February 4, 1958 Wall Street Journal article on Walt Disney:

“Walt’s Profit Formula: Dream, Diversify—and Never Miss An Angle”  The formula: Wring every possible profitable squeal and squeak out of such assets as the Three Little Pigs and Mickey Mouse—first by diversifying into a wide variety of activities, then by dovetailing them so all work to exploit one another.

Walter E. Disney and his crew of starry-eyed artists and ingenious innovators are by all odds kings of the kid frontier. But they’re also shrewd businessmen who inhabit no financial fantasyland. And companies beset by earnings’ erosion may find some profit-making pointers by elbowing the kids aside and taking a look at the integrated doings in the wondrous world of Walt Disney Productions.

“Integration is the key word around here; we don’t do anything in one line without giving a thought to its likely profitability in our other lines,” says Roy Disney, President of WDP and older brother of Chairman Walt. To see what Roy Disney means, consider Sleeping Beauty, a cartoon epic currently in the WDP works. This 70-or-so-minute film, already three years in the making, won’t hit theatre screens until Christmas. But the fairy tale already is paying off for Disney.  For example, at Disneyland, the film has been transformed into colorfully animated dioramas complete with trick photography to make them come alive. Children and adults line up, sometimes four abreast, for the 10-minute walk through the Sleeping Beauty attraction at 35 cents a head.

Another Disney department, Licensing, also has gone to work on Sleeping Beauty, lining up toy makers, garment producers and others interested in making articles based on Sleeping Beauty characters.  Sleeping Beauty also is getting the build-up treatment on the publishing front, with New York’s Simon & Schuster pouring various versions of the fairy tale into the nation’s bookstores.

By early October, with the start of the fall television season, Beauty will be stirring on the nation’s TV sets as Disney script writers work in repeated references to the coming film on such programs as Disneyland and, perhaps, put together a special program or two about it. A month later, WDP’s phonograph record division will be spewing forth platters based on music from the film. And about six weeks before the movie is released, the studio’s comic strip artists will launch the Sleeping Beauty story in Disney’s own syndicated newspaper cartoon strips.

And Sleeping Beauty won’t fade away after the movie’s showing. The cycle will be run through again in much the same fashion in country after country until nearly every moppet in the free world has had the chance of seeing the movie and buying a doll, reading a book, following a comic strip, and hearing a tune based on Sleeping Beauty.  Even then there still will be life—and profits—left in Sleeping Beauty.  Seven years after her screen debut Sleeping Beauty, in the form of a re-issued film, again will make the rounds of the world’s theaters.  “Walt,” says a close associate, “supplies ideas for every phase of this business—ideas for new films, for new features in the park, for new merchandise, even for new songs. But it’s his brother Roy who keeps him from getting carried away and makes sure that the company’s financial feet are always solidly on the ground.”

Accompanying the above 1958 Wall Street Journal article was an illustration of how Disney “integration” permeated the company at that time.  Depicted was a central film asset (such as Sleeping Beauty) with an outgrowth of lines to an array of related company properties that in very precise ways infused value into and in turn supported the central theme. The lines crisscrossed each other going this way and that to every division of the company. Walt Disney’s vision in this “map” defined his company’s key assets, stemming from a valuable and unique core, and identified patterns of complementary benefits.

Shown within the one-page illustration was a range of entertainment related assets—books and comic books, music, TV, a magazine, a theme park, merchandise licensing—surrounding a core of theatrical films. It illustrates a dense web of synergistic connections, primarily between the core and other assets. Comic strips promote films; films feed material to comic strips. The theme park, Disneyland, plugs movies, and movies plug the park. TV publicizes products of the music division, and the film division feeds “tunes and talent” to the music division.

The Journal article put Walt’s theory into words:

Disney sustains value-creating growth by developing an unrivaled capability in family-friendly animated (and live-action) films and then assembling other entertainment assets that both support and draw value from the characters and images in those films.