Executive Summary
In the UK market, Disney+ UK is a comparatively recent streaming platform. The Disney-owned streaming service provides a vast selection of Disney-branded films and TV programs, as well as content from Marvel, Star Wars, and National Geographic. Nevertheless, Disney+ UK must initiate an acquisition effort to attract additional customers amid fluctuating demand in the streaming sector.
In a world of fierce competition, acquiring new customers is one of the most important goals for businesses. To achieve this, companies have to invest in customer acquisition campaigns. The purpose of this business proposal is to develop an acquisition strategy to increase the platform’s subscriber base.
Introduction
In the UK market, Disney+ UK is a relatively new distribution channel. The Disney-owned streaming service offers a diverse selection of Disney-branded movies and television episodes, as well as content from Star Wars, Marvel, and National Geographic (Disney Plus, n.d.). Since its launch in March 2020, Disney+ UK has gained a substantial number of subscribers (The Guardian, 2020). This business proposal aims to launch an acquisition campaign to increase the platform’s subscriber base.
The objective of the campaign is to collect and analyze data, segment the target audience, map out the customer journey, and measure and test the campaign’s effectiveness. Hence, with the rising competition in the streaming industry, Disney+ UK needs to launch an acquisition campaign to attract more subscribers.
Objective and Rationale
The objective of this campaign is to increase Disney+ UK’s subscriber base through social media engagement across YouTube, Facebook, Instagram, and TikTok. Over the last several years, the use of social media has been rising, and as user activity has increased, companies have demonstrated enhanced customer acquisition (Du et al., 2019). This will not only generate more revenue for the platform but also increase customer engagement with the brand (Quesenberry, 2020). To achieve this objective, the company will implement several strategic direct marketing initiatives to create a more personalized and effective campaign.
The primary objective is to collect and analyze the company’s social media presence. By collecting data on the existing subscribers, Disney Plus UK can gain valuable insights into their demographics, preferences, and behavior. This will enable the organization to identify the target audience most likely to subscribe to the platform and tailor its marketing efforts to appeal to them (Snee & Hoerl, 2020).
The second objective is segmentation: once the target audience is identified, it can be segmented into smaller groups based on their characteristics and preferences, which is optimal for targeted, personalized marketing messages. The third objective is to map the customer journey, helping identify touchpoints and effectively reach and engage with the target audience. This will increase their likelihood of subscribing to the platform (Snee & Hoerl, 2020). The fourth objective is measurement and testing, and Disney+ will continuously measure and test the different elements of the campaign.
The success of the campaign will be measured not only by the number of new subscribers but also by the level of engagement and satisfaction among the existing subscribers. Table 3 shows the performance metrics for the customer acquisition campaign. The target is to reach 50 million impressions, 1 million click-throughs, and 500,000 sign-ups. The company expects to spend $0.50 per click and $7.40 per sign-up.
Strategic Approach
The strategic approach will focus on using social media tools to attract more customers to Disney+ UK. Social media platforms are essential tools for marketing in the digital age. Table 1 presents the most popular social media platforms and their respective monthly active user bases. According to Statista (2023), social platforms such as YouTube, Facebook, Instagram, and TikTok have billions of active users every month.
Disney+ can use this data to target the most popular platforms to reach a larger audience. The streaming service should, therefore, create social media accounts on platforms such as Facebook, Instagram, YouTube, and TikTok. The accounts should be interactive and engaging, with regular updates of new movies and TV shows. Disney Plus UK should also offer incentives, such as free trials or discounts, for signing up through social media.
Data
To meet the set objectives, we will use a data-driven approach that involves collecting data from various sources. A data-driven consumer acquisition concept requires a thorough understanding of various data sources, as well as the interpretation and cleansing of that information, before extracting valuable insights (Chatterjee, 2021). In this situation, the sources include social media platforms, Google Analytics, and customer feedback.
Businesses may use Google Analytics to analyze and identify patterns, such as which goods are selling and which are not, which are growing in popularity, and which areas of their services or products are most attractive to visitors (Forbes, 2022). By analyzing this data, the company will be able to identify target audiences and segment them by demographics, interests, and behaviors. Additionally, Disney+ UK will explore other data sources that may be useful for achieving our objectives.
Offer and Positioning
The offer and product positioning will be crucial aspects of the campaign. Disney+ UK will center its approach on key selling points, such as the variety of content available and its exclusive Disney content. Disney+ UK offers film downloads and multi-screen streaming (Disney, n.d.). However, it will also take into account other factors relevant to the target audience. The plan is to offer incentives to new subscribers and active users on social media, such as a free trial or discounted subscription rates.
Short and Long Term Value
Nevertheless, it is necessary to analyze both the short-term and long-term value of the campaign, as well as the associated expenses. Table 2 shows the estimated cost of the customer acquisition campaign for each marketing channel. Disney Plus will allocate the majority of its budget to Facebook and Instagram ads, as these platforms have the highest number of monthly active users. To reach a wider audience across different age ranges, the company will consider additional platforms, such as TikTok and YouTube. Overall, the total estimated expenses are $3,700,000.
Calculating customer lifetime value (CLTV) and net present value (NPV) will be an essential part of the strategy. By doing so, Disney Plus UK will be able to justify the campaign’s financials and ensure its long-term sustainability. First, Customer Lifetime Value (CLTV) is the estimated value a customer will bring to a business over their lifetime (Sprott & Hollebeek, 2019). It is calculated by multiplying the revenue generated by a customer by the expected number of years they will remain a customer (Rogers & Peppers, 2022).
The CLTV formula is as follows: CLTV = (Average Order Value x Number of Repeat Transactions x Average Customer Lifespan) (Bygrave & Zacharakis, 2019). Using the data from Disney+’s customer acquisition campaign proposal, the CLTV of a new customer can be estimated. For this case, it will be assumed that the average order value is $10, the number of repeat transactions is 10, and the average customer lifespan is 5 years. Therefore, the estimated CLTV of a new Disney+ customer is $500:
CLTV = ($10 x 10 x 5) = $500.
Then another calculation to consider for such a campaign is the net present value (NPV). NPV is the difference between the present value of cash inflows and the present value of cash outflows over a period of time (Franklin et al., 2019). It is used to determine the profitability of an investment or project. The NPV formula is as follows: NPV = (Cash Inflows / (1 + Discount Rate)^t) – Initial Investment (Kimmel et al., 2020).
Based on the data from Disney+’s proposal, the campaign’s NPV can be estimated. It is assumed that the initial investment is $3,700,000, the discount rate is 10%, and the campaign runs for 5 years. First, estimate the cash inflows associated with the campaign. If each new customer generates $500 in lifetime revenue, the campaign is expected to attract 500,000 new customers.
Cash Inflows = $500 x 500,000 = $250,000,000.
Next, we need to calculate the NPV of the cash inflows over the five years.
NPV = ($250,000,000 / (1 + 0.10)^5) – $3,700,000.
NPV = $85,124,695.43.
Therefore, the estimated NPV of the Disney Plus social media customer acquisition campaign proposal is $85,124,695.43.
Consequently, when comparing the costs and benefits of the given campaign, it is evident that the benefits outweigh the expenses. First, it will be possible to increase Disney+ UK subscriptions and acquire new subscribers. The high number of clicks and impressions generated by the campaign translates into higher subscriptions (Esiyok, 2020).
Then the social media campaign can help increase brand awareness for Disney+. The campaign is expected to generate a high number of impressions across various platforms, thereby increasing the brand’s visibility. Ultimately, the success of the social media campaign will enable Disney+ to capture a larger share of the streaming market. The high number of subscriptions and brand awareness will help the business to compete effectively with other streaming platforms (Hochstein et al., 2021).
Conclusion
Overall, Disney+ UK will benefit significantly from social media involvement, as it will help the platform reach its target audience. Therefore, due to the increased rivalry in streaming, Disney+ UK has to initiate a customer acquisition strategy to attract new subscribers. This campaign aims to increase Disney+ UK membership by leveraging social media interactions across YouTube, Facebook, Instagram, and TikTok. The primary selling points of Disney+ UK’s services, such as the range of content and Disney-exclusive content, will be the focus of the company’s strategy.
Reference List
Chatterjee, P. (2021) Analytics in the age of artificial intelligence: The why and the how of using analytics to unleash the power of artificial intelligence. Atlantic Publishing Company.
Disney. (n.d.). Introducing Disney Plus.
Disney Plus. (n.d.) About Disney+.
Du, H. S., Ke, X., He, W., Chu, S. K., & Wagner, C. (2019) ‘Achieving mobile social media popularity to enhance customer acquisition: Cases from P2P lending firms’, Internet Research, 29(6), pp. 1386-1409.
Esiyok, E. (2020) Handbook of research on new media applications in public relations and advertising. IGI Global.
Forbes. (2022). Google analytics for businesses and how to use it.
Franklin, M., Cooper, D., and Graybeal, P. (2019) Principles of accounting (2nd ed.). 12th Media Services.
Hochstein, B. W., Hartline, M., and Ferrell, O. C. (2021) Marketing strategy. Cengage Learning.
Kimmel, P. D., Mitchell, J. E., and Weygandt, J. J. (2020) Accounting principles. Wiley.
Quesenberry, K. A. (2020) Social media strategy: Marketing, advertising, and public relations in the consumer revolution. Rowman & Littlefield Publishers.
Rogers, M., and Peppers, D. (2022) Managing customer experience and relationships: A strategic framework. Wiley.
Snee, R. D., and Hoerl, R. W. (2020) Statistical thinking: Improving business performance. Wiley.
Sprott, D. E., and Hollebeek, L. D. (2019) Handbook of research on customer engagement. Edward Elgar Publishing.
Statista. (2023) Most popular social networks worldwide as of January 2023, ranked by number of monthly active users.
The Guardian. (2020) Disney+ streaming service to launch earlier in UK on 24 March.
Appendix
Table 1: Monthly Active Users of Social Media Platforms. (Source: Statista, 2023).
Table 2: Customer Acquisition Budget.
Table 3: Campaign Performance Metrics.