TO: Tiffany Morrow, Vice President of Marketing, Destiny Marketing
FROM: <Name>, Marketing Analyst, Destiny Marketing
DATE: <Date>
SUBJECT: Disney+ Streaming Service Market Segmentation Memorandum
The purpose of this memorandum is to analyze Disney+ current and future market
segments for The Walt Disney Company. The analysis will cover different market segmentations
based on percentages of the population, current subscribers, and users of Disney+. After
concluding the analysis, recommendations will be provided regarding the suggested approach to
secure the highest number of new subscriptions.
I. Market Segment Analysis
The target audience for Disney+ is primarily families, encompassing all family members,
including grandparents, rather than just children. The original content of Disney+ was catered to
ages 17 and below, and those older individuals that love childhood memories with classic Disney
movies. A recent analysis within the United States has shown that users ages 17 and below still
make up 45 percent of Disney+ users. Their millennial parents ranging from 28 to 43 make up
approximately 20 percent of the users and are the largest subscribers at 42 percent (Shewale,
2024). However, the additional content from Marvel, National Geographic, Pixar, Star Wars,
Hulu, and ESPN makes its target segment even broader (Disney+, 2024b). Once they made this
switch it added additional content but still only the ones that were PG-13 and below. The
customer base for this was primarily still 17 and below but with this move, they have gotten
additional subscribers from ages 18 and above or Millennials (Bajer et al., 2023).
Disney+ has now added R-rated and TV-MA-rated Marvel movies, including other
movies above PG-13 since they upgraded the platform with parental controls. The parental
controls allow parents to set individual profile content ratings that each user can watch and then
all other content above that rating will be locked out. The addition of this feature will
differentiate the content for the chosen age group of the user. Another added feature is that
profiles can also be locked by a pin so no one can leave their profile or access another profile.
The new features, along with the added content, continue to cater to families while also
expanding their services to include more adults without children as well (Disney+, 2024a).
Initially, Disney+ predominantly targeted families with children as its primary
demographic segment. This was primarily due to the inclusion of Disney's timeless content
and shows, which resonated well with this particular audience. The families included are not
just the immediate family, but also the grandparents and multi-generational families.
However, with the additional and future content they have announced, Disney+ now covers a
wide demographic segment. Disney+ now embraces a wide range of individuals,
encompassing diverse age groups, genders, nationalities, and interests (UMGC, 2024, “Week
4: Segmenting and Targeting Markets and Customers,” para. 45-46). They not only cater to
children, and families alone but to every generation alive today with affordable rates with the
, Direct-to-Consumer service. Disney+ is targeting every generation today with a wide range of
movies, one-of-a-kind TV series, and of course, children’s shows (Disney+, 2024b).
Millennials are very proficient with current technology since they grew up with these
inventions when they came out and appreciate quality content. They are very future-oriented
as early adopters and very receptive to trying innovative technologies or services when they
are produced. The primary segment from the psychographic survey of Values, Attitudes, and
Lifestyles (VALS) is Innovators. Millennial innovators will watch marketing from the TV,
internet, and social media because they have a wide variety of interests (UMGC, 2024, “Week
4: Segmenting and Targeting Markets and Customers,” para. 93).
II. New Market Segments
The company should keep adding exclusive adult-oriented content to Disney Plus in the
U.S. to expand its customer base and diversify its customer base. This strategy will facilitate
diversification and the establishment of a target consumer group. In addition, Disney+ ought to
work with its partners to produce even more original and varied content for the service's
collection. The primary target segment should be the technologically proficient Millennials who
are between 28 to 43 years old. The majority of this generation has been raised in an era of
advanced technology. Approximately 93 percent of individuals own smartphones, with more than
80 percent actively participating in social media. Millennials are mostly the ones who still have
families that live in the same household right now (UMGC, 2024, “Week 4: Segmenting and
Targeting Markets and Customers,” para. 49). The Millennials are the most established family
group and represent 21 percent of the population in the U.S. (US Census Bureau, 2023).
The secondary should be Generation Z, who are the most adept at using all the features
technology has to offer and are between 12 to 27 years old. Generation Z also represents over 19
percent of the population within the U.S. (US Census Bureau, 2023). They have grown up with
the latest in technological innovations and are very inept at navigating social media. These are
the VALS experiencers who have grown up with all this visual input and visual stimulation.
The Generation Z group is part of the younger population that is still watching Disney classics
and newer movies but are also adults now who will want more (UMGC, 2024, “Week 4:
Segmenting and Targeting Markets and Customers,” para. 49). Adding additional and original
content that cannot be seen anywhere else will increase subscriptions for a wide-scale
demographic audience (The Walt Disney Company, 2023, p.9).
With the additional and more adult-oriented content, this could also target Generation
X who are between 44 to 59. These are the VALS achievers who have created, used, and are
the bridge from the limited technology era to the new modern technological inventions. They
have seen all the new technological innovations shape the modern world, with about 90
percent of them having smartphones and using social media (UMGC, 2024, “Week 4:
Segmenting and Targeting Markets and Customers,” para. 49). They make up approximately 20
percent of the current population and do use direct-to-consumer services (US Census Bureau,
2023). From personal experience, they tend to use Netflix, Amazon Prime, and ESPN right
now.
