Disney’s CEO has admitted the company is yet to strike the right “balance” on its marketing spend behind its streaming services.
“We actually have not really achieved the kind of balance we know we need to achieve in terms of cost savings and pricing and money spent on marketing,” CEO Bob Iger told investors on a call overnight (9 August).
The business launched its Disney+ streaming service in 2019 and owns other direct-to-consumer streaming products, including Hulu and ESPN+.
An investor on Disney’s quarter three earnings call put to Iger that the margins on Disney’s DTC portfolio are “meaningfully below where Netflix was at a similar revenue scale”.
Iger admitted: “We’d love to have the margins Netflix has.”
However, he pointed out that Disney’s DTC efforts were less than four years old, versus Netflix which is more experienced, having begun streaming in 2007.
“[Netflix] figured out how to really carefully balance their investment in programming with their pricing strategy and what they spend in marketing,” Disney’s Iger said, adding that his company still has room for improvement in this area.
