(Welcome to the Entertainment Strategy Guy, a newsletter on the entertainment industry and business strategy. I write a weekly Streaming Ratings Report and a bi-weekly strategy column, along with occasional deep dives into other topics, like today’s article. Please subscribe.)
As I wrote earlier this week, Marvel Studios and the MCU are definitely in a downward slide (though that slide probably isn’t as severe as much of the media coverage makes it out to be). As a result, a ton of pundits, reporters and commentators have offered their explanations as to why. And with a few exceptions, almost everyone has sort of come to the same explanation(s):
- There’s too much MCU!
- And thus quality is down/audiences are burnt out.
Herding around one explanation is often too simplistic. I agree that there’s “too much MCU”, but nothing is ever mono-causal. I mean, loyal readers might remember that, last year, I listed off my explanations and I had to make a whole blame pie to explain it:
It seems like the media really struggles to describe anything with multiple causes. Someone argues “The MCU is struggling because of [Issue X].” Then someone else says, “Actually [Issue Y] is happening, so [Issue X] didn’t cause it.” In reality, both could have had an effect! And it only get more complicated as you add in more and more factors.
And thus, today, it’s time for my take on the MCU’s struggles, a sequel to last year’s article on the same topic. I’m revisiting my blame pie, starting with two new problems for the MCU, updating some others, and retracting/minimizing two other explanations from last year.
(Readers seemed to really like my Marvel article from Tuesday, so I’m sending this out in lieu of this week’s Streaming Ratings Report, which will be coming next week, including my take on Netflix’s big data release, mainly looking at what new info we can and can’t get from this list.)
New Issues for the MCU
Let’s start with two issues I should have emphasized last year, especially since Kevin Feige and Marvel Studios can’t do anything about the first two.
10% – The MCU’s Disney+ Problem
The Disney corporation has made some decisions that have put headwinds in the MCU’s path, including perhaps the biggest omission in last year’s blame pie:
Disney+ is cannibalizing the MCU’s theatrical audience.
Right now, a huge percentage of Marvel Studio’s box office problems comes down to the fact that everyone knows that they can just wait to see MCU films on Disney+ within two or three months. At points in 2022—when the theatrical business was alive and well—some MCU films came out within six weeks of the theatrical release, like Dr. Strange 2 coming to Disney+ on 22-Jun, after debuting on 6-May. The Disney corporation has trained audiences not to see their films in theaters, sacrificing long term box office for short-to-medium term subscriber gains.
Now, unless a film looks absolutely amazing and must-see-in-theaters, a lot of former movie-goers are just staying home. To echo Sonny Bunch from a few weeks ago, I can’t tell you how many people have told me, “Eh, I’ll wait for it to come out on Disney+.”
In my data look, I made this rolling average for MCU box office, and here’s that updated with Disney+’s launch, the start of Covid-19, and our next potential explanation for the MCU’s troubles, Disney’s high profile battle with Florida/DeSantis:
Here’s that without the average, just the total box office numbers:
As I wrote last year, strategically, I think Disney made a mistake here. Films are more popular if they go to theaters—check out my big ‘ol data analysis on this—and Disney’s value proposition depends on big blockbusters (Marvel movies, Star Wars, animated films) going to theaters and becoming huge, then monetizing those properties throughout their value chain. By sending their blockbusters to Disney+ so quickly, it undercuts that whole value chain, and the streaming upside just isn’t there.
As for why this explanation isn’t worth more than 10%? Well, it doesn’t quite fit the graph well. (Neither does Covid-19, nor the next potential issue.) Frankly, it’s tough in real life to perfectly fit an explanation onto a noisy data set like this.
An Aside: What About Politics?
Famously, just a year and half ago Bob Chapek/the Disney Corporation and Ron DeSantis got in a giant political fight, which led to outrage on Fox News on other conservative media. And many conservatives are also angry about “diversity”.
Is this affecting Disney? I don’t know. I don’t like writing about politics, because politics are divisive, and just writing this might upset some of my readers. (Again, because politics are divisive.) I’ve also written before that most customers tend to be apolitical in their media consumption. What does the data say?
Again, look at the two charts above. In this case, after the DeSantis-Disney fight, Disney still went on to launch Doctor Strange 2, Thor 4, and Black Panther 2 but the TV show viewership started to slide with Ms. Marvel and She-Hulk, so it’s hard to find a distinct relationship (though both sides will try).
Here’s the thing about mixing business analysis with politics: it confuses ethics (doing the right thing) with the bottomline, and I don’t want to tell people not to do the right thing to make more money.
(Being realistic, if a company is known as a “Democrat” company and that lowers viewership by even 5 or 10%, that’s enough to hurt profitability. But again, this is balancing earning a profit with doing the right thing.)
That said, even Bob Iger recently said that creatives at Disney need to focus less on messages and more on telling a good story, so let’s talk about that instead!
25% – The MCU Quality is Down (The Movies Aren’t as Good/Fun)
A number of critics/pundits have mentioned that MCU films aren’t as good recently, and I agree. (I briefly mentioned this last year in my section on “Too Much MCU” but I’m expanding it today. The data seems much clearer now.) I don’t really care about the critical consensus, but what customers think. As I showed yesterday, it’s evident in both Cinemascores and IMDb ratings: the MCU films are on a downward slide.
So let’s combine that with the previous charts (which results in one on my favorite graphs of the year):
The rest of this article is for paid subscribers of the Entertainment Strategy Guy, so please subscribe. We can only keep doing this great work with your support.
