Acquired
00:58:15 · Ben Gilbert, David Rosenthal
[00:58:15] S0: I mean, it's kind of amazing. Right? Pay to become a member of a club to dedicate yourself to fandom so you have the right to buy more things. [00:58:23] S1: The right to buy more things. Yes. So, like, hats, buttons, banners, etcetera. And all of this revenue is getting split back with Disney, the $25 club charter and then all the merchandise revenue. Pretty quickly, there are 800 Mickey Mouse clubs across the country with more than 1,000,000 total members. That is more members than the Boy and Girl Scouts of America combined at this point in time. [00:58:56] S0: That's insane scale and insane speed of adoption pre Internet. [00:59:01] S1: Right? Right. [00:59:02] S0: Pre Internet, pre cable, pre broadcast TV. The ability to get a million Americans doing something within a few years is, like, how how did that even work? I mean, I'm trying to think how word could even spread that quickly. I guess through Just through the theaters. Distributors Yeah. To the theaters.
00:59:02 · Ben Gilbert, David Rosenthal
[00:59:02] S0: Pre Internet, pre cable, pre broadcast TV. The ability to get a million Americans doing something within a few years is, like, how how did that even work? I mean, I'm trying to think how word could even spread that quickly. I guess through Just through the theaters. Distributors Yeah. To the theaters. [00:59:19] S1: Well, this is like a no brainer proposition for a movie theater operator. You're gonna take your Saturday or Sunday afternoons, which are probably reserved mostly for kids anyway, all your matinee showings. Right. You're gonna convert it into a Mickey Mouse Club. Kids are gonna love it. They're gonna buy a bunch of stuff that you otherwise wouldn't have the opportunity to sell to them. Parents are gonna love it because they get rid of the kids. And then for Disney, they're just getting this turbocharged distribution and brand recognition of Disney the company and Mickey Mouse, the character. [00:59:55] S0: Yeah. It's amazing. Okay. So they take the learnings from the Mickey Mouse Club. Right? And they kinda lean into Mickey in a in a big way at the corporate level.
00:59:55 · Ben Gilbert, David Rosenthal
[00:59:55] S0: Yeah. It's amazing. Okay. So they take the learnings from the Mickey Mouse Club. Right? And they kinda lean into Mickey in a in a big way at the corporate level. [01:00:03] S1: Totally. So just a few months after the Mickey Mouse Club kicks off, in January 1930, they launch a daily Mickey comic strip with King Features Syndicate in newspapers around the country. It gets published daily in 60 US newspapers and then also internationally in 20 more countries around the world. So Disney is getting paid to produce a Mickey comic strip, which only cost them the salary of the one animator that they have making it every day, a 24 year old named Floyd Gottfredson, who would do it every day for forty five years. Wow. Wild. So not only are they getting revenue for this, they're getting free daily advertising and IP exposure to probably a 100,000,000 plus people through this newspaper comic distribution every single day. [01:01:06] S0: And even if they weren't getting paid for it, the marketing on that so that people go see Mickey films. [01:01:11] S1: Exactly. Yeah. It never becomes a huge revenue or profit driver for them. But, like, that free daily marketing in most major newspapers around the country
01:01:11 · David Rosenthal, Ben Gilbert
[01:01:11] S1: Exactly. Yeah. It never becomes a huge revenue or profit driver for them. But, like, that free daily marketing in most major newspapers around the country [01:01:19] S0: is incredible. Yep. Interesting to know, Oswald actually was on a candy bar back in the day. But when Walt, who at the time thought he owned Oswald, had the opportunity to monetize it, he was like, I I didn't even consider it. It it it doesn't need to be an additional revenue stream. It's just really good for me if Oswald is on the candy bar. Right. So that Right. That's sort of, they're getting the seeds of, okay. We're making some money on the comics, but it it it really is like a massive marketing engine. [01:01:47] S1: Well, you're teeing up the big one here, which is merch and consumer products. Yep. So pretty quickly after Steamboat Willie, Walt is walking the street in New York, and a man comes up to him, like, comes up to Walt Disney on the street and offers Walt $300 to license the Mickey character to put it on a series of children's writing workbooks that he's producing there in New York. And this is, like, really early days. Mickey's just starting to work. The studio still needs money. So Walt's like, sure. Yeah. I'll take $300. [01:02:25] S0: Why not? And $300 in 1929, it's a lot of money. I mean, this is the beginning of the Great Depression.
01:02:25 · Ben Gilbert, David Rosenthal
[01:02:25] S0: Why not? And $300 in 1929, it's a lot of money. I mean, this is the beginning of the Great Depression. [01:02:31] S1: Yes. Yes. Mickey takes off during the depression. In fact, he sort of becomes like a national champion. It's part of his success that people view plucky Mickey's success as a mouse as the underdog as, like, that Americans can identify with through the depression. [01:02:47] S0: And life is hard. I mean, having a sort of way to disassociate a little bit and then just enjoy a, like, fun loving problem free cartoon. I don't think people know this. Mickey's role in these early comics is exactly what you're saying, the underdog. He's getting himself into these tricky situations by someone that seems bigger and stronger, and he's able to figure it out and emerge. It's the American spirit.
01:02:47 · Ben Gilbert, David Rosenthal
[01:02:47] S0: And life is hard. I mean, having a sort of way to disassociate a little bit and then just enjoy a, like, fun loving problem free cartoon. I don't think people know this. Mickey's role in these early comics is exactly what you're saying, the underdog. He's getting himself into these tricky situations by someone that seems bigger and stronger, and he's able to figure it out and emerge. It's the American spirit. [01:03:07] S1: Yep. Yep. Yep. So back to the writing tablets. They take off and do huge, huge sales. Disney doesn't even know how much sales because all they have is $300 in a handshake from this guy. So Walt and Roy figure, alright. We need to get smarter about merch. So they contact an ad man in Kansas City that Walt admired named Kay Kamen, who had owned an advertising firm, and they agree to do a deal where Kay becomes the exclusive commercial products agent for all Disney merchandise licensing beginning in 1933. And the deal they do is that Disney would get 60% of the first $100,000 in royalties that Kay is able to generate from licensing Disney brands and mascots. And then after the first 100 k, they would split every dollar of licensing revenue $50.50. And there would be a lot of dollars after the first 100 k. This is a huge moment. I mean, there there is a real case to be made that besides Walt and Roy, and and of I works too. But at least on the business side, besides Walt and Roy, Kaye came in was the third most important person in the first, you know, half century of Disney.