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Listening to Customers Accelerates New Product Adoption, Driving Growth

Walt Disney Studios Home Entertainment

Through Communispace, parents and movie fans help Disney understand how to overcome barriers and encourage Blu-ray technology adoption.

A challenge for the entertainment industry

The new millennium marked a paradigm shift for movie studios. DVD technology moved to mass acceptance, and families began upgrading their VHS collections for the obvious advantages that DVD offered. For movie studios, home entertainment sales became an increasingly important component of revenues … but when DVD sales began to plateau in 2007, many in the industry were actively wondering, “What’s next?”

In early 2008, after battling HD-DVD for consumer acceptance, Blu-ray won out as the new high-definition format. Disney had made an early commitment to the Blu-ray format, believing in its quality over HD-DVD. 

With the winner decided, Disney began aligning its product and marketing efforts firmly behind the format. However, feedback from WDSHE’s private Communispace communities and other sources revealed that real barriers existed to mass understanding and adoption of this high-def upgrade. Disney knew they had to get it right, or risk losing revenue and alienating their core family base.

Understanding the Technology Adoption Mindset

Disney’s senior executives were debating some key questions: “Why do some households with a Blu-ray compatible device still buy DVDs?” “How do we best communicate the benefits of Blu-ray over DVD?”

Together with three private online communities (500 members each of family, early adopters and general entertainment consumers) created with Communispace, WDSHE set out to understand consumer perceptions and barriers to Blu-ray adoption, and to refine products and messaging cues to better resonate and encourage faster adoption.

Through a series of iterative activities, WDSHE researchers and marketers worked with community members to chip away at these big questions and others. Resulting insights were used to inform product strategy for movie title SKUs, Blu-ray education efforts, messaging and advertising, and more.

For example, it became clear early on that one of the biggest benefits of Blu-ray disc players – the capability to also play existing DVD collections – was lost on many consumers. These families had just spent years upgrading their VHS collection to DVD. The idea of “starting all over again” was so daunting that purchasing a Blu-ray player didn’t even enter their consideration set. Upon learning this, backwards compatibility was highlighted more prominently and clearly in Disney’s general Blu-ray messaging.

In another example, WDSHE discovered that one of the biggest barriers to Blu-ray movie purchasing among enabled households was the lack of “portability” beyond the living room. Particularly for Disney’s core family titles, being able to watch a given movie in non-enabled locations, like the kids’ bedroom or the car, is a strong consideration in the consumer purchase decision. Recognizing this, Disney created the industry’s first Blu-ray “Combo Pack” – a Blu-ray disc release that also includes a standard DVD version of the movie. Combo packs went on to be an important sales driver for Walt Disney Studios Home Entertainment, as well as a vehicle to increase Blu-ray adoption.

To further Disney’s understanding, members of the communities created and uploaded their own video “commercials” for the Blu-ray Combo Packs, helping Disney hear members talk about them in their own words. Witnessing the expressions, language, key themes and tone of these member-created ads informed advertising and messaging for future movie releases. Member input was also used to help directly refine elements like educational DVD trailers about the benefits of Blu-ray, educational pamphlets and Blu-ray title package designs.

Helping consumers to “cross the chasm”

These rich verbatims and insights into the consumer mindset allowed WDSHE to hone its Blu-ray strategy with confidence, leading the way among movie studios. After the success of its first Blu-ray Combo Pack for Sleeping Beauty in late 2008, Disney committed to releasing Combo Packs for all of its major home entertainment releases in 2009 (and later continued into 2010). Other studios eventually recognized the successful model and began releasing their own versions of Blu-ray/DVD Combo Packs for key titles, leading even more new households to adopt Blu-ray players.

For Disney, Blu-ray sales have become an increasingly large and important component of their distribution strategy. According to CEO Bob Iger, 68% of the revenue from last year’s six-week sell-through window re-release of Snow White and the Seven Dwarfs was attributed to Blu-ray (Combo Packs), which Iger characterized as “a huge number” and made the title the No. 1 Blu-ray release in 2009 [1]. And in June of 2010, in a further sign that Blu-ray disc is going mainstream, 37% of first-week sales of Tim Burton’s Alice in Wonderland came from the high-definition (Combo Pack) disc version, an unusually high percentage for a family title [2].

Overall, Blu-ray disc shipments topped 77 million units in the first half of 2010, nearly double the number of the comparable period in 2009, according to figures compiled by Swicker & Associates on behalf of the Digital Entertainment Group. And Blu-ray sell-through increased 84% year-over-year to $733 million during the half. In a few short years, household penetration of all Blu-ray compatible devices, including set-top players, PC drives and PlayStation 3 consoles, has now reached 19.4 million U.S. homes [3].

“Our communities have given us a growing intuition for the consumer state of mind on these issues,” says Susan Petoyan, Executive Director of Worldwide Consumer Strategic Intelligence for WDSHE. “Members are letting us into their homes, sharing their view of the home entertainment experience and walking us through their decision processes. It’s allowed us to keep the consumer at the forefront as we make business decisions and continue to evolve our movie distribution strategy.”


  1. http://www.homemediamagazine.com/disney/dvd-stages-comeback-disney-studio-posts-q1-income-surge-18393 (2/9/10)
  2. http://www.homemediamagazine.com/research/alice-tops-sales-wolfman-tops-rentals-19677 (6/9/10)
  3. http://mesalliance.org/blog/2010/07/19/digital-distribution-edges-blu-ray-in-first-half (7/19/10)