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Disney Roars in Kingdom of Movie Merchandise : Marketing: The entertainment giant could reap $800 million in pretax profits over three years from the sale of ‘Lion King'-related items.

From Reuters

In Walt Disney’s latest film hit, “The Lion King,” the lion cub Simba grows up to thwart his treacherous uncle Scar and assume the mantle of leadership left him by his courageous father Mufasa. From an immature squeak, his roar grows to one worthy of a Lion King.

While King Simba rules the movie’s Pride Lands, in the land of animated films and the sophisticated marketing that accompanies their release, Disney is the Lion King, emitting a merchandising and licensing roar heard around the world.

In nearly every toy and department store and in most homes with school-age children, the Lion rules.

“ ‘The Lion King’ will be the most profitable picture Disney has ever had and the most profitable picture in the history of Hollywood,” says David Londoner of Wertheim Schroder, an investment firm.

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Other films have been bigger box office successes. But none can match the multimedia marketing muscle of the Lion King. Lion King related merchandise will generate about $1.5 billion in wholesale revenues, Londoner said. Disney will, over a three-year period, rake in about $800 million in pretax profits from its Lion King enterprise, he estimates.

“To put that in perspective, no other studio besides Disney has ever made more than $450 million from all its films combined in any one year,” Londoner said.

What has made Lion King the marketing success of all time for Disney studios?

“If ‘Lion King’ were not a good movie, the whole merchandising effort would have flopped,” said Ruth Roufberg, a toy consultant and nationally syndicated toy and game reviewer based in New Jersey.

Carol Moog, a psychologist and advertising consultant in Bala Cynwyd, Pa. said, “ ‘The Lion King’ is successful because it resonates with the real psychological themes of child development. It taps into childhood fears. It also taps into important themes of bravery and restitution.”

But universal psychological themes alone do not create enterprises like “The Lion King.” Credit the Disney marketing and merchandising juggernaut with making the cash registers ring long after the credits have rolled.

Disney’s “unbeatable brand name” and track record of creating characters that live in children’s imaginations make it a sought-after licensing partner, said Paula Pierce of McCollum Spielman Worldwide, an advertising research firm in Great Neck, N.Y.

“They’re brilliant at advertising and marketing,” Londoner says. Long the leader in the art of animated film, Disney has practically turned licensing into an art form.

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“Disney is just getting better at what they do,” said analyst Christopher Dixon of PaineWebber. “We’re seeing an extension of the licensing activity we initially saw with ‘Aladdin,’ ‘Beauty and the Beast’ and ‘The Little Mermaid.’ Clearly, ‘The Lion King’ benefits from that experience.”

Disney creates brands with shelf life, says Karen Raugust, executive editor of The Licensing Letter in New York.

“People look at these films not just as a movie, but as a long-term entertainment brand,” she said.

Licensers and retailers also count on the marketing support that Disney provides.

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“In effect, the toys are pre-sold to the consumer,” said toy consultant Roufberg. She noted that the toy industry’s annual Toy Fair, held in February, featured “tons of Lion King merchandise” on display for retailers, months ahead of the film’s summer release.

“With all the money invested by Disney, by licensers, manufacturers and retailers, a whole culture grows up around pushing the merchandise to kids,” Roufberg said.

Whatever the tributaries, Lion King merchandise appears to be flowing into the hands of eager young consumers.

Toys R Us has more than 200 Lion King-related products highlighted by jungle-like displays at store entrances. It says the items have been “extraordinarily” successful.

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“The movie brought a phenomenal amount of people into our stores to look at Lion King-related products,” said Toys ‘R’ Us spokeswoman Carol Fuller. She said the toy retailer expects Lion King lunch boxes to be a big back-to-school success and Lion King products--ranging from pencil boxes to sleeping bags--to be “a huge seller” right through the holiday season.

Mattel Inc. spokeswoman Donna Gibbs says the giant toy manufacturer projects worldwide revenue from its Disney products to reach $400 million in 1994, up from $330 million last year, due largely to the success of Lion King products.

But Disney said the thrust of its business remains entertainment, not retailing.

“The film does come first,” cautioned Chuck Champlin, spokesman for Disney Consumer Products. “We all watch the animation group with such admiration and awe. Without the original product, the merchandise wouldn’t come to anything.”

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