Disney Elsa Costume Shortage – Marketing Mastery or Horrible Demand Planning?

How many times have you been somewhere and hear some random person belt out, “the snow never bothered me anyway!”?

I remember one awkward moment on my way to a 6am flight where a dad had quite a bit more enthusiasm singing than the daughter he was entertaining. As awkward as that moment was when he realized they weren’t alone anymore, I can’t blame him. The song is really catchy. I caught myself humming just now. The song is basically the anthem for all kids (and apparently weathermen) everywhere for the foreseeable future. With literally everyone and their mother (and father) singing this song, finding any sort of Frozen memorabilia is almost impossible.

How I became a victim of the Disney Elsa costume shortage

Three months ago my daughter started her campaign for an Elsa costume, nothing too demanding, just steady not-so-subtle reminders of how much she would like to have this costume for her birthday. As it turns out, a bunch of other little girls must have been having the same conversation because they sold out every time a shipment came in and nobody had any idea when more would arrive.

It got to the point where my wife called the store every week with no results and then started calling stores in every city where we thought someone might be willing to pick one up for us. Still nothing…until about two weeks ago. My wife was going through the phone calls to see if anything had changed and most stores gave the typical “we don’t know what’s in the shipment until it arrives” answer. Most likely lies but the one in Chicago told us they were expecting some dresses to arrive the next day.

I texted about five people to see who might be willing to drop what they were doing to go over there – and my stepmom ended up being the one to come through with the “best present ever,” Luckily she didn’t go over there after work like she initially suggested, because by the time she got over there shortly after the store opened, they were almost gone.

Why doesn’t Disney make more Elsa costumes?

Most people answer that question with some variation of “Disney just wants to keep demand high,” which seems plausible on the surface. It doesn’t hold under a bit of scrutiny because of the group driving the demand for this product – children. Kids want what they want and for the most part couldn’t care less about the scarcity of an item. They also don’t care about price, which leads to my next point.

The Elsa costume costs the same as any other costume they currently offer. Let’s be real – Disney doesn’t need to resort to elementary marketing tactics to manipulate product demand. The “power of the mouse” is probably the greatest marketing machine known to man. Deliberately limiting supply while maintaining price goes against all economic principles, especially when people are reselling them on eBay for 20x the price. Oh and don’t forget all the counterfeiters and people “inspired by Frozen” trying to capitalize on the shortage of product.

So what’s driving Disney’s Elsa costume shortage?

I suspect sub-par demand planning is to blame. While I can’t tell you for sure what goes on at the house of mouse, I can tell you a couple of facts about the situation supporting my conclusion:
1. Disney had no idea how big of a hit they had on their hands. How could they? It takes some gall to come out thinking you made a movie that is printing money like Frozen. From the toys to the costumes to the stage performance and course Disney on Ice, people usually only dream of this kind of success.
2. Disney store stock was expected to be back to normal by July/August timeframe and the shortage still has no end in sight
3. Mass production of Disney’s costumes costs pennies on the dollar which means if there is any doubt on how much you’re going to sell, it’s probably in your favor to be stuck with a few units in inventory than to miss a sale. The fact that Disney store shipments can’t last more than a few hours before being cleaned out by frenzied parents means one of two things. Either Disney continues to underestimate existing demand or their initial projects were so far off they can’t catch up even when running production non-stop.

In short, the cause of the costume shortage was horrible demand planning then or horrible demand planning now. I guess even the most magical company on earth makes a misstep every now and again.