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IoT, wearables enter Disney Kingdom

04 May 2016  | Brent Lorenz

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A cooler example is that is on some rides it scans your band as you speed past, while it takes your picture or even a video of you on the ride. It's a tremendous revenue up-sell for the park, but I was happy to be up-sold because I didn't have any pressure to buy it on the spot. It was pretty cool to be able to download a personalised video of me and my son riding one of the rollercoasters, without having to do a single thing. Ultimately I bought the Photo Pass, which gave me access to all of the photos and videos and I was happy to fork over the money for it.

Disney wearable

Figure 2: Disney's Magic Band IoT system (Source: Disney)

There are lots of other indirect ways that Disney's Magic Band IoT system makes money and profit. First of all, it simply removes much of the friction in the customer experience, because everything is linked in real-time to your account. Say you complained about a bad experience, and you are likely to be compensated with Fast Passes (the express line for busy rides) that are electronically linked to your account via your Band. It's much better than getting a "sorry" or some coupon. Fast Passes are like gold at Disney, and having a Magic Band makes it so much easier to use them. Happy customers are going to spend more time in the park, which means they are going to spend more on food and souvenirs. They are more likely to come back again and tell their friends. It is a virtuous circle.

But perhaps the biggest return on investment (ROI) is yet to come, and that is from analysing the data from customer behaviour. By signing up for the Magic Band, Disney knows who its customer is, how old they are, how to contact them, and what they like. Disney presumably knows what they bought in the park, what rides they rode, where they walked, how long they spent in the park, in short everything. Disney can use that information to market products and services to those families after they've gone home, in a heavily focused fashion.

They can also dramatically improve operational efficiency of the park, by being able to more accurately schedule shifts of those 80,000 workers, how many Fast Passes to hand out for each ride at different times of the year, and learn what promotions work and which don't work. It can lower its safety liability by quickly reuniting lost children with their parents, or by ensuring that people aren't wandering off where they are not supposed to be.

Everybody knows that the worst part of any amusement park, including Disney, is waiting in a long line. By collecting real-time data about crowds, lines, and patterns, Disney can adjust on a daily or seasonal basis to improve the customer experience. And again, when that happens, people are in the park longer and spend more money. Every minute a guest spends in the park is an opportunity to sell them something, plain and simple.

As in many things with IoT, the advances in technology, cost and power reductions of Bluetooth, Wi-Fi, RFID, low-power microprocessors, and batteries have all enabled IoT to begin to flourish. But the value in IoT is not in the "Thing" itself, it is in the ability to use them to generate data that can be useful. Like Google, the value wasn't in the search itself, but in the ability to sell people stuff that they were looking for. IoT represents the opportunity to both sell people more stuff but also allow businesses to wring out inefficiencies and save cost. Disney seems to be perfecting this model and it's a win-win for both the guest and the park. I've got about 1,000 photos and a houseful of Disney Star Wars t-shirts and light sabers to prove it.

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