As DeSantis campaigns, Disney sees a long road ahead

As Florida Gov. Ron DeSantis begins his presidential run, one of the main pillars of his message is “holding awakened corporations accountable,” as a fundraising email put it Tuesday. And to quell that sentiment, he has railed against one target at nearly every campaign stop: Disney.

“We put this company on a pedestal — in the past it was just like the all-American company,” Mr. DeSantis said at a New Hampshire town hall last week. “But they’ve really embraced the idea of ​​getting the sexualized content into the early childhood programs. And that’s just a line I’m not willing to cross.”

It’s a theme he echoed at recent rallies in South Carolina, Oklahoma and Iowa, alongside his claim that Disney is trying to “rob our kids of their innocence.”

The two sides have been at odds since last year, with Mr. DeSantis boasting in speeches and on a book tour about how he chastised the company for opposing a controversial education bill that opponents labeled “Don’t Say Gay.”

Despite the partisan attacks, Disney remains one of the strongest brands in the world. But cracks in its public reputation are visible, and the company now faces the uncomfortable possibility of being attacked by Mr. DeSantis for at least another year. The Republican presidential primaries run until July 2024.

That’s an eternity for Disney, which has spent 100 years diligently trying to avoid political and cultural pitfalls for fear of tarnishing its happily ever after brand. In theory, Disney’s family-friendly movies, TV shows, and theme park rides are aimed at everyone. The last thing it wants is for Mickey Mouse to be dragged through the mud of the presidential campaign.

“If you have a blue brand or a red brand, you have less of a brand either way,” says John Gerzema, CEO of the Harris Poll and former brand consultant. The latest ranking from the Axios Harris Poll, published in May and based on surveys of 16,310 people, placed Disney at number 77, up from number 7 in 2017.

How to deal with Mr. DeSantis’ inflammatory claims has been a topic of debate among Disney executives. In April, Robert A. Iger, Disney’s CEO, attacked Mr. DeSantis as “anti-business” and “anti-Florida” for his actions against the company, but has not commented publicly on the matter since May 10. issue stated. (Mr. Iger declined an interview request for this article.) Hitting back at Mr. DeSantis now would most likely make the situation worse. A recent Reuters/Ipsos poll found that half of Americans don’t pay enough attention to the struggle to have a fully formed opinion. Why risk more headlines?

Unless visitor numbers to the company’s theme parks start to drop drastically — no sign so far — there’s no reason to worry about Disney’s overall business, analysts said.

But the political struggle has had an effect. The Axios Harris Poll ranked Disney as the fifth most polarizing brand in America; the company had been close to neutral in 2021. “Disney’s intangible value, perception of trust, citizenship, ethics and growth (a measure of its future potential and relevance in my life) are declining the fastest,” Mr Gerzema said in an email.

Privately, Disney executives are poking holes in polls that showed brand erosion. At the same time, they have taken steps to protect the company’s reputation. In April, Mr. Iger Asad Ayaz to become the company’s first-ever chief brand officer, saying he will be responsible for “managing and elevating the Disney brand globally.”

The company also pressured Mr. DeSantis in subtle ways.

For example, Mr. Iger was photographed with California Governor Gavin Newsom at Disneyland on June 13. Mr Newsom was there to discuss an expansion plan that would create thousands of jobs. It was a reminder to Mr. DeSantis that Disney had shut down a project in Florida. Mr. Newsom also attended Disneyland’s first-ever Pride Nite, where he posed for photos with visitors outfitted with rainbow Mickey Mouse ears.

Part of Disney’s challenge involves the soundbite nature of the campaign track. Mr. DeSantis likes to say that Disney is in favor of “child sexualization.” Those words are making their way onto local news outlets and social media platforms.

When it joined more than 200 other companies against Florida’s education law, Disney said it did so because the statute “could be used to unfairly attack gay, lesbian, non-binary and transgender children and families. ” That is far from being in favor of sexualizing children.

In a recent television ad that aired in Iowa and South Carolina, the main super PAC backing Mr. DeSantis falsely suggested that the company was covertly brainwashing children. “Once upon a time, Disney movies were for kids, no secret sexual content,” the ad’s narrator says ominously.

Disney executives have watched in horror as Mr. DeSantis’ attacks spread. “DeSantis and Trump spar over who else Disney hates,” headlined The Orlando Sentinel on May 30.

A group of protesters, some with Nazi symbols and others with DeSantis campaign signs, gathered outside Disney World’s entrance a few weeks ago to garner national attention. “Oh my god, Mickey is trending in video next to swastikas,” a dismayed Disney executive in Orlando texted a reporter that day.

Mr. Iger is also facing adverse business developments, including poor box office results, an ongoing screenwriters’ strike and the departure of Disney’s chief financial officer. Investors are getting jittery: Disney shares are trading at about $89, down 7 percent from a year ago and 55 percent from their peak in March 2021.

Disney’s profit engine of the past 30 years — traditional television, including ESPN — has become a shadow of its former self, the result of cable-cutting, weak advertising and rising costs for sports programming. Mr. Iger is betting that streaming will help the business grow again. But Disney+ has lost subscribers and a broader streaming division remains unprofitable, losing nearly $2 billion since the start of the fiscal year.

Disney is running a campaign to save $5.5. billion in costs across the company. That means cutting 7,000 jobs, about 4 percent of the global total, including notable layoffs at Pixar and ESPN.

Another headache file: Mr. Iger’s contract expires at the end of 2024. Who will take over? So far it’s a mystery.

Mr. Iger, 72, is said to be sailing in retired bliss by now. He ended his first run at Disney in 2021, handing over the reins of the company to Bob Chapek, a former theme park executive. Mr. Chapek was fired in November and Mr. Iger returned as CEO.

Mr. Chapek’s successes have been overshadowed by missteps – one of the biggest was his response to the Florida education bill. Among other things, it prohibits discussing sexual orientation and gender identity in class through third grade and limits it to older students. (Florida has since extended the ban to all classes.)

Initially, Mr. Chapek tried not to take sides, which led to a workers’ revolt. He then denounced the law, which angered Mr. DeSantis and led to the fight Disney is still dealing with.

Mr. DeSantis wanted to limit the autonomy that allowed Disney to oversee its Disney World resort. The company worked quietly to sidestep the effort, surprising the governor. In April, Mr. DeSantis back — and so did Disney, suing the governor in federal court, pulling the plug on a $1 billion project in Florida and saying another $17 billion in Disney World expansion spending was at risk.

Disney’s lawsuit is progressing, but a resolution will likely take years. Meanwhile, the political crossfire continues.

On Tuesday, Disney filed paperwork in a federal court to propose a start date for a trial in the lawsuit against Mr. DeSantis: July 15, 2024, the day the Republican National Convention begins.

Nicholas Nehamas reporting contributed.

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