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‘Frozen’ Mania Helping Disney Stores Outpace Retail Industry

Photographer: Cindy Ord/Getty Images for FELD Entertainment

Memorabilia on display at Disney On Ice presents Frozen at Barclays Center on November 11, 2014 in New York City. Close

Memorabilia on display at Disney On Ice presents Frozen at Barclays Center on November... Read More

Memorabilia on display at Disney On Ice presents Frozen at Barclays Center on November 11, 2014 in New York City.

Walt Disney Co.’s (DIS) $4 billion consumer products arm is outpacing industry retail sales thanks to a focus on entertainment franchises such as “Frozen” and “Doc McStuffins,” the head of the division said.

Profit at Disney’s consumer products unit rose 22 percent to a record $1.36 billion for the fiscal year that ended Sept. 27. The company is maintaining that momentum and posting strong results this holiday season, said Robert Chapek, who heads the division, although he declined to give any specific numbers.

“It seems that everything quite honestly is on fire,” Chapek said in an interview. “Whether you’re talking ‘Frozen,’ whether you’re talking Marvel, whether you’re talking any of the Disney Channel properties, everything is doing very, very well.”

Merchants have posted mixed results this holiday season, with the Washington-based National Retail Federation reporting that sales fell 11 percent over the crucial Thanksgiving weekend. Chapek credits Disney’s performance to its strong character line-up as well as a redesign of its stores to focus on movie-themed areas such as “Planes: Fire & Rescue” and “Frozen,” rather than on categories of merchandise.

“That’s the way the consumer shops,” Chapek said. “They don’t go looking for bedsheets. They go looking for something that’s ‘Frozen’ and then find bedsheets.”

Burbank, California-based Disney licenses merchandise in 137 categories to makers of some 1.6 million products, Chapek said. Licensees range from Hasbro Inc. (HAS) toys to Naturipe Farms LLC fruit snacks. The company operates 328 Disney stores around the world.

Disney’s retail strategy has shifted direction a few times. It sold its North American locations in 2004 to Children’s Place Retail Stores Inc., before buying them back four years later. Stores now have theaters showing Disney cartoons and castles with mirrors inside where kids can try on attire such as the blue Queen Elsa dress from “Frozen.”

“Everyone’s buying everything,” Chapek said of the “Frozen” products.

To contact the reporter on this story: Christopher Palmeri in Los Angeles at cpalmeri1@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net James Callan, Nick Turner

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