GoKawiilDisney and Kraft Heinz are partnering, with Kraft Heinz paying Disney for unique access and marketing. According to The Hollywood Reporter:
In a wide-ranging brand deal unlike anything in recent memory, The Walt Disney Co. and Kraft Heinz have inked a multiyear “strategic alliance” that will span media and experiences, bringing Kraft Heinz brands to Disney’s film and TV content, as well as to the company’s vast theme parks and cruise business.
This is a bundle deal, where Kraft Heinz—which has allocated up to $600M1 in marketing initiatives to bolster its brands—is hoping to get more value out of a combined Disney offering featuring media, theme parks, cruises, and product packaging. According to the WSJ:
The deal enables Kraft Heinz to use Disney characters and stories across 10 of the food company’s brands, including Heinz, Philadelphia and Kraft Mac & Cheese. It also extends to Disney’s studios and streaming platforms, where Kraft Heinz will fund content co-created by the two entities.
The business selling the bundle is in a better position than the buyer. The natural bundle of TV spots, streaming, sports, theme parks, cruises, movies, and unique IP is one that Disney has ready-made. If this deal is fruitful for both sides, Disney goes and sells it in other categories to other CPG brands. Kraft Heinz can benefit from this partnership being successful, but there isn’t much more that it will be able to get out of a similar deal with NBCUniversal.2
If you are Disney, your ketchup supplier just offered you money to help you make content. Lest this alliance be mistaken for a bulk purchasing agreement:
Think condiment stations at Disneyland with ketchup dispensers shaped like Star Wars lightsabers, Amaya said in an interview. Other possibilities: Cinderella Mac & Cheese, or Jet-Puffed marshmallows marketed with images of Olaf, Frozen’s snowman.3
The full Disney bundle is unique, but elements of this have been building over the past decade. Fertitta Entertainment was early to this trend—it owns the Golden Nugget casino, Houston Rockets, Morton’s The Steakhouse, Rainforest Café, Del Frisco's, and Bubba Gump Shrimp Company. It agreed to acquire Caesars Entertainment to continue its strategy of integrating food into the casino and entertainment experience. The food can create other touchpoints for the entertainment brand when customers go to the standalone restaurants and remember the experience in the casino or at a game.
Food and experiences are being tied together more than ever and it’s part of the motivation for Kraft Heinz in doing this deal. Parents have a good time on a Disney cruise and remember the brand of mustard that got all over their son’s shirt during the cruise. Memories translate to higher sales for the mustard brand when parents are back standing in the grocery aisle wondering what to grab.4
Heinz had a partnership with the Pittsburgh Steelers for Heinz Field. That deal had value for in-stadium condiment usage but also was meaningful in TV promotion for at-home viewers remembering to put Heinz Ketchup on their burgers during NFL games. Kraft Heinz struck a partnership with the NFL earlier this year to boost condiment sales at stadiums and allow Heinz to use NFL imagery and material in advertising and marketing.5 This is a continuation of the NFL deal story for Kraft Heinz. These deals could probably be extended to tie together the partnerships Kraft Heinz already has—the NFL deal and the Disney (ABC/ESPN) alliance—to create unique team and broadcast promotions. Are we ready for large mascot versions of Heinz ketchup and mustard racing across the football field while Eli and Peyton Manning provide color commentary on ESPN?6
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