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Disney's Retail Redux

Tuesday, 9 Nov 2010 | 5:01 PM ET
Mickey Mouse
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Mickey Mouse

Today Disney CEO Bob Iger was joined by Mickey Mouse and Mayor Bloomberg to cut the ribbon on Disney's new flagship store.

The 22,000 square-foot Times Square storefront aims to take Disney's retail stores in a new high-tech direction, from the mobile checkouts to a 65 -foot high animated billboard.

Disney' isn't just trying to sell stuffed animals to the 365,000 daily passersby; it's trying to promote the Mouse House's other businesses as well — from the theme parks to the musicals like Lion King, which is playing right next door.

This is classic Iger.

Make the most of strong brands like Cars, Princesses, and now Marvel by exploiting them across all platforms, and use each division to promote the others. And this store gives a hint of how Disney will exploit Marvel, which it acquired last August, alongside more familiar Disney faces like Mickey Mouse: there's an entire area devoted to Marvel Comics.

Disney's Key Take on Economy
What Disney's new stores signal about the economy at large, with Bob Iger, Disney CEO, and CNBC's Julia Boorstin.

But does it make sense to give shoppers an entertainment experience?

Will it convince consumers to buy?

Iger says yes.

And he says he "feels good about consumer spending" on Disney products and is "bullish on the holiday season." He acknowledged that the economic environment is still rough, but Iger says the popularity of characters like those in record-breaking "Toy Story 3" translates into retail sales.

Disney stores have struggled in the past both under Disney and ownership by Children's Place - so what makes this time different? Iger says it's all about the interactivity, and a focus on the most popular characters. And based on the results at the 18 stores they've opened so far, the investment in re-vamping the stores are worth it. How much does it cost? About $750,000 to $1 million per remodeled store. Disney has about 340 stores and will decide how many to remodel depending on the success of the new look. Here are some of the nuts and bolts of the new store strategy.

Disney reports its quarterly earnings Thursday after the bell. I'll be reporting on the numbers. Come back tomorrow for a preview of results.

Questions? Comments? MediaMoney@cnbc.com

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  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.