How Mickey got Disney through the Great Depression

Before there were Mickey Mouse playing cards, hairbrushes, caps, underwear, footballs and plush toys, there was one Walt Disney struggling to make ends meet.

Walt Disney was born in Chicago in 1901 to Flora and Elias Disney. Flora hailed from Ohio, and father Elias was a Canadian from Bluevale, Ontario.

As a young man, Walt became a cartoonist for his school's newspaper, then later got a job creating commercials at an advertising company in Kansas City.

While there, Walt became enamoured with the emerging world of animation. Eventually, Walt and his brother Roy pooled their money, moved to Hollywood, and opened the Disney Brothers Studio in 1923. Six years later, Walt and illustrator Ub Iwerks created an animated short based on a new character they had developed called Mickey Mouse.

Actually, he was originally called Mortimer Mouse, but Disney's wife didn't think the name was appealing, and suggested Mickey instead.

When Disney produced the first Mickey Mouse cartoon with sound, titled Steamboat Willie, it was an instant success.

One day in a hotel lobby, Disney was approached by a man who offered him $300 for the rights to put Mickey Mouse's image on children's notebooks. The Disneys were always short of money, so Walt took the offer.

It was the start of Mickey Mouse merchandising.

Sensing the potential, Walt later signed a bigger contract with a merchandising firm, but the royalties were small and the quality of the merchandise shoddy. Walt wanted out.

That's when Herman Kamen entered Disney's life in one of the best pitch stories ever.

"Kay" Kamen, as he was known, owned a Kansas City advertising firm that created displays and campaigns for department stores. When one of those displays, for a store in Los Angeles, caught Walt Disney's eye in 1932, he wired Kamen to ask if he was interested in promoting Mickey Mouse.

Kamen wired back to say he was very interested. Then he went to the bank, cashed in his life savings, sewed all the money into the lining of his jacket, and boarded a train for California the same day.

Kamen was so worried somebody would steal his jacket that he stayed awake for the entire two-day trip.

When he finally arrived at Walt's office, Kamen presented his plans for merchandising Mickey Mouse, then took all the money out of his jacket and spread it dramatically across the desk, saying, "If you hire me, all this money is yours. I don't know how much business you're doing right now, but I guarantee you that much plus 50 per cent of everything I do over that amount."

Walt pulled his brother Roy over to the window to quietly discuss the offer. When they turned back to shake hands with Kamen, they discovered he had fallen asleep in his chair - exhausted from his wide-eyed 48-hour trip from Kansas City.

Kay Kamen would completely transform Disney's merchandising, turning it into a streamlined, quality-controlled, revenue-producing division that would eventually make Mickey Mouse the brand more popular than Mickey Mouse the movie star.

Within a year, there were 40 licenses for Mickey Mouse products. Within two years, Kamen orchestrated $35 million worth of sales in Disney merchandise.

You have to put Kamen's achievement in its proper perspective.

These were the Depression years. In spite of being the darkest business days in history, he even persuaded General Foods to pay a million dollars for the right to put Mickey on cereal boxes.

From that point on, the image of Mickey Mouse was everywhere. There was Mickey Mouse soap, candy, playing cards, hairbrushes, caps, socks, shoes, underwear, footballs, baseballs, plush toys, and of course, watches.

By 1934, Walt was claiming that he made more money from Mickey's merchandising than from Mickey's cartoons.

That was important for three reasons: The Walt Disney company now had money in the bank to finance its films. Every Mickey Mouse product was a walking advertisement for the company, and when people took a piece of Mickey Mouse home, they stored him in their hearts.

By 1949, Kay Kamen was selling $100 million in Disney goods every year. One night, he celebrated that milestone over a dinner with Walt and Roy in Paris. The very next day, while flying home, Kamen and his wife died in a plane crash.

The Disney brothers were shattered.

But Kay Kamen had built the foundation of an empire. And Disney became the first studio to recognize what would become a standard business practice in Hollywood 40 years later: That merchandise was powerful marketing.

For more stories about Movie Merchandising, click or tap the "Listen" button above to hear the full Under the Influence episode. You can also find us on the CBC Radio app or subscribe to our podcast.

Under the Influence is recorded in the Terstream Mobile Recording studio, a 1969 Airstream trailer that's been restored and transformed into a studio on wheels, so host Terry O'Reilly can record the show wherever he goes.

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