DISNEY - GO WOKE, GO BROKE?

The Impact of Woke Policies on Disney Stock.

The Walt Disney Company (ETR: WDP) has long been a powerhouse in the entertainment industry, with a vast portfolio that includes iconic franchises like Star Wars, Marvel, and beloved animated classics such as Snow White, The Little Mermaid, Mulan and The Lion King. However, in recent times, Disney's stock has faced a noticeable decline, leading many investors and analysts to question the influence of what is commonly referred to as woke policies on the company's performance.

All of this gained even more attention, when South Park aired the already legendary “Joining the Panderverse” episode.

This article explores the connection between woke policies and Disney's stock decline, taking into account specific underperformances such as the Star Wars Sequels, The Little Mermaid, The Marvels, She-Hulk, Echo and Indiana Jones and The Dial of Destiny.

Woke Policies and Cultural Shifts

The term "woke" is often used to describe a cultural and political movement that advocates for social awareness and justice. In the context of entertainment, woke policies refer to an effort to incorporate diverse representation, and specific values in storytelling.

Star Wars Sequels

The Star Wars Sequels, have been a focal point of controversy among fans. Some argue that the injection of woke ideologies may have influenced storytelling choices.

Title heroes such as Luke Skywalker were - as they say - deconstructed and a character sketch was developed that is diametrically opposed to the original figure.

At the same time, Luke, Leia and Han Solo didn't have a single scene together. While Luke underwent considerable development over the course of the original trilogy and had to overcome his weaknesses, Rey - the main character of the sequels - had almost no weaknesses. She was therefore mocked as a so-called Mary Sue. A flawless character who easily defies everything and everyone. Where Luke needed years of training, she defeated the antagonist in their very first encounter. What fan can identify with flawless and overpowering characters? Didn't it make the earlier heroes interesting that they had flaws and were therefore approachable?

The Little Mermaid

Disney's live-action adaptation of The Little Mermaid generated headlines for its casting choices, particularly the selection of Halle Bailey as Ariel. The film faced criticism for allegedly prioritizing political correctness over authenticity and for ignoring many facets that made the cartoon movie a success. The resulting polarization within audiences has contributed to the film's reception.

The Marvels, She-Hulk, Echo, and Ant-Man 3

Marvel Studios, a subsidiary of Disney, has been under scrutiny for its approach to woke policies in recent projects. While Marvel broke one cinema record after another from 2008 to 2019, both the current films and series are more than disappointing for the majority of fans. Pretty much the only exceptions in recent years have been Spider-Man - No Way Home and Guardians of the Galaxy Vol. 3 by director James Gunn, but more on that later.

The introduction of characters like She-Hulk and Echo, alongside developments in Ant-Man 3, has ignited discussions about the balance between social messaging and storytelling. The potential risk of alienating largest segments of the audience impact the commercial success of these films, almost certainly influencing Disney's current and future stock trajectory.

Indiana Jones and the Dial of Destiny

Dial of Destiny was a disaster for Disney, with a loss of 100 million dollars. They did to Indiana Jones, what they had already done to Luke Skywalker. They deconstructed him, took away his happily ever after happy ending and turned him into a caricature of himself. His niece was smarter, better and more competent in every way possible, without having to go trough the experiences fans saw Indy go through for decades. Again, a character nobody can identify with. People have flaws, people go through tough times, you won’t always be the smartest, strongest, most cultured person in the room.

A new hope?

With fresh blood came fresh criticism.

When Sharmeen Obaid-Chinoy was announced as the new director for an upcoming Star Wars movie many people questioned Disney’s decision. They chose to select a (primarily) documentary director to direct their new movie.

Many of Chinoy’s statements gave the impression that the focus was once again on a message, while the story and the will of the fans were neglected. Much emphasis is placed on the fact that she will be the first female director of a Star Wars film and she emphasizes that it is time for a woman shape the story in a galaxy far, far away. Forgetting that women like Bryce Dallas Howard have already delivered strong episodes in the universe of the Star Wars series. This is not only unfair to her, but also a questionable marketing approach. A director's ability to capture good stories and deal with the lore may have many causes. Gender is not one of them. Dallas Howard is a good director because she is competent and knows her craft.

Many people question this marketing approach. Instead of focusing on building anticipation among fans for a new Star Wars movie and assuring them that an exciting new story is being told, buzzwords are being thrown around that have nothing to do with the actual demands of fans. The very people who buy movie tickets, merchandise and streaming subscriptions.

Is the audience to blame?

I firmly believe that 99% of viewers and fans don’t care about whether the director or cast is male or female or if quotas are met or not as long as the story and characters are great and approachable. Fans love Sigourney Weaever as Ellen Ripley in the Alien franchise, Uma Thurman in Kill Bill, or Linda Hamilton as Sarah Connor the Terminator franchise, while they hate Arnold Schwarzenegger as Mr. Freeze in Batman. Princes Leia is beloved by millions, not simply because she is a woman, but because of her catchy character. Scarlet Johansson as Black Widow and Jeremy Renner as Hawkeye were among the most beloved Marvel characters, because their character arcs were well written and they had to keep up with actual superheroes.

They also loved Snow White, Arielle and Mulan. What do they have in common? It’s not about their private parts. It’s about overcoming adversity, fighting for a greater good and evolving as a person. Things that many modern movie protagonists lack.

It is important for entertainment companies to evolve and reflect the diversity of their audience, but there needs to be a balance between great storytelling and casting choices. Furthermore the focus should be on quality, not on quantity. From 2021 to 2023, Marvel Studios released 25 titles, including 10 feature films, 13 TV series (including two seasons each of “Loki,” “What If…?” and “I Am Groot”) and two TV specials. To put that in perspective, from 2008 to 2019, Marvel Studios released 23 feature films total.

The recent flops within the Disney portfolio show that a misalignment between all these elements has contributed to the decline in Disney's stock.

Another problem seems to be the lack of fresh ideas. Sure, Disney has created some new brands and IP, some more, some less successful. And while it is understandable, that they want to focus on supposedly “safe bets” by renewing cartoon classics by turning them into animated movies, this strategy does not create the same charm according to critics. Lifelike film characters have limits to their imagination, facial expressions and behavior that comic characters do not have. A point that film critics and fans have already reproached those responsible at Disney several times.

Will they be able to stop the trend immediately and focus more on storytelling?

No, because many films of the current zeitgeist are yet to be released. The production process from filming to post-production can take up to 3+ years. In this respect, the release of new projects with a different approach will probably take a few more years.

The Empire strikes back

In a franchise far far away, director James Gunn was able to make a movie that shone with a standout story, high stakes and drama, and told the Guardians of the Galaxy story for now. The movie was a reminder that there are still top-notch movies coming out of Disney today. Despite a superhero slump, the movie was successful and highly entertaining, and popular with the majority of critics. But the movie wasn't good because the cast was so diverse - which it is - but because the story was good, the craftsmanship was right and because they took the time to develop the characters. So not all is lost at Disney either.

But there is still one fly in the ointment. James Gunn moved to DC and thus to Warner Brothers Discovery (NASDAQ: WBD). Incidentally, this is one of my absolute favorite stocks at the moment and I might dedicate an article to it at some point.

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