Disney Is Investing a Remarkable Amount of Money in IoT Sensors
The apparent success of Disney’s MagicBand and MyMagic+ should serve as a reminder to us all about the vast potential of business sensor technology and the internet of things. When Walt Disney set out to create Disney World in the early 1970s, his goal was to manufacture a completely immersive experience that combined the rich nostalgia of his fantastical imagination with the technological potential of tomorrow.Disney’s business model embodies this forward-thinking ethos, and the company is often first to the plate when it comes to embracing or even developing new technologies to enhance the consumer experience and its own revenue stream.Disney recently made headlines with the details of its eye-watering, $1 billion investment in business sensor technology finally coming to light, according to Wired.Although the decision to integrate its MagicBand and MyMagic+ systems throughout all of its parks and resorts seemed to come as something of a shock to the public, this decision wasn’t made overnight. Disney executives recognized the potential of business sensor technology early on, and the project has been in development since 2008.
Behind the Magic: What’s Really Going On
The principal aim of MagicBand and MyMagic+ was to effectively remove any possible chance of inconvenience during the entire Walt Disney World experience by creating a totally integrated, seamless environment for maximum fun — and profits.Each MagicBand contains a radio-frequency identification chip (RFID) and a transmitter that connect guests to a dizzying array of sensors located throughout the park. It is essentially the skeleton key to every service and amenity the resort has to offer.Among other things, the wrist band acts as your wallet and ticket for line-free rides and attractions.It also broadcasts your location, allowing for your bags to be delivered to your room from the airport or your food to arrive at your table without ever having to call the bellhop or order from a waiter.The work that went into overhauling the park to build and operationalize the system obviously didn’t come cheap, but it already seems to be paying off. In just the first three months following the Magic Band’s introduction, Disney Parks and Resorts’ total revenue jumped 6%, while operating income rose 16%, according to QZ.This may sound obvious, but there’s a direct link between consumer spending and how easy you make it to buy things.The Magic Band cuts down on lines and links directly to credit cards, removing all of the unnecessary steps and excess friction from the purchasing process, and thus ensuring maximum gains through every possible revenue channel.
The Bigger Picture
Business sensors don’t just make things easier for consumers — they generate a constant stream of high-impact data analytics.Disney’s new system combines insights like consumer spending habits and behavioral trends with location tracking to actually anticipate an individual guest’s actions and desires, thus enhancing the experience and generating maximum per capita spending.But it’s important to understand that Disney isn’t really ahead of the curve when it comes to recognizing the value of investing in sensor technology — most other companies are just woefully behind.This model can be applied across a broad spectrum of industries; from smart factories that monitor safety and productivity to Internet-connected cars that allow for better navigational services and performance optimization, the Internet of Things is fully entrenched across an array of industries.That means they must be thought of as an integral part of any business model that wants to remain viable in the years to come.