Elsa lets it go. (AP Photo/Disney)

Last month, Binyamin Appelbaum took his daughter to a show at George Mason University’s Patriot Center. The show was “Disney on Ice Presents Frozen.” The arena vendors sold $15 snow cones and $28 plastic wands. Appelbaum went home and did what you would have done, if you were a New York Times economics reporter: He called the movie’s creators, asked how they’d created a profit machine and wrote a magazine column off the answers.

Appelbaum’s column paints “Frozen” as a great American success story. But I wondered if there was more to the story, possibly something more sinister. He kindly agreed to explore that with me, in what we’re sure is the first Post-Times online dialogue about the economics of a Disney movie.

Jim Tankersley:

Binya, how many times have you seen “Frozen”? I’ve seen it twice with my son, which is approximately 25 fewer times than I saw “Cars,” but still enough to understand how the movie has become a $1 billion cash cow for Disney. I know this figure because I read your fantastic column on the business of “Frozen,” and how it defies economic trends to make so darn much money. I’ve been thinking about it all week, especially this part:

“Brands are said to be in decline. Studies show that customers are less loyal to companies, quicker to try something new. Products increasingly rise and fall on their own merits… But Disney, perhaps more than any other large company, appears to be impervious to the trend. It helps that the company is not selling products based on the quality of craftsmanship, but based on the quality of its stories.”

So what, my friend, can American business learn from Disney? What does “Frozen” tell us about our economy?

Binyamin Appelbaum:

I have a confession to make: I haven’t seen “Frozen.” But I did take my 4-year-old daughter to see “Frozen” on ice, and that’s where this story began. There was a family that filled the rest of our row — a mom and dad and six kids. They bought treats, they bought souvenirs, they were clearly having a ball, and I just kept thinking, Wow, they are spending a lot of money. And there are 10,000 people in this arena. And they are doing two more shows today. And I just started wondering how big this thing actually was, economically speaking.

So what are the big lessons? Well, Disney’s formula is a mix of some timeless strategies and some that are pretty new. The timeless part is telling great stories, and specifically creating characters that in some sense embody the aspirations of its audience, and then selling products that let kids identify with those characters. I’m not saying any of that is easy — Disney itself fails more often than it succeeds — but it’s not really new.

The newer part, experts tell me, is the focus on toys for girls vs. toys for boys. Toy companies have concluded that they can appeal more powerfully to young customers if they appeal to them as boys or girls, rather than as kids. This is a really big trend, it’s clearly a commercial success story, but there are some obvious concerns too.

And then finally there is this interesting divergence between marketing to kids and marketing to adults, which is that adults increasingly can turn to the Internet to learn about products in ways that are beyond the control of the retailer. And Disney, in the stuff it sells to young kids, is really sheltered from that trend.

Tankersley:

Wow, I did not see that coming! “Frozen” on Ice, but not “Frozen.” Maybe you should go watch it now before we proceed. At least watch this about 15 times:

I have mixed feelings about the Disney focus on girls. It’s long overdue, for sure, and Elsa and Anna are certainly strong characters. But marketing harder and harder to kids also seems like a fairly Duke-of-Weselton (did you watch??) way to separate middle-class families from their money. Kids are an impressionable audience. Adults are already spending a lot more money on children than they used to. If your New Business Model in an age of better-informed purchase is to market to the consumers least able to inform themselves, that doesn’t seem like American ingenuity. That seems like Weasel-town.

What they’re selling here, as you note, is classic America. It’s aspiration. It’s the idea that everyone can grow up to be a princess, or even a queen in an ice palace of her own creation. The problem is, in America, that’s just not true. It really matters who your parents are. In this sense, “Frozen” is partially realistic – Elsa is born into royalty – and partially not. How many ice cutters do you know who grow up to date princesses? Not a lot, these days.

So is “Frozen” selling false hope to young girls? Or is it harmless fun?

Appelbaum:

Thanks, but “Let it Go” is on loop in my brainpan already. Like I said, I have a 4 year old.

Parents will judge whether Anna and Elsa are good role models. Some people find them wholesome, or at least harmless. Some people see a dangerous stereotype.

What’s interesting to me is that Disney, as a matter of commercial necessity, has made a big effort to change the character of its princesses to appeal to the current generation of children and their parents. I had the chance to talk to the people who made the movie, and I was struck by the way they described the shift. Elsa and Anna “are princesses because they’ve got the weight of a kingdom on their shoulders, not as the solution to a happy ending.”

It’s worth noting, however, that the nuances and complexities of movie characters are not easily transferred to toys. Figurines of Merida, the Disney princess in 2012’s “Brave,” generally are sold in a shiny blue dress the strong-minded movie princess hated to wear.

Tankersley:

The classic vision sells better than the nuanced, updated one? Sounds a lot like American politics. Why run on a complex set of solutions for today’s problems when you could just promise a return to the glory days of the mid-’80s or late ’90s?

This is also an alternate reading of “Frozen”: It’s so popular not because it’s a new kind of Disney movie, but a very traditional kind. A blond princess and talking magical creatures still sell. Though the zany talking snowman is a legit innovation.

Appelbaum:

There is certainly a retro quality to the “Frozen” phenomenon. Princesses, after all, are essentially medieval creatures. And people tend to seek comfort in the familiar during periods of economic uncertainty. Princess movies, like Robin Hood remakes, tend to arrive and thrive when other things aren’t going so well. Another interesting historical echo: Elsa’s blue dress. Before World War II, retailers sold blue clothes for girls and pink clothes for boys. Check out this fascinating excerpt from Smithsonian magazine:

“In 1927, Time magazine printed a chart showing sex-appropriate colors for girls and boys according to leading U.S. stores. In Boston, Filene’s told parents to dress boys in pink. So did Best & Co. in New York City, Halle’s in Cleveland and Marshall Field in Chicago.”

Tankersley:

The Disney Robin Hood is the best Robin Hood. We need more cartoons where foxes dress up as storks.

To this point we’ve been dancing around the Dumbo-sized issue in American politics today, which is the gnawing sense among a lot of people that they personally are working harder just to get by, while a select few are getting fatter and fatter. It’s hard to say whether the “Frozen” phenomenon eases those worries or makes them worse. As you say in the piece, Disney is charging premium prices for “Frozen” toys and dresses, but not exorbitant ones. (Although, $15 for a snow cone? Dude.)

Quick story: Some friends of mine took their daughter to Disneyland this fall. She really, really wanted to meet Elsa, who sits in a little house in the park. To do that, you have to stand in line for a ticket to come back later in the day. My friends waited at the gates before the park opened and ran to the ticket line, only to discover the entire day’s worth were gone already. They’d been snatched up by people who paid Disney even more money to get into the park early.

Now, my guess is Disneyland could hire a few more Elsas to eliminate that problem and give every girl or boy a chance to see her. But why do that? The false scarcity of Elsa is an incentive to spend more for early admission to the park. That’s good business, but it’s also an economic divider. Little kids with more money get to meet the princess.

Is that the sort of lesson you want your daughter learning from a cartoon?

Appelbaum:

I’d begin by taking a step back. The rise of Disney is part of a broader democratization of high-quality entertainment. Thanks to the plummeting cost of reproduction and distribution, everyone gets to enjoy the work of our finest creators and performers for a nominal fee.

Inevitably, there is still a business opportunity to market more exclusive experiences, like the chance to visit Elsa at Disneyland, or the chance to enter the park early. I suspect there are levels of exclusivity beyond those, too. Disney is masterful at market segmentation.

Maybe Disney could make just as much money — or maybe more — by mass marketing any given experience, for example by hiring enough Elsas to eliminate the lines.

But it would be leaving money on the table if it didn’t offer a different exclusive experience.

(And it’s interesting to consider whether the value of those supplemental experiences might be in decline. When exclusivity is the primary driver of pricing, it’s easy to end up paying a lot of money for something that is only marginally better than the commodity good. It’s perfectly plausible, in other words, that it’s the rich people who are getting a bad deal.)

Look, inequality is a huge issue, and some goods and services surely ought to be available irrespective of a family’s resources. Education, health care, a decent burial. Whatever you’d like. Bring your list to the next election. But hopefully meeting Elsa isn’t on it.