Disney's former Director of Corporate Synergy, Lorraine Santoli, gives a first-person, behind-the-scenes account of how she and her colleagues spearheaded Disney's financial and cultural recovery during the Michael Eisner and Frank Wells era.
When Santoli left NBC to join the Disney team, the studio that Walt built was in a rut. Its leadership was weak, its films forgettable. The arrival of Eisner and Wells brought revolutionary change to how the company operated and, more important, how it marketed its products. The word of the day: synergy.
In Inside the Disney Marketing Machine, Santoli shows you what it was like to reshape a faltering company into today's media juggernaut. Her enlightening anecdotes and stories, along with exclusive contributions from senior Disney management, include:
Peek inside the world's most powerful marketing machine and see how Disney really makes its magic!
Part One: Marketing Outside the Company
Chapter 1: Hello, Disney!
Chapter 2: Marketing is Everything and Everything is Marketing
Chapter 3: The Happiest Place on Earth
Chapter 4: Donald and His Flock
Chapter 5: Eisner and Wells Invade the Magic Kingdoms
Chapter 6: Marketing an Unlikely Anniversary
Chapter 7: Cars, Cars, Cars
Chapter 8: Welcome, President Reagan
Chapter 9: Lindquist Strikes Again
Chapter 10: What’s Next?
Chapter 11: Mickey Celebrates his 60th
Chapter 12: Mickey’s 60th Marches On
Chapter 13: The Late Eighties and Beyond
Chapter 14: Muppetland
Chapter 15: Elizabeth Taylor and Lavender Fireworks
Part Two: Marketing Inside the Company
Chapter 16: The “S” Word
Chapter 17: The Big Picture View
Chapter 18: It Starts at the Top
Chapter 19: Disney Dimensions
Chapter 20: Communicate, Communicate, Communicate
Chapter 21: Educating the Company About the Company
Chapter 22: Establishing a Synergy Committee
Chapter 23: Synergy Communications Expand
Chapter 24: Planning Ahead
Chapter 25: The Day the Music Died
Chapter 26: Experiential Motivation
Chapter 27: The Synergy Landscape at Walt Disney World
Chapter 28: Synergy Goes Hi-Tech
Chapter 29: Results
I was Lorraine Santoli’s first boss and mentor. I am honored that she asked me to write the foreword to this book, not only because we met at the beginning of her career and have remained friends for so many years, but because I feel my experience as a former NBC-TV Marketing, Research, and Strategic Planning executive qualifies me to say that Inside the Disney Marketing Machine: In the Era of Michael Eisner and Frank Wells is an important business book.
It was 1968. I was manager of Marketing and Management Studies in the NBC Research Department. Since NBC was owned at that time by RCA, our office was located in NBC’s corporate headquarters in the RCA Building in Rockefeller Center in midtown Manhattan. We had a prestigious address: 30 Rockefeller Plaza—made famous now by the TV series 30 Rock.
My main job was to develop new ways to segment network television audiences for advertisers beyond the standard Nielsen ratings—in particular, by the product and brand usage characteristics of these audiences. While most people probably believe that NBC’s product is its programming, in point of fact its product is the audience its programming garners. The audience is then marketed to advertisers and their agencies.
I had arrived at NBC four years earlier after working for several years at arguably the most iconic advertising agency of that “Mad Men” era: Doyle Dane Bernbach. Just as Michael Eisner and Frank Wells were a perfect fit in their era of running The Walt Disney Company, the same was true at DDB: Ned Doyle ran account management, Maxwell Dane supervised the business side, and Bill Bernbach was the creative genius. My more humble job in DDB’s Research Department was to supervise strategic marketing research for the agency’s fast-growing and diverse roster of clients, which included Volkswagen, Polaroid, and American Airlines. Our analysis of one client, Avis Rent-A-Car, led to the development of their famous slogan, “We’re #2/We Try Harder”.
While working at Doyle Dane Bernbach, I also earned a Ph.D. in Economics at New York University. Shortly after obtaining my Ph.D., I secured the position in the NBC Research Department that I described previously. Against this background, in 1968 I needed a new secretary and interviewed several applicants—one of whom was Lorraine Santoli. She was barely out of her teens at that time. I don’t remember the interview now. But inasmuch as I hired her, I obviously was impressed by her and liked her as a person.
Who could have predicted back then that Lorraine over the next few decades would not only advance from secretary at NBC to corporate director at Disney, but, more importantly, that she would play a key role in developing a major new tool of marketing management: internal corporate marketing? Who knew?
I stayed at NBC for most of the remainder of my business career, moving on to become director of Research Projects and a few years later assuming the role of director of Economic Planning. I eventually retired from NBC after 25 years of service, then worked for a few years in investment banking, and finally packed it in permanently.
After Lorraine left NBC, moved to California, and began working at Disney, we kept in touch, and I followed with pleasure her advancing career. Then, when I fully retired, my wife, Cynthia, and I decided to move to southern California ourselves. We ended up residing not far from Lorraine’s location and became good personal friends. My connection with her had moved full circle.
As I said in the opening of this foreword, Lorraine Santoli’s Inside the Disney Marketing Machine: In the Era of Michael Eisner and Frank Wells is an important business book.
Primarily, this book provides a unique behind-the-scenes account of how The Walt Disney Company marketed its properties not only outside the company to consumers (Part One: Marketing Outside the Company), but in the mid-1980s launching and implementing an internal marketing program (Part Two: Marketing Inside the Company).
While Marketing Outside the Company provides significant insight into Disney’s approach, Marketing Inside the Company, was indeed unique to the Disney company during the Eisner and Wells years. The purpose of this program was to keep all divisions and business units of the vast Disney organization informed about what was going on around the company, and more importantly, to motivate cross-promotion of what they were all doing. The ultimate goal was to achieve synergy, where the sum of all these interactions by different divisions (in revenues and profits) would be greater than each division could achieve on its own. As Michael Eisner succinctly put it, with synergy “1+1=3”.
A prerequisite but no guarantee for achieving synergy within any large corporation is the support of top management. Certainly, Disney’s effort at attaining synergy had the full and enthusiastic support of CEO Michael Eisner and his able partner, Frank Wells, who was president and chief operating officer.
A Corporate Synergy Department, where Lorraine worked as a manager and then director, was set up to implement the synergy program. This entailed recruiting synergy representatives from all areas of Disney, developing databases of these contacts, creating a slate of internal communications, distributing calendars, building relationships across business segments, and more, to keep all marketing and key company executives aware of ongoing business activities throughout the company. She also set up working groups at different levels of management, and scheduled frequent meetings and events where participants could bond with each other. In the mid-1990s, when the internet was still in its infancy, Disney’s Corporate Synergy Department actually launched an intranet to communicate with synergy representatives. Nearly 1,000 Disney marketing, entertainment, and creative executives were in the synergy loop.
The challenging task that Disney’s Corporate Synergy Department faced was to motivate people around the company to get on the synergy bandwagon, when they of course did not report to Corporate Synergy. (This will increasingly become the norm in American business and industry, as organizational structures flatten and hierarchical chains-of-command disappear. Successful managers will have to lead teams of people who don’t report to them. Motivational and collegial skills—building relationships —will be the key to success.)
Lorraine discovered unusual ways to motivate her synergy contacts, one of which was through food. She had regular 9 am breakfast synergy meetings. Before the meetings food would be available—but not just the usual coffee and Danish pastries. She arranged lavish buffets of bagels and lox, juices, muffins, cereals, etc. Not surprisingly, everybody got to the meetings early and had a chance to bond with each other. They were also in a very good mood (although perhaps a couple of pounds heavier) when the meetings started. (This is the kind of practical lesson that you are not likely to learn at even the most advanced marketing seminar at the Harvard Business School.)
How much did the synergy program contribute to Disney’s bottom-line during the Eisner/Wells era (1984-1994)? This was a golden period when everything seemed to be going right for the company, and they made enormous amounts of money. Probably, quite substantial shares of the growth in revenues and profits can be attributed to the synergy program.
More important, perhaps, than monetary gains, the synergy program fostered teamwork and the bonding of people across the many business units of Disney.
Lorraine Santoli’s achievements are especially remarkable when you realize that she entered the business world in 1968. While opportunities were beginning to open up for women—especially in industries like advertising, media, and entertainment—it was not likely that a woman who started her career as a secretary would get much farther up the ladder. Almost invariably, women in the same jobs as men were paid less. Barriers to entry and advancement also blocked people from minority groups and with different sexual orientations.
It is painful now to think of how many bright, creative, and talented people with great potential never had the opportunity to realize that potential—and what a waste that was for American business and the entire economy.
In today’s increasingly competitive global economy—and with disruptive new technologies and business models shaking up established industries—companies need every competitive advantage they can get. We can no longer afford to squander what economists call our “human capital”.
I’ve discussed previously the flattening of corporate organizational structures, where successful managers will be working with teams of people who don’t report to them. Motivational, relationship-building skills will be the key to personal and business success. Women, in particular, are apt to have these needed skills. It is more vital than ever that they have the opportunity to realize their full potential. Lorraine rose to the occasion, and with her book Inside the Disney Marketing Machine: In the Era of Michael Eisner and Frank Wells, shares a marketing wisdom that should be required reading for marketers everywhere.
For years I’ve heard from people who wonder what it was like to be employed by The Walt Disney Company, especially from a marketing perspective since the organization has always been lauded for its genius in that discipline. Having worked inside the Disney marketing machine for over two decades, from 1978 to 2000, I decided to share my experiences through this book. It is part memoir, part “take-a-lesson”, and will provide a peek into what goes on behind the marketing doors of the Mouse House, specifically during my tenure.
Marketing is defined by the American Marketing Association as the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. It is an umbrella term under which advertising, publicity and promotions reside. My perspective in writing this book is derived from my personal experiences working in marketing positions both at The Walt Disney Studios in Burbank, California (home of Disney filmmaking and the global headquarters for The Walt Disney Company) and at the Disneyland Resort in Anaheim, California.
My Disney adventure started back in February 1978 when I relocated from New York City to Los Angeles on a whim after a decade-long career at NBC where I was headquartered at 30 Rock, an address quite well known today from the TV series of the same name. There, I worked my way up from secretary to Sam Tuchman, Ph.D., a TV research analysis executive (and my first mentor), to media analyst to camera person, becoming a crew member on such TV shows as The Today Show, Saturday Night Live, and an early Barbara Walters syndicated talk show called Not for Women Only.
But I was ready for a new adventure. I wanted to write for television, and Los Angeles was my target. Fortunately, I had an NBC co-worker, my good friend Suzy Hey, who was also ready for a change, so we packed up my car and headed west. Neither of us knew a soul in California. What we did know was that we both needed to get a job as quickly as possible once we arrived.
We settled in what was then the sleepy town of Burbank, renting a beautiful two-bedroom furnished apartment with a full spectrum of amenities including a pool, tennis courts, and game rooms. Having been born and bred in Brooklyn, New York, it was like I died and went to heaven. But to maintain my new L.A. lifestyle, job hunting was a number one priority.
Two weeks into my arrival I was well into applying for jobs all over town, mostly at TV stations. Then one day I came upon The Walt Disney Studios, also located in Burbank. Who knew? The only clue that this was Disney was a small sign affixed to chain link fence at the entry that read: Walt Disney Productions (the name was changed to The Walt Disney Company in 1986). Might as well put in an application there, too, I thought. I was hired that day.
Like most everyone, I grew up with Disney. I faithfully watched the Mickey Mouse Club as a child and I wanted to be a Mouseketeer. I was glued to the TV screen watching the weekly Disneyland show, especially enjoying Walt Disney’s glimpses into a new entertainment complex he was building in Anaheim, California, called Disneyland. And, of course, I enjoyed Disney animated and live-action films. While I was a Disney kid, I never specifically had my sights set on working for the company. But here I was, having been hired as an assistant in the market research area of the Publicity Department. I knew little about marketing, but what an education was ahead.
My tenure at Disney would span 22 years. In my journey, I first served as an assistant in the Publicity Department at The Walt Disney Studios, moved up to become a publicist in TV and Film Publicity, relocated to the Disneyland Resort as supervisor of Publicity and returned to the studio as manager of Corporate Marketing and finally director of Corporate Synergy in my final decade with the company. I lived deep inside the Disney marketing machine from day one to my final exit.
Part One of this book, “Marketing Outside the Company”, explores my early forays into that specialty for several years before Michael Eisner and Frank Wells took over the Disney reins. The book then moves forward with a deep dive into a new world of hyper-marketing when they came on board.
Part Two, “Marketing Inside the Company”, shines a light on the amazing revitalization of the Disney Company under the leadership of Eisner and Wells. The story will focus on how they brought a new energy to Disney marketing by incorporating a company-wide synergy strategy to make the most of every corporate asset. Synergy, of course, underscored an organizational “working together” mindset that would cross-divisional lines and eradicate silo-based thinking. It was a concept that was initiated by Walt Disney many decades ago.
From 1990 to 2000 I occupied the heart of the Disney synergy machine as director of Corporate Synergy. How the synergy team so successfully fostered that concept throughout the company, an often-asked question, will be brought to the forefront. Read carefully, it works!
Michael Eisner once explained, “We insisted that each division help the other fellow. For the Disney Company, ‘help the other fellow’ meant the movie division would create a film…that could become a theme park ride or attraction…that could become a consumer product…that could become a television show…that could become a film sequel…that could become a cable show…that could become an international attraction…that could become a musical on Broadway…it goes on and on. But to accomplish that, everybody had to cooperate with each other, with no place for jealousy, and no competition between divisions. That’s an unlikely reality in corporate America. But at Disney, we worked things differently.”
Indeed we did.
And, at that time, we did so without the power of the technology that exists today. We were not yet living in a digital world; we were just getting used to utilizing computers and mobile phones. Today, the masses believe that we need to know everything about everybody, and we need to know it right now. Social media websites are the binoculars through which we peer into people’s daily lives. Facebook, LinkedIn, Twitter, YouTube, Pinterest, Instagram, and others provide the landscape for sharing even the most intimate details of one’s life. But while the social arena thrives on connection, the business environment, where collaboration and information sharing is vital to profitability, is often not optimized. It’s like leaving money on the floor.
On social media platforms, people now let it all hang out. Perhaps it’s an ego inflator, the ultimate selfie or an emphatic shout-out to others to “notice me!” In any case, we can easily find out where our friends are at any given moment, learn what they like to eat and where they like to eat it, what their favorite TV shows are, the kind of music they listen to, how many times their baby cried last night, what they thought about a new movie, and everything else that anyone cares to discuss.
The digital devices we use to get connected—mobile phones, computers, tablets, and now even wrist watches—make it all possible at lightning speed whether through the use of email and texting, or visually through photos and video. It’s instantaneous communication all the time. Is there an advantage to being connected 24/7? From a social perspective having hundreds of friends worldwide can be informative and entertaining, although one must always be mindful of the internet’s darker side and tread carefully. However, if you need a new car, you can just poll your friends and get feedback; if you need a recommendation for a good plumber, you just need to put the word out; or if you’re seeking a new pet, just ask.
Michael Eisner and Frank Wells knew that communication and connection were the keys to elevating the Disney Company to a new level. They led a synergy charge that brought explosive growth, phenomenal success, and skyrocketing profits to Disney. Incorporating synergy into every corner of the corporation played a significant role in reaching those heights. In doing so, the Disney Company became a well-oiled marketing machine where no stone remained unturned when it came to fostering internal cross-promotion on priority projects.
In the process of writing Inside the Disney Marketing Machine, I had the opportunity to interview many former and current Disney executives with whom I worked during my time at the company. Although I have shined a light on those colleagues, certainly many, many more were instrumental in Disney’s success. We were all a team.
Today the Disney Company is the number one entertainment company in the world, employing vastly different strategies, tactics, and marketing approaches to energize the organization. The synergy processes and programs put into place during my tenure at the company, and described in this book, have long since been changed, and rightfully so, with current top management having successfully guided the organization into the 21st century.
In that regard my book is written from a historical perspective, covering marketing milestones during the tenure of the “dream team” of Michael Eisner and Frank Wells. It was a special moment in time when all the stars seemed to be perfectly aligned and everything turned to gold.
Marketing then was, in Disney jargon, an “E” ticket. (The phrase “E ticket” refers to the admission ticket system used at Disney theme parks before 1982 where the “E” ticket admitted the bearer to the newest and most advanced rides.)
Eisner and Wells charted a new course that reawakened and renewed the sleeping giant that was The Walt Disney Company in the mid-1980s and 1990s. That’s what this book is about. I hope you enjoy the ride.
Lorraine Santoli, former director of Corporate Synergy for The Walt Disney Company, has established herself as an innovative communicator, creative thinker, writer, and idea specialist.
Santoli began her career in the entertainment business at the NBC Television Network in New York City, where she honed her business and creative skills in TV and radio research as well as becoming one of NBC’s first female camera operators. After nearly ten years with NBC, in 1978 Santoli left broadcasting and relocated to the West Coast where she joined the Walt Disney Company.
Over a 22-year Disney career, Santoli worked her way up the Disney organization from marketing assistant to TV and motion picture publicist, to Supervisor of Publicity at Disneyland, to manager, and finally director of Corporate Synergy for entire the Walt Disney Company under the leadership of Michael Eisner and Frank Wells. In that pivotal role she coordinated all internal cross-promotions for over 50 diverse Disney businesses—from Film and Television to Home Entertainment, Consumer Products, Sports, Theatrical Productions, and Theme Parks.
Today, Santoli resides in New York’s Westchester county and is an accomplished freelance writer, book author, journalist, and speaker. She also served as executive director of the Annette Funicello Research Fund for Neurological Diseases from 2010–2013.
When cold weather put the kibosh on an outdoor White House event, Disney convinced President Reagan to hold it in EPCOT instead.
The Walt Disney World marketing team came up with a bold idea to“wow” the newly installed Eisner and Wells. It involved the sitting U.S. president at the time, Ronald Reagan. Having been elected for his second term, Reagan’s swearing-in ceremony held on January 21, 1985, and traditionally held outdoors, had to be moved inside because of bone-chilling temperatures that Washington, D.C. experienced that day. All of the outdoor events scheduled, including over 50 high school bands from around the country that had traveled to the nation’s capital to march in the inaugural parade, were cancelled.
Enter the marketing team in Orlando with an idea to turn a big weather disappointment into a once-in-a-lifetime promotional opportunity. Phil Lengyel, then vice president of Marketing for Walt Disney World explained, “We were looking for more ways to promote EPCOT Center that had opened just a few years earlier. The idea was to invite the president to restage the inauguration and we’d do it at EPCOT in May when the weather is great, the park attendance isn’t as great, and we’ll invite all the high school bands that didn’t get a chance to perform for Reagan in D.C. to have a second chance. Of course, for the first time, we’d get a sitting U.S. president to make a visit to a Disney theme park.”
Lengyel and his boss, Walt Disney World marketing chief Tom Elrod, whom the Orlando Sentinel once called “a marketing whiz”, and Disney Parks marketing guru Jack Lindquist, referred to as “one of the most outstanding marketing people in the world’’, decided to pursue the idea by themselves without telling anyone else or getting any approval from their bosses in Burbank. They were flying by the seat of their pants.
Pulling Disney company strings, the marketing duo found their way to Ronald Reagan’s chief of staff, Michael Deaver. Lengyel recalled, “Elrod and I flew to D.C. to meet with Deaver and pitched him the idea. Deaver responded with unexpected immediacy: “I’m going to see the President in a little while,” he said. “Why don’t you guys stick around and I’ll get you an answer real quick.” We waited. Before long, Deaver returned and said, “Okay, we’ll do it.” I’ll never forget it. Elrod and I sat there and looked at each other and said, “What are we going to do now?”
The marketing duo hadn’t asked anybody in the company if they could do this, an event that would no doubt make quite a dent in the Walt Disney World Resort marketing budget and be a logistical nightmare to stage. Dick Nunis, who was then head of Walt Disney Parks and Resorts, didn’t know, and certainly the relatively newly installed Eisner and Wells didn’t know.
But who could turn down an opportunity to host the sitting president of the United States and all the media coverage that would come with it? Certainly not the hierarchy at the Disney Company. President Reagan even had a history with Disney. He had served as one of the hosts, along with Walt Disney and TV personalities Art Linkletter and Bob Cummings, of the live television special that broadcast the opening of Disneyland in 1955. But putting together all the theme park factions needed to pull off Reagan’s appearance at EPCOT Center would be quite a task. Lengyel explained, “It was a matter of organizing the event and then getting the Disney machine behind it. We got the entire marketing group together—Publicity, Promotions, Public Relations, Advertising, Creative Services, Special Events, Corporate Alliances—to get them in lockstep moving forward. We were one group with different functioning elements. We created what the idea needed to be, but it was up to each specific area to figure out how we would accomplish it from their perspective.”
And the marketing group was only the tip of the iceberg when it came to coordinating such an extravaganza.
Ultimately, “The President’s Inaugural Band Parade,” titled to focus on the student bands that never got to perform at the D.C. event, impacted nearly every division of the Disney outpost in Orlando: “We thought about things like community implications so we got Community Relations involved, all things had to be coordinated so we had to be in sync with Operations, we needed Transportation to handle moving people from one place to another, the Food folks had to feed hundreds of people, hotel personnel had to be included, Security of course was heavily involved working with the Secret Service, after all it was the sitting president of the United States who was going to be our special guest.”
Most importantly, Lengyel insisted that everyone be in it from the beginning because the ideas from the different factions were, as he stated: “As valuable as ours. I never wanted any of them just taking an order from the marketing group. They each had an absolute interest in making our events successful, and, quite frankly, they were the pros, we were just the dreamers.”
Continued in "Inside the Disney Marketing Machine"!
Of all the successes Michael Eisner while running the Disney company, synergy may have been the most important.
The creation of a formal synergy program at Disney was initially handled by Art Levitt, a young executive that Eisner had drafted into service. Levitt also served as Eisner and Wells’ executive assistant overseeing a new Disney department called Corporate Marketing. After just a few years in that role, Levitt relocated to Florida after he was offered a senior position to oversee an entertainment, dining, and retail area called Pleasure Island at Walt Disney World. While Levitt had begun formulating a synergy process at the company, Disney was really just dipping its toe into the synergy waters at that time.
In 1989, they hired Linda Warren, a razor-sharp and seasoned Disney marketing executive who took over Levitt’s dual positions. It was her charge to up the synergy game. Eisner and Wells had become familiar with Warren when she and her boss, Walt Disney World Marketing chief Tom Elrod, met with them soon after their arrival at Disney. Warren said, “When Michael and Frank came onboard in 1984, they saw completely untapped resources within the company. One of which was Walt Disney World where I was then working under Tom Elrod who headed marketing there at that time.”
At Elrod and Warren’s first meeting with the new Disney leaders they were immediately challenged by the pair. “They said, “We want you to come up with a hundred ideas of how you’re going to accelerate marketing at Walt Disney World.”
And that tall order had a few more caveats. “They also wanted us to get a million-and-a-half additional visitors in the current year. Plus, in ten days they were traveling to Walt Disney World and wanted us to present everything they asked for.”
Tom and Linda headed the team who did indeed come up with the 100 ideas requested. Warren recalled, “At the top of the list was expanding our advertising in various markets. Plus Michael and Frank were pleasantly surprised with what the team put together in all the ideas, the result of which was that we actually upped the visitor goal by a million and a half that year. I knew from that point on, nothing would ever be the same.”
Warren admitted that it was truly marketing magician Elrod’s leadership who took them to that goal.
Before being offered the corporate by position by Eisner and Wells in 1989, earlier in that same year Warren had been promoted to director of Marketing at Walt Disney World, a job she was very excited about taking on.
But just three months into that position she got a call from Dick Nunis, then president of Walt Disney Attractions, who told her that Michael and Frank were interested in having her relocate to California to replace Art Levitt. She was very reluctant to leave her marketing “dream job”, but agreed to interview with them. She got the job. Although it meant leaving her new marketing role at Walt Disney World, she realized that working at the Disney corporate headquarters in California with the CEO and president of the company was a once-in-a-lifetime opportunity. “They were really, really focused on synergy. Art Levitt had begun the synergy surge, but as Michael said, “I now want to put a full court press on it and have you handle that responsibility.”
This all was happening as I was starting to think about leaving Disneyland. In 1990, I made a cold call to Linda Warren and spoke to her about my interest in returning to Burbank. I knew Linda in passing since she had been on the Walt Disney World marketing team for many years before accepting her senior executive role at the studio a year earlier. It was the right phone call at the right time. She was seeking a new communications person to get onboard the synergy machine that she, Michael, and Frank were building. I was hired as manager of Corporate Synergy and Special Projects, the new name for what had been Corporate Marketing. Ultimately, I was promoted to director while Linda rose to become VP of the department.
Continued in "Inside the Disney Marketing Machine"!