– By Katherine Sanderson –
This is the first article in a six-part series (the third and fourth will cover ‘Star Wars’, and the fifth and sixth will cover ‘Harry Potter’). For each brand, the first article will cover the corporate strategy that initially launched them, and the second will cover how they expanded the brand, with marketing partnerships, consumer products, and themed entertainment.
By 1996, Marvel Films (as it was called in the 1990s) and its parent company Marvel Entertainment had gone bankrupt. In 2000, they reportedly only had $3 million in the bank, and 250 employees. But over the last 20 years, Marvel has rebranded itself, and is now reaching a far wider audience in more markets than ever before. With the success of Black Panther and Avengers: Infinity War in the last few months, Marvel Studios are on track to have over $3 billion in international box office receipts, just for this year – and 2018 is only half over.
Arguably, Marvel is now one of the most powerful brands in the world. But not every film studio or franchise is destined to become a brand. Marvel had a slight advantage, as they have technically been a brand since Marvel Comics predecessor began in the 1940s. But with their brand being diluted in the 1980s and 1990s, how has Marvel made a comeback, and found such immense success in the last decade, not just domestically, but globally? Especially in comparison to their main competitor DC Comics? There are quite a few reasons (that could take pages to fully analyze!) But in this article, we’ll just cover the crucial decisions that in the early years of Marvel’s revitalization set them on the path for greatness.
But before we start… what is a ‘brand’? Especially a ‘global brand’? Business neophytes often think of ‘brand’ to translate into a brand’s name, logo, color scheme, etc. But in reality, it’s so much more than that. It is the qualities, the images, and the feelings that comes to the mind of your customers when they think of your company. A global brand is one that is recognized worldwide.
For me, there are four major areas of business that every film franchise must conquer to become a global brand:
- Corporate Strategy
- Marketing Partnerships
- Consumer Products (i.e. Toys, Books, Clothes, Video Games, etc.)
- Themed Entertainment (i.e. Theme Parks)
In this article, we will just cover the first one: corporate strategy.
Corporate Strategy (i.e The New Beginning)
So first, how did Marvel initially pull itself out of bankruptcy in the 90s, rebrand themselves, and gain enough capital to allow them to eventually go on to become one of the most recognized brands in the world?
Peter Cuneo, the CEO/CFO of Marvel Entertainment from 1999-2002, deserves a lot of credit – and I mean a lot of credit. During that time, he was tasked with a three-year turnaround, a chance to reinvent the company. And according to a 2010 interview with Forbes, Cuneo did so by embracing developing a new corporate strategy, and by adhering to the following tactics:
- Licensing characters
The first step to grow their business and gain back enough capital to was to license their characters. They did this by adopting a licensing model that covered all forms of media from film and TV to consumer products, which would maximize the exposure of their brands worldwide in a short amount of time. They recognized that the future of their company would require them to expand into different mediums.
- Utilizing the comic books to test stories and characters with the public
Cuneo said in the Forbes interview “One of our greatest epiphanies was recognizing publishing as a research and development function for all of Marvel, and with outstanding profit potential. The quality of Marvel’s books had crumbled during the company’s troubled years.” They shortened story arcs, and their North American comic book market share grew from about 25% in 1999 to between 45% and 50% in 2010.
- Being frugal
Cuneo served as CEO/CFO during that time to save them half a million dollars annually. They rewarded good work with higher pay, but tried to cut costs in any area they could afford to. Their reputation in Los Angeles became one of penny-pinching and conserving cash.
- Giving the board of directors more power
The Marvel board of directors had their own office, and were very involved in the rebuilding of the company. Instead of having quarterly meetings like most shareholders, they sometimes were in weekly.
- Partnering with different studios
Initially Marvel Studios did this by partnering with different studios for the films, with initial Spiderman trilogy going with Columbia Pictures, X-Men being distributed by 20th Century Fox, and Iron Man distributed by Paramount Pictures. “Our strategy was to spread out our intellectual property among a variety of Hollywood studios, so that we could attract the most enthusiastic partners for each character. One or two film studios could never produce all the films we wanted, and we didn’t like the idea of being tied down to any single partner for all our films.”
By 2002, once they were financially stable, and implemented these follow-up strategies:
- Expand their international presence
Today, Marvel’s international licensing is equal to (if not more than) their domestic licensing.
- Self-produce animated television shows
The beginning of Marvel content were their animated series including X-Men:Revolution and Mutant X in the early 2000s.
- Launch an in-house movie studio
From 2002-2005, Marvel had raised $525 million in funding, and in 2005, launched Marvel’s in-house movie studio. After seeing how other movie studios had made their characters come to life, they had confidence they could do just as well (or better!)
Since 2008, Marvel Studios has released 19 films within their new Marvel Cinematic Universe, from Iron Man (2008) to the most recent Avengers: Infinity War (2018), which in total have pulled in nearly $16 billion in box office receipts. And there are now 10 television series in the Marvel Cinematic Universe. With ABC reporting that series airing on their network have averaged around 4–8 million viewers a season.
To learn more about how how Marvel became a global brand, check out Part Two!
About the Author
Katherine Sanderson currently resides in Los Angeles, CA. Originally from Colorado, she graduated with a BA in English from Santa Clara University in 2014, and is an alumna of the JPCatholic MBA program (Class of 2016). Her professional aspirations are in children/family entertainment, especially animation.
Image Credit: Marvel