I don't think the Aladdin marketing campaign was particularly strong. In terms of merchandise, I don't remember anything beyond the characters appearing on 2 styles of Kleenex boxes, a box of Corn Flakes, and a few stuffed animals at the Disney Store, and I was looking hard!
I read somewhere that Aladdin was supposed to be the 2003 Platinum, but quite a while before 2003, it was switched with The Lion King due to post 9/11 concerns...2003 seemed too soon. I wonder if those same concerns kept them from promoting the movie as strongly as some of the others? I definitely remember a flood of Lion King toys, a barrage of Cinderella toys/home supplies/costumes, and The Little Mermaid has brought a new wave of Ariel dolls, special Ariel costumes, little-girl bedroom decorations with Ariel, etc. But there wasn't nearly as much in terms of 'stuff' promoting Aladdin.
I think the disappointing sales are probably the result of poor marketing. The movie was hugely successful at the box office and on VHS, and a recent article in the USAToday reported that for the months of August and September this year, Jasmine was #2 among top-selling costumes at the Disney Store (Captain Jack Sparrow as #1). When I worked in WDW, many many more young girls than I would have expected told me that Jasmine was their favorite Disney Princess, and I saw nearly as many little girls walking around the parks dressed as Jasmine as I did dressed as Cinderella and Aurora. I recently gave a speech on The Little Mermaid in my public speaking class and polled my class to name their favorite Disney movies, and Aladdin had the 2nd highest number of votes. And at this site, wasn't Aladdin #1 on the hero countdown, "A Whole New World" the #1 song, and Jafar in the villains top 3?
Something was wrong with the marketing, regardless of how much post-9/11 tensions had to do with it. I thought the DVD trailer was very poorly put together; there was no sense of what the movie was about, which isn't necessary for people who have seen the film and remember it, but I didn't think the trailer would entice or intrigue people who WEREN'T already familiar with it...maybe the 'new generation' just wasn't moved to discover it? (When the trailer says something about the "hilarious characters" that you remember and Jasmine is the character on the screen, something is off.) And with 'Disney Princess' being such a cash cow, I'm surprised there weren't new Jasmine dolls, many different versions of Jasmine costumes, or other products along those lines. Jasmine IS one of the featured characters in that highly successful brand, but they didn't seem to push to remind kids that hey, this is the movie she comes from. It seems like when the movie was new, they got that they had a hero they could market to boys, a princess to market to girls, Genie for just about everyone (though I realize that marketing Genie is a touchy subject since Disney broke their deal with Robin Williams when the movie was new)...Abu, Iago, and Rajah all became plush toys...and strength of story, music, as well as Robin Williams' hilarious performance made it a movie that teenagers and adults wanted to see, too...even multiple times! OK, so they can't use the Robin Williams edge anymore, but other elements of promotion that made it successful the first time around seeme to be absent this time.
Aladdin is my very-close-2nd favorite Animated Classic (just behind The Little Mermaid and possibly sharing that 2nd space with Beauty and the Beast and Peter Pan); I'm really sad to hear it didn't sell well, but maybe in the future it'll get another chance. That'll be one of MY wishes.