect the company and identify threats

and opportunity in Marvel’s business environment.

Political Factors:

Art is inherently a commentary on the socio-political landscape of a country. As Marvel is

an American entertainment company, their content often centers around political events that have

affected or could affect the United States. It is interesting to note that this fact is often either

overlooked or downplayed while discussing Marvel movies. The character of Captain America

1
Shaalika Jagadishwaran Marketing Environmental Analysis - Marvel MKTG 4460 – 01
T00581926

was created in the 1940s, when the United States was actively participating in Word War 2. Today

in the Western world, Nazism is still a controversial subject to bring up, but Marvel Studios have

not only been able to bring it up nearly unnoticed but also went on to earn billions from the Captain

America franchise.

Like most other companies in the mainstream entertainment industry, Marvel too has

broached the topic of terrorism and rising tensions in the Middle East. Again, the association of

real-world hardships with our favourite suited heroes is not an immediate connection that one tends

to make, as the company does well to position themselves as universe of “action heroes”, and

hence the focus is drawn more toward the character themselves.

It is not uncommon for artists to have their lives endangered because of the expression of

their political views in their work. However, I do not see Marvel’s tendency to touch on politically

sensitive topics as a threat to the business. Although, the company was already quite big and

powerful even before it was acquired by Disney, it is a relatively new entrant in the film industry

and it’s hard to take a movie too seriously when the main characters are wearing spandex suits.

It is important to note that policy changes in terms of international trade and copyright law

would significantly affect Marvel, as their most important assets are the copyrights and trademarks

of the characters. As the world is growing smaller and closer, the company is forced to comply

with international trade standards. (Writer S., 2019)

Moreover, as Marvel is now a part of the Disney holding company, the criticism that

Disney has been receiving for not disclosing their lobbying activities will affect Marvel eventually.

(Jolly, 2018)

2
Shaalika Jagadishwaran Marketing Environmental Analysis - Marvel MKTG 4460 – 01
T00581926

Economic Factors:

As of 2018, Marvel owns 38.42% of the market share in the publishing industry with a total of 120

new titles shipped, 33 of which were graphic novels. Their main competitor is DC, who own

30.54% of the publishing market share. Since 2017, Marvel has taken the lead by about 8%. This

success could be attributed to the success of the Marvel Cinematic Universe, which is a media

franchise of television series, web-series and movies, that exclusively feature Marvel characters.

(Previews World, n.d.) Between 2008 and 2018, Marvel has grossed over $12 billion USD from

worldwide box office. The least successful movie Marvel has made in the past decade was The

Incredible Hulk and even that had earned $263 million USD at the worldwide box office, whereas

Avengers: Infinity War, the most popular movie yet, had earned over $2 billion USD (Forbes).

Typically, Marvel movies tend to make almost thrice as much box office sales internationally than

they do in their home country of United States. And those are figures from the movies alone, not

taking into account the profits earned from Netflix.

The CEO of Motion Picture Association of America Chris Dodd had once claimed while

addressing the National Press Club in Washington, DC, “No other major American industry has a

balance of trade as positive in every nation on the globe in which it does business than the

American film industry.” Considering the fact that superhero movies tend to be highly successful

in theatres, Marvel is potentially a large contributor to the positive balance of trade. (Caldwell,

2013)

Hence, what was previously a very niche market where fans would be teased for their

interest in comic books is now part of mainstream entertainment. The movies have helped to grow

the existing demographic and open up new ones outside the United States. A major opportunity

3
Shaalika Jagadishwaran Marketing Environmental Analysis - Marvel MKTG 4460 – 01
T00581926

for Marvel now is to create new characters to launch in international markets to compete with their

local comic book brands.

Social Factors:

The industry is seeing some huge waves being made in the effort to be more exclusive to

people of colour and members of the LGBTQ community. But what is often an attempt at being

more inclusive tends to have more of the opposite effect. Changing the race of a character who

was once originally white comes off more as a consolation prize rather than a sincere attempt at

being inclusive. The easier, less risky, and less expensive business option is to retcon backstories

of known characters and give them a more modern and diverse makeover. However, audiences are

smart and will catch on. An example of this was the South-Asian Flash Thompson in Spider-man

Homecoming. Or a special edition Indian Spider-man, where we meet Pavitra Prabhakar instead

of Peter Parker.

This trend has become more noticeable since Disney had acquired the company. It is no

secret that a common theme in Disney productions is tackling heavy social issues in a more

palatable manner. However, in order to be able to align with company goals while still remaining

true to the source material, Marvel should invest in more a diverse but new roster of characters. A

good example of inclusivity done right is Black Panther. The characters were all original and have

always been of African descent.

Disney’s insistence on political correctness when not needed, in my opinion, is a threat to

Marvel. Regardless of the racial structure of the target segment, fans appreciate consistency and

progressiveness, while they would love to see more representation in the media, changing traits of

4
Shaalika Jagadishwaran Marketing Environmental Analysis - Marvel MKTG 4460 – 01
T00581926

a character in a highly visual medium is not a good option to adapt to a market undergoing cultural

changes.

Technological Factors:

Given that comic books are a visual media and technological changes are incredibly disruptive in

any industry, it was smart of Marvel to shift focus from comic books to movies and television. In

future, there might be room for immersive or interactive video games or both. There have been

talk of such items at Comicon, a convention for comic books fans, of RPGs where one can play as

a comic book character.

As Disney is now acquiring Fox, the company might take over their streaming services as well.

This spells good news as all the Marvel shows on Netflix had been cancelled due to this merger.

Because Disney is quite conscious of its image and wants to come off as family-friendly

entertainer, it is probably in both Marvel’s and Disney’s interest to have a separate streaming

service for Marvel content. The unavailability of Marvel on an accessible streaming service like

Netflix makes it vulnerable to competition from DC.

Conclusion

Marvel, although a little more light-hearted than its counterparts, is not necessarily targeted to

children. And as analysed, there are several opportunities and threats that Marvel, and now Disney

need to be wary of in order to protect its market share from DC and other smaller competitors.

5
Shaalika Jagadishwaran Marketing Environmental Analysis - Marvel MKTG 4460 – 01
T00581926

References

1. Writer, S.S. (2019, January 15). Marvel Enterprises, Inc. PESTEL Analysis & Solution/ PEST Analysis,

STEP Analysis. Retrieved from http://blueoceanuniversity.com/frontpage/pestelcase/14032-

marvel-characters

2. Jolly J. (2018, November 26) Disney, Huawei and EY among worst offenders in disclosing lobbying.

Retrieved from https://www.theguardian.com/politics/2018/nov/26/disney-huawei-and-ey-

among-worst-offenders-in-disclosing-lobbying

3. Publisher Market Shares: June 2018 (n.d.) https://www.previewsworld.com/Article/215704-

Publisher-Market-Shares-June-2018

4. Caldwell, L. (2013, February 25). The Politics of Entertainment. Retrieved from

https://www.huffingtonpost.com/lindsay-caldwell/the-politics-of-

entertainment_b_2728206.html