The Marvel Way

Presented by Group 2

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 Marvel's Early
Years
• Martin Goodman founded the company in 1939. He wrote pulp literature, periodicals, and
comic books, among other things.
• Goodman's method was simple: make a lot of titles, then "add a few more if you get a title
that gets on; you're in for a tidy profit."
• The comic book industry flourished in the 1940s. (Children's television shows, games, and
websites, for example (Smartphones, tablets, and other forms of media).
• Company would go on to produce over 8,000 characters over the next few decades.
• Aside from the legendary Captain America, the most of the comics were blatant rip-offs of
the more successful DC Comics.
• Comic books have been connected to teenage pregnancy and homosexuality, according to
Dr. Frederic Wertham.
• The Comics Code Authority was established by the industry as a self-censorship body.
MarveAl's Red Ocean Strategy
• During its downfall beginning in 1968, Marvel's strategy devolved into Red Ocean. Goodman
had sold Marvel to global Cadence Industries for around $15 million as the company's
creator. On the other side, there was a necessity for people, profit, and value alignment in
the Blue Ocean approach. The lack of structure in maintaining a fair procedure has a
negative impact on employee motivation, resulting in a decrease in profit generation.
• Marvel was sold to New World Entertainment by Cadence again after a period of time in 1986, which
was the worst move ever made. This was due to the fact that the company's leaders were unaware of
the discrepancies.
Fall of competitive Strategy
Marvel's competition was with itself, not with anyone else on the market. However, DC seized
the market, severely limiting Marvel's expansion and ultimately in the company's demise and
financial difficulties. This went on for a longer length of time, and Marvel's battle to stay
competitive in the market remained. During this time, Marvel was sold twice, which was a
major factor in the company's remarkable expansion in comparison to its only market
competitor, DC.
The Marvel Way: Restoring a Blue Ocean
• The studio, which had battled to make payroll just a decade before, had now unlocked a
blue ocean of filmmaking, yielding more income and profit than any other film franchise in
history.
• The credits roll after Iron Man smashes his way to triumph.
• The eye patched roundabout announcement/moment To Tony Stark, Nick Fury discusses
the Avengers initiative.
• This was the point at which the Avenger Initiative took over the restoration of all
superheroes.

Marvel’s First Blue

• By the time the comic book craze died down, Marvel and DC Comics were the only publishers
left. Ocean
• DC bought Marvel's distribution business and put a cap on how many books they could sell.
• Marketing low-cost knockoffs aimed at youngsters would not be enough to keep the business
afloat.
• Marvel's first goal was to produce little original content and a lot of clones.
The Marvel Way: Restoring a Blue Ocean
• The studio, which had battled to make payroll just a decade before, had now unlocked a
blue ocean of filmmaking, yielding more income and profit than any other film franchise in
history.
• The credits roll after Iron Man smashes his way to triumph.
• The eye patched roundabout announcement/moment To Tony Stark, Nick Fury discusses
the Avengers initiative.
• This was the point at which the Avenger Initiative took over the restoration of all
superheroes.

Marvel New Strategy: to attract non-customers

• Original content geared at college students, an older market.
• Marvel characters begin as ordinary people who are converted into reluctant superheroes, often by
accident.
• Stan Lee, Marvel's Editor-in-Chief, and comic book giants Jack Kirby and Steve Ditko (From 1961
through 1965, he unleashed a multi-year creative surge that gave birth to a new blue ocean.)
• In 1961, Marvel debuted the Fantastic Four, a group of four regular people who were
transformed into superheroes by cosmic rays.
• The Incredible Hulk is a peaceful scientist who, when enraged, transforms into a violent green
monster.
• Thor is a God of Thunder who comes to Earth in the form of a superhero.
• Ant-Man is a reformed crook who shrinks.
• Steve Ditko - Spider Man, a youngster who gets spider-like abilities after being bitten by a
radioactive spider.
• Lee’s focus on non-customer college students opened a blue ocean where Marvel thrived.
• In 1965, 35 million and 72 million in 1967, comic books were sold.

Creation of Blue Ocean

• Lee and his team decided to bundle their superheroes into a group called The Avengers.
• Another group of entirely different characters, ordinary people endowed with
extraordinary powers and distrusted by the unenhanced they lived amongst, The X-Men.
 Evaluating Post Bankruptcy Marvel
CHARACTER M A RV E L
TRADING
TOYS LICENSING STUDIOS
COMIC CARDS
BOOKS In 1998, Marvel got Marvel had a few of
Generates most of
a licencing fee of Skybox and Fleer,
marvel's revenue individuals in
$4.9 million for a Hollywood licencing both trading card
Comic book Revenue expected to
gross profit of $4.5 to motion picture firms, were acquired,
intangibles worth increase with movie deals as was Panini (an
million, however the companies for films.
$127.7 million * IP, Low-margin business profit was projected Italian company).
They did not make
characters, goodwill, Marvel leveraged their to be $4.5 million. movies, but they There was no profit or
brand, storylines. unique character’s he cost of drafting a boosted the sales of revenue because
Single source intellectual property to contract is low, but licenced goods by collectors tended to
distribution system build high quality toys the profit margin is raising demand for acquire based on
in the 90's considerable. Marvel characters speculation rather than
through films genuine interest.
Management Stabilizes the business

1999: DIRE MOVIES TRADING TOYS

TIME FOR CARDS
Sony purchased Spider-Man Low Margin , High Risk/
M A RV E L
for $10 Million plus 5 Feb 1999: Divested In 1999 , sold exclusive rights to their
percent first-dollar royalties. Trading cards for $26 toy Manufacturer for $5 Million per
Marvel was cash-strapped
Twentieth Century Fox : X- million to Skybox and year fee.
and faced annual junk-
Men, The Fantastic Four Fleer. Additional 24.5% fees for Marvel to
bond interest payments of
Universal: Hulk Movies. The Expected value continue designing toys.
$30 million.
These Movies brought the was $410 Million. Sold off $25 Million inventory and got
eter Cuneo: Focussed on
required capital to Marvel. (94% Loss). an influx of cash.
core businesses: Selling
Trading Cards: Besides financial stabilisation, Cuneo
comics and Movies.
focussed on preserving the culture at
marvel.
The birth of Marvel Studios
• David Maisel advocated in 2004 that a legitimate movie company be established to fund
and produce Marvel films.The Incredible Hulk is a peaceful scientist who, when enraged,
transforms into a violent green monster.
• Character licencing caused Marvel to forego huge earnings in exchange for less creative
freedom.
• 'The Marvel Way' - It was meant to run the studio with a cost-conscious culture, with Marvel
Studios on the lookout for costs that did not provide equal buyer value.
• In California, the studio was above a car dealership, no free lunches or coffee were
provided; old, barebones office furniture was used; and studio overhead was reduced by
30%.
• The Hollywood Way' of filmmaking was avoided: the characters were the film's heroes; high-
paid actors and actresses were avoided; and good actors, directors, and producers were
pursued.
• Talented actors with reduced salaries were hired
 Marvel's Blue Ocean in numbers
23 BILLION
W O RT H O F O N LY M A RV E L $176.2 MILLION
CHARACTERS IN COMIC BOOKS

$373.6 MILLION $662 MILLION

M A RV E L C H A R A C T E R S A N D
M A RV E L P R O D U C T I O N S ( 3 7 5
F O R M A RV E L C H A R A C T E R S T H AT
PERCENT MORE)
A R E N ' T M A N U FA C T U R E D B Y
M A RV E L ( 2 1 2 P E R C E N T M O R E )

Marvel's productions aren't for the faint of heart. The Avengers

grossed over $1.5 billion, making it the third highest-grossing
film of all times.
The Holy Grail of Entertainment
● The Wagon Wheel
○ Hub: Intellectual Property (characters and brands)
○ Spokes: Monetization of the IP (Media forms, Consumer product categories, etc.)
○ Rim: Synergy between the spokes
● Evolution of the wheel
○ Wobbly wheel: 2 spokes – Comic book business (print media) and Toy business
○ Addition of third spoke, Motion pictures, started with X – Men 1
○ From 2 spokes to 10+ including Licensing, Video games, Television, Amusement Park attractions,
etc.

“The Holy Grail of Entertainment is owning and controlling your own IP to maximize spokes on
the wheel.”
Why Marvel does it the best
In 2015, a unique agreement was reached between Marvel and Sony for
cross-licensing Spider-Man
• Sony to license Spider-Man character back to Marvel for Marvel-produced movies with
the other superheroes
• Marvel to produce future stand-alone Spider-Man movies, hiring the director, reviewing
the script, and shooting them the ‘marvel way’
• No money involved: Zero royalties to be paid to either party
• Royalties for even the most successful Spider-Man movies were marginal compared to
overall movie revenue
• Displeased by the use of X-Men and Fantastic Four by 20th Century Fox, Marvel
strongly prefers Marvel characters be produced by Marvel Studios
Why Marvel does it the best
In 2015, a unique agreement was reached between Marvel and Sony for
cross-licensing Spider-Man
• Sony to license Spider-Man character back to Marvel for Marvel-produced movies with
the other superheroes
• Marvel to produce future stand-alone Spider-Man movies, hiring the director, reviewing
the script, and shooting them the ‘marvel way’
• No money involved: Zero royalties to be paid to either party
• Royalties for even the most successful Spider-Man movies were marginal compared to
overall movie revenue
• Displeased by the use of X-Men and Fantastic Four by 20th Century Fox, Marvel
strongly prefers Marvel characters be produced by Marvel Studios