In 2009 Disney (N:DIS) agreed to purchase the Marvel brand for $4 billion. This acquisition has proven to be extremely lucrative for Disney. Marvel films have consistently drawn huge crowds to the box office, demonstrating the interest and loyalty of the consumer to the superhero genre. Disney is set to release a number of big titles in the near future, most notably being Captain America: Civil War, X-Men: Apocalypse, Dr. Strange, and Guardians of the Galaxy Vol. 2. This huge interest in the Marvel comics will certainly force Disney's hand into finding even more ways to profit off of the brand. Disney has an untapped goldmine in turning the Marvel comics into successful video games.
Disney recently had huge success in the video game arena with Star Wars: Battlefront, selling about 13 million copies. Consumer products and interactive media is currently Disney's smallest division, reporting operating income of $860 million. Disney will likely make a concerted effort to expand its reach in this division through the development of video game series. The most profitable and established option available for Disney is the Marvel universe, which will benefit from increased exposure in the box office. This formula proved wildly successful for the new Star Wars film and video game, which helped promote one another. It's hard to imagine Disney not repeating this process through its Marvel assets.
Warner Bros. was able to turn its successful Batman franchise into a profitable video game. Most recently, Batman: Arkham Knight sold over 5 million copies, proving that there is substantial money to be made through developing superheroes into video games. Disney should follow suit and capture the large amounts of revenue that Marvel has proven to generate. With so many different characters and storylines, Disney has a plethora of content to develop into video games. The greatest challenge will be developing the Marvel franchise into successful games that gamers enjoy playing and are willing to consistently purchase. It will be up to Disney to partner with the right developers in order to create a quality game that is well received by the gaming community. If Disney is able to find initial success it will be very easily for them to build off of that and continue to expand Marvel into a profitable video game franchise.
This idea makes perfect sense for Disney and is mutually beneficial for both the consumer products and interactive media and studio entertainment divisions. Disney will be able to simultaneously promote its Marvel films and video games through each other. Marvel is already an incredibly strong brand, and development of its successful superheroes into video games will strengthen it even further.
Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in DIS over the next 72 hours.