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8 Pages   |   2,258 Words



Table of Contents
Statement of the Problem.. 3
Analysis of the causes of the problem.. 3
Strengths. 4
Weaknesses. 5
Opportunities. 5
Threats. 6
Decision Criteria and Alternative Solutions. 6
Recommended Solutions, Implementation and Justification. 6
Bibliography. 8

Statement of the Problem

The major problem facing Marvel Corporation is with regard to its distribution of products. Most of its products did not occupy the leading retail spot especially in the direct market stores as a result of which its products were not managed efficiently as the other mass retailers. Another disturbing factor is the ignorance and fewer attempts towards building a market where new customers could be targeted.
Second, Marvel faces the problem of losing market share due to change of consumer tastes whereby people might resort to substitutable entertainment forms when they lose interest in Marvel’s creations.
Third, it encounters the dilemma of how to transfer resources towards promotion of less acknowledged characters after the demise of the previous famous ones.
Another major crisis is the decision on whether to undertake capital intensive projects or not? Are such projects worth taking a risk or not? Should such projects be licensed out, contracted out or should Marvel Enterprise themselves undertake such a task with such a huge responsibility? And most importantly which way is most suitable for the launch of their new product that is should it be in the form of a film, video game, television, home video or the internet.
Last of all Marvel’s profitability is of great concern. Over the years its profit has declined considerably. With regard to its publishing division its gross profit for both the Amazing Spider Man and the Punisher declined considerably from July’03 till December’03.

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Analysis of the causes of the problem

By considering the multitude problems that Marvel Enterprises faced, it was essential to carry out a detailed analysis of how the company was operating while considering the case for the year under consideration.
To analyze the company’s operations a SWOT analysis yielding the appropriate results pertaining to the Enterprise was of importance, hence the following information obtained from within the case was examined and evaluated.
Initially profits increased significantly for Spider Man sales in the month of July and August’03 from $149,000 to $155,900 however thereafter it fell. Similarly the profits from sales of Punisher rose from July till September but afterwards it subsequently fell.
Its overall performance with respect to Net Income earned too declined severely in 2004 compared to 2003. This is a grave issue which can seriously hinder and adversely affect the company’s growth potential if measures to curb it are not taken.


The most basic strength of the enterprise lies with the classic superheroes that they offer as entertainment to their audience. These superheroes and their tales pose as stars for the company and thus maintain the level of reputation for the firm.
Throughout the years Marvel has worked hard to instill the images of these classic superheroes into the minds of the young children so much so that each generation throughout the years has been able to share the same superheroes throughout the ages.
Moreover, the tale of Spiderman has helped the company earn more. Spiderman has eventually proved itself to be the cash cow for the enterprise as it has shown a remarkable potential for attracting the minds of the children and the old generation as well with the superhero that he possesses and the form of entertainment that it tends to provide, not only in the form of comic books but also in the form of a movie with sequels forecasting another year of profitability for Marvel Enterprises as indicated in the case by the following words.
Spider Man’s career over the next five years is going to include two more movies, DVDs, toys, a video game, a promotion with Burger King, and so on.”
This shows the extent to which Spider Man has been promoted in order to induce this level of demand pertaining to just this one character, hence showing the importance of Spider Man to the Enterprise and the significance it holds while being a cash cow.
In addition to this Marvel is an established company that has been able to learn from its mistakes and has been able to keep up with the demands of the consumers. This establishment of such a large organization has benefitted the company as it tends to stabilize the reputation of the organization effectively and helps maintain the relative importance it holds in the lives of its consumers. This stability is an essential strength for Marvel Enterprises against its upcoming competitors.
Moreover, the company has been able to expand and has been able to incorporate the new changes that it has to face so as to entertain the consumers and to keep them loyal to the Enterprise. We can observe this fact by looking at how the company was able to re-establish itself after its bankruptcy following a few major changes in its management and the way they started handling the division of the organization which the case quotes it to be as:
 “The new team describes the revamped company as a “mini-conglomerate” with three division: comic-book publishing, toys, and licensing”.
Furthermore, another potential remarkable strength of the company lies in the way it has been able to manage its quality of its products and the entertainment it offers to its consumers throughout the ages. This remarkable feature is also one of its core strengths as it has helped maintain the stability of the company and the reputation that it still continues to foster amongst the growing generation.
Due to the above mentioned factors, Marvel was able to effectively increase its sales and improve its financial position in the market and was able to earn profits by focusing on the cash cow of the organization-Spider Man. The sales figure as reported in the case rose substantially due to the level of profits that were being contributed by the Spider Man movie release, contributing about 10% towards the net revenue of the company.


The weaknesses that were reported in the case were as such that the company was unable to foster to the type of entertainment that the new generation now wanted. It just simply focused on its classic heroes to help make the company make it through to the next year and the one after that so with the release of the Spider Man movies.
By simply focusing their attention on Spider Man they failed to incorporate new segments into their company which would enhance the reputation and the performance of the company by enabling them to understand what the consumers now wanted as compared to that of the previous generation that they were targeting.
Another major weakness of the company was that it was not investing enough capital into the business and was relying solely on the retained earnings that they were able to reap through Spider Man with the management solely focusing on characters that would reap benefits without minimal capital investment being made on their part. This is a major weakness of the organization as capital investment induces more profitable returns and tends to expand the business more.
In addition to this, another form of weakness for the company is its inability to set up its distribution spots effectively which would have helped the company to target its customers effectively.
This inability to set up its distribution spots where consumers would be attracted to purchase their products shows the ineffectiveness on part of the company to cope with the management and operations of its organization.


An opportunity for the company lies in the way they are able to effectively target their customers with better distribution spots set up by them.
They should also set benchmarks against their opposing competitors and should evaluate their strategies as well to see what it is that the customers like more about them. This would then help them analyze the fact that in order to stay in the competition they need to focus on introducing more characters and need to promote them extensively and effectively so as to reap better profits.
Moreover they also need to analyze the fact that by investing capital Marvel would be able to bring in more talent into their organization thus enabling them to better perform in the market. Thus they can benefit from this opportunity and can then further expand their production and distribution effectively.


The most major threat that Marvel faces is that of new forms of entertainment. This has led to serious decreases in the level of profits for the company. The form of entertainment that thecustomers now want has changed and the fact that Marvel has been unable to incorporate such changes into their management show their ineffectiveness to conform to the changing environment.
Another potential threat that the company also faces is that of other organizations like Marvel itself working in the same direction as well. The name that first springs up when considering the competition that Marvel has is that of DC comics which is also reaping profits and has shown a potential to incorporate the new changes that the market now wants.
Hence, these threats even though few are great in the way they impact the profitability of the company because, the changing trend of the consumers and the competition they face from their customers would then negatively impact the organization.

Decision Criteria and Alternative Solutions

The decision that we can come to when evaluating the case can be summarized as such that the company has to focus on the weaknesses and the threats that they face as they may be few but their impact is quite strong. The following factors sum up the factors contributing towards the difficulties that the company faces:
  • Minimal investment of capital
  • Ineffective distribution spots
  • Inability to conform to the changing trends and entertainment needs of the customers.
Hence this helps us narrow down the majorproblems being faced by the organization and helps us then focus on the strategy that needs to be taken by the company and the alternative solutions that can be presented in order to fully support the operations and management of the company in such an environment.
The solutions that can be presented for the company is such that while considering the extent of the financial position of the company, we can conclude that the finances of the company can be used for either of the two strategies to be implemented:

Solution 1:

The company can use its capital and expand their form of production and can invest in new products. They can focus on those activities that require a moderate level of capital investment and also promise better returns when compared to the returns they were making from those projects that requireda minimal level of capital.
Hence such a strategy can in effect help the company expand its operations and also conform to the changing trends of the market.

Solution 2:

An alternative solution is that the company can use its finances to re-locate their distribution spots where there is a potential for them to earn more revenues by continuing to focus on the classic superheroes that are their stars.
Distribution spots are also an effective way of promoting their existing products so this can then help their profitability.
Therefore, when evaluating the two solution, solution 1 seems to be more feasible as it would help the company conform to the new changing trends and can earn more revenues through this strategy.

Recommended Solutions, Implementation and Justification

The tribulations faced by Marvel can be solved through a strategic approach. With regard to its distribution of product problem it should use other sources to make its products available other than the direct market approach where it has to comply with the decision of the owner such as by opening up its own retail store where it could place the products at an spot in the store it wants to such that it attracts the customer directly.
Secondly it could distribute its products by direct mail, e-mails, and mail-order catalogues or through telephone sales. These methods are especially advantageous and appealing with respect to their cost-effectiveness approach. Third, it might even resort to wholesalers to sell its products to retailers. This would result in less transportation costs as now journeys would only have to be made to a few wholesalers rather than to several retailers.
The problem of targeting new customers can easily be met by Marvel by offering exclusive deals and discounts which catches the attention of first-time users such as buy one get one free or it could introduce certain complimentary goods for its products for example if a certain person is a loyal customer of yours then Marvel Enterprise could offer free video games or free cinema tickets to view their new film or movie.
It could even hold open days where customers can get a chance to wander in the company’s premises and see the type of services and products they offer.
Another major problem is the risk the company faces at all times associated with the fear of losing customers, of launching a new product and from competitors.
In order to overcome these problems Marvel should indulge in a risk analysis whereby it should identify the threats facing it. At all times in order to compete with competitors it should advance rapidly by means of technology and by using creative innovations in its ideas.


Elberse, A. Marvel Enterprises, Inc

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