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Friday, December 05, 2003

How Michael Eisner Screws Up his Mickey Mouse Brand

Over the years, I've written a lot about the branding of big business. I especially like to follow the foibles of Fortune 1000's as they trip, stumble and fall along their respective paths. I'm grateful to them, as should you be, for the free, real time lessons they teach us for absolutely free. All we have to do is read the daily newspaper and pay attention.

Every so often, a brand goofs so badly, so publicly, that like the proverbial train wreck, it's just impossible not to watch. So I hope you were watching this week as the Disney company essentially fell apart in the public press.

If you weren't watching, this was one lollapalooza: Two members of Disney's board of directors accused their CEO of gross mismanagement leading to the decline of the company's performance. The players are none other than Roy Disney (nephew of Walt) and Michael Eisner (the current Disney CEO).

Public infighting is never classy, but it is always fascinating. Especially when the combatants leak their internal memos to the press, which is exactly what Roy Disney did last week. What I find interesting, however, isn't the dirty laundry as much as the tack Roy Disney took in taking Michael Eisner to task. Usually, this kind of drubbing is over revenues and corporate tactics. This time, it was different. Here's an excerpt of Eisner's failures from Disney's memo, in Roy's own words:

"3. The timidity of your investments in our these park business. At Disney's California Adventure, Paris, and now in Hong Kong, you have tried to build parks 'on the cheap' and they show it, and the attendance figures reflect it.

"4. The perception by all our stakeholders - consumers, investors, employees, distributors and suppliers - that the Company is rapacious, soul-less, and always looking for the "quick buck" rather than the long-term value which is leading to a loss of public trust.

"5. The creative brain drain of the last several years, which is real and continuing, and damages our Company with the loss of every talented employee."

And so on and so forth. The entire memo actually has seven points, but if you notice, these three pretty much tell the story: Eisner has no idea what branding is about. Sure, he knows about the value of a brand, but not branding itself. Now you know why I continue to assert that branding is the most misunderstood aspect in all of marketing.

The guy who really knew branding was Uncle Walt, the man everyone said was crazy back in the early 1950's when the plans for the original Disneyland were still on the boards. Architects, industry savants and accountants couldn't figure out why Walt insisted on planting real trees and flowers, or why he placed benches throughout a park whose revenue came from rides.

The tragedy is that Walt Disney knew about branding. He eschewed the quick-buck profit for the long term loyalty, which paid out in spades. Four generations of Americans learn about Disney as one of their first five brands and stick with it for life. They did, at least, until Michael Eisner got a hold of it. Roy Disney knows about branding, which is why he's hopping mad. He's watching everything his uncle and father built over a half century going straight down the tubes in a quarter of the time.

So what are the crimes that Eisner has committed and why do they matter to you? Well, if you look at them in the abstract, they're frighteningly close to what you and I wrestle with every day:

1. Eisner has totally lost sight of what the Disney brand is. Instead of building the company on the same set of values, Eisner has supplanted his own set of criteria. Clearly, what was once a brand based on consumer satisfaction is now driven solely by money.

2. Eisner has chosen to exploit (read: sell out) his brand value, instead of cultivating it. Hey, anyone here remember Go.com? That was Disney's unbelievably unsuccessful crash and burn into the dot com world, where he thought he could buy up the internet for his own. Under his tutelage, Eisner has gone out and bought almost everything he can lay his hands on, with the one exception of products and services that reinforce his own brand. Television networks, movie studios, retail chains - you name it, he's pissed them off by throwing the Disney brand around, instead of leveraging its value.

3. Eisner has cut himself off from reality, completely forgetting that "the brand is about them, not you." Roy Disney finally had the courage to spell out what everyone already knew, when he nailed Eisner for his "consistent micro-management of everyone around you with the resulting loss of morale throughout this Company."

Ouch.

While the press continue to speculate about Michael Eisner, they have, predictably, missed the real story here. This isn't about one man's career being threatened. This is about that man's complete and total ignorance about brands and how they get implemented, eventually leading to his destruction, the company's destruction, or even both.

These aren't issues just for the big boys, either. Look around you. Is your business faithful to its brand? Do your employees and associates buy into it? It's never too late for a reality check. Otherwise, you may find yourself reading a memo about your company in tomorrow's newspaper.

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