How did Disney create value when using a diversification strategy.docx

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1)Disney created value when using a related diversification strategy. By using this strategyto simultaneously create economies of scope through operational and corporate relatedness. By creating economies of scope, the different Walt Disney Companies can support each other by sharing knowledge therefore creating larger profit margins.Disney owns a several corporate entities that are closely interlinked and create large synergies since they are all dealing with related businesses. Examples:Cross selling their products. The characters in their movies can also be found in their Disney retail stores as figures, clothing, and DVD’S, which are found in theirtheme parks and resortsDisney owns large network of TV and Radio channels, enabling them to advertise products across the whole global companyDisney owns several movie distribution companies (Touchstone Pictures, Hollywood Pictures and Dimension Films). They can gain economies of scope by sharing activities among them.

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