Unpopular Opinion: Bob Chapek Is the CEO Disney Needs
Sometimes, the weirdest hot takes are the ones where you don’t understand how they’re controversial.
The Dallas Cowboys are a wildly underachieving football in the 2000s. LeBron James is one of the greatest basketball players ever. Lord of the Rings movies are too long.
None of these statements seems outrageous, yet the internet remains ablaze with flame wars involving each subject.
Along those lines, a writer for The Motley Fool has asked a provocative question. Is Bob Chapek CEO of the Year?
Source: CNBC.com
I feel similarly and will go one step further. My apparently unpopular opinion is that Bob Chapek has been a terrific CEO so far.
The Current State of Disney
In that article, author Rick Munarriz acknowledges that Disney stock has gone down this year.
On January 1st, DIS sold for $181.18. At the close of business on October 15th, the stock sat at $176.46.
You don’t often hear of a CEO of the year candidate whose company’s value has remained stagnant.
Why has this happened at Disney in 2021? Well, you know.
Image: Disney
Disneyland remained closed for roughly one-third of the year. Since then, crowds have returned, but capacity limits have hard-capped revenue.
Disney Cruise Line, which had netted more than $400 million before the pandemic, lost $255 million for the fiscal year.
Image Credit: Disney Cruise Line(Matt Stroshane, photographer)
The movie industry, Disney’s bread and butter, hibernated for 15 months before Black Widow and Shang-Chi and the Legend of the Ten Rings awoke it.
Even Walt Disney World has struggled with lower attendance in 2020 and early 2021 as well.
For perspective, the four parks claimed combined attendance of 18.8 million in 2020. During 2019, Magic Kingdom alone hosted 21 million guests.
No business could prep for that sort of sudden attendance drop.
The Harsh Realities of the Pandemic
Disney’s core businesses are movies, theme parks and cruises, merchandising, and what we used to call cable/network television.
The pandemic sometimes looked like a personal attack on The Walt Disney Company. As such, business declined mightily.
Now, you may wonder why this matters as much in 2021. After all, we’ve all mostly returned to normal, right?
Yes, the Delta wave caused another outbreak, but Disney’s overall position should be better now than it had been in 2020.
(Christian Thompson/Disneyland Resort)
That’s a statement of fact, but it ignores that recovery has occurred at a snail’s pace.
I would argue that July and October represent the only two “normal” months of the year, times when the parks had anything close to regular attendance.
Also, the cruise industry just started back after 18 months in mothballs. As such, some of Disney’s most reliable revenue streams ended overnight.
Now, let’s go back in time to February of 2020. The day before Disney announced that Bob Chapek would replace Bob Iger as CEO, the stock price for DIS was $132.90.
Photo Credit: AP Photo/Richard Drew, File
Hey, which is a bigger number, $132.90 or $176.46?
Yes, despite unprecedented obstacles, Chapek has somehow increased his company’s stock price by 33 percent.
Yes, the number was slightly bigger at the start of the year, but Disney has sustained its value in the face of frequent setbacks.
Nobody expected Disneyland to remain closed until the end of April. The cruise industry staying mothballed into the late fall certainly seemed unlikely on January 1st.
Photo: Jeff Gritchen, Orange County Register/SCNG
Chapek has somehow hypnotized Wall Street into believing in his company even as it completes its worst 18-month challenge ever.
Blasphemous though the thought may be, even the death of Walt Disney wasn’t as devastating to Disney as Coronavirus.
Photo: Jeff Gritchen
The company persevered thanks to Bob Chapek.
Evaluating the Criticisms of Bob Chapek
Many of the complaints regarding Chapek stem from trends that were already in place.
Photo: CNBC
Do you hate the thought of excessive intellectual property (IP) usage at Disney theme parks?
Well, you’ll need to speak with the ghost of Walt Disney about that.
Attractions like Mad Tea Party, Mr. Toad’s Wild Ride, Peter Pan’s Flight, and Snow White’s Scary Adventures had one thing in common when they debuted in 1955.
Each of them had ties to a Disney movie of the era. In fact, Sleeping Beauty Castle got its name because Uncle Walt wanted to create free advertising.
The Sleeping Beauty movie wouldn’t open until 1959. So, those first four years at the castle created hype for the project.
Photo: WaltDisney.org
Yes, park IP has been going on for more than 65 years!
Now, you may feel that Chapek has gone too far with his IP usage. Well, he got the gig in February of 2020.
Maybe you heard that Disney shut down most of its construction during the pandemic.
Very little of what you’re seeing in the parks represents Chapek’s final calls. Bob Iger was CEO at the time.
Photo Credit: ABCNews.go.com
Obviously, you may argue that Chapek was in charge of Disney’s theme parks at the time, which is true.
However, each park had an individual leader, and Chapek still answered to Iger. As such, these decisions you dislike aren’t squarely on his shoulders.
Even then, how can you argue with any of them? The Avatar, Star Wars, and Toy Story themed lands have all proven wildly popular.
Customers have voted with their wallets, and they undeniably favor attractions that connect to Disney IP.
Why I Like Bob Chapek
I’m an Atlanta Falcons fan, which means Matt Ryan has been my quarterback for a while.
We’re talking about a former MVP player who will finish in the top 10 in most (good) quarterback statistics for his career.
Photo: Atlanta Falcons
Ryan has demonstrated quiet excellence. And some Falcons fans haaaate him.
If you ever pay attention to sports talk radio or social media, you’ll know how outspoken this segment is.
For whatever reason, people amplify criticisms more often than compliments. Maybe that’s the nature of humanity?
Photo: Associated Press
Still, when I see Matt Ryan, I remember a time when Joey Harrington was our quarterback. So, I’m grateful for Ryan.
I believe this same premise applies at Disney. There’s something about people where we take high-level performance for granted.
At one point last year, I called Bob Chapek the unluckiest CEO of all time. The facts supported it, as he had such a brutal start to his tenure.
Now, nobody worries about Disney’s future.
Photo: Chesnot/Getty Images
Remember that Bob Iger hinted that he had retaken control of Disney in May of 2020.
If that happened, which is debatable, it didn’t last long. Bob Chapek quickly proved that his business-first approach to Disney works.
Photo: sciencenews.org
When the pandemic started, I described him as a wartime consigliere, someone perfectly suited for a crisis situation. That’s what has unfolded.
I believe that Chapek saved Disney with his rational decision-making. It’s not sexy, but he has been the leader that Disney needed at the perfect time.
Image Credit: Disney
For that, I am grateful. Chapek has earned my respect as CEO of Disney. Frankly, I find it odd that saying I like him has turned into some sort of controversial opinion.
The man has dedicated his life to Disney, and he just steered the company through its worst circumstances ever. Why wouldn’t anyone like him?
Photo: Getty Images
Feature Image: Matt Stroshane/Courtesy Disney Parks
He need to go immediately before he causes more damage to Disney!