How Disney Creates Digital Magic with Big Data

For over 90 years, Disney has prided itself on producing magical guest experiences that few can match. But in the mid-2000s, as ticket prices climbed and lines lengthened, the sparkle on Disney’s customer experience began to fade.

In response, Disney created an exploratory team called the Next Generation Experience project. Focusing on creating “more immersive, more seamless, and more personal experiences for each and every guest,” the team has four goals: Driving operational efficiency; transforming the customer experience; personalization through connected products, and enhancing interactivity across channels.

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Making Magic with Technology: Disney's Four Primary Objectives

So how is Disney using big data and other technologies to create digital magic?  

A data-driven approach to operational efficiency

The magnitude of Disney’s theme park operation is staggering. Each week, Disney has to schedule 240,000 shifts for 80,000 employees and pay more than 80,000 cast members. Following the implementation of a rule-based, on-demand technology, Disney’s accuracy in managing labour resources improved by 20%. The project paid for itself in just one year from labour savings alone. Disney-big-data-Bob-Iger-MyMagic+

Disney also employs analytics to streamline back-house operations. For example, the company uses forecasting models to manage its garment inventory and laundry. The forecast models ensure enough garments are available for the cast members whilst minimising inventory and unused costumes on the shelf.  

Personalising customer experiences

Imagine a trip to Disney where you didn’t have to wait in line, carry cash, or pass through a turnstile? Disney’s MyMagic+ is a high-tech, billion-dollar initiative that eliminates these inconveniences with personalisation and connected technologies.

MyMagic+ allows guests to book ride times, restaurant reservations and shows in advance using the website. When they arrive at the park, alerts from the smartphone app remind them it’s time to enjoy their selected activities. The mobile app allows guests to change reservations in real time as needed.

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MyMagic+ MagicBands | Image Source: Disney Press Kit

MagicBands acts as an admission ticket, the key to the hotel room, and a FastPass+. Guests customise their MagicBand with their name and preferred colour. They can also connect the MagicBand to a credit card and use it for payment and restaurants and stores throughout the parks and resorts.  

Unlocking consumer trends and insights

The MagicBands are part of a new “vacation management system” which monitors consumer behaviour, analyses purchasing habits, and provides Disney employees with real-time data.

The wristbands track customer behaviour using radio-frequency identification technology (RFID), a wireless tracking system that transfers data from minuscule tags attached to objects. To store, process, analyse and visualise the enormous volume of data generated through the MyMagic+ system, Disney built a big data platform based on Hadoop, Cassandra, and MongoDB.

The results have been very promising. The new system helped Disney accommodate 3,000 extra daily visitors during the 2013 Christmas holiday season by managing advanced reservations for high demand rides. That same year, theme parks made up a third of Disney’s $45bn total revenue and 20% of its operating profit.

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A young boy redeems his FastPass+ selection with his MagicBand | Image Source: Disney Press Kit

Unlocking consumer trends with big data is of huge value to Disney. For example, they employ data mining to analyse past behaviour and preferences of individual guests and forecasting models to determine the type of vacation packages they are likely to prefer. With these insights, the company is able to send highly targeted hotel offers to its customers through its call centre, a project that paid for itself “10 times over” in its first year of operation alone.  

Digitalising the Disney Store

Disney’s commitment to deliver superior customer experience extends beyond its theme parks; it constantly strives to find new ways for its customers to interact with different parts of the Disney family.

As part of that approach, Disney gave its traditional bricks-and-mortar retail stores a high-tech makeover. The store now includes an interactive touchscreen kiosk for guests to navigate all Disney Store and DisneyStore.com products in 3D, personalise certain items, and see the latest Disney store news via video clips, articles, and social media feeds. You can also browse the products on the mobile app.

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Interactive touchscreen kiosks allow guests to browse all store products | image source: Las Vegas Informer

Upgrading the stores has helped boost profit margins by 20%, with over 90% of guests in North America and Europe saying that the new store design has brought them closer to the brand. In the four years since the overhaul, the stores in the UK alone have made $761.6 million in revenue.  

Driving Consumer Insights at all levels

A data-led approach to delivering superior customer experiences is spreading across all areas of the business. For example, Richard Ellwood, EMEA head of audience strategy at The Walt Disney Company, surveys the brand’s many different data sources to understand consumer behaviour and uses relevant data points to establish a marketing strategy and corroborate strategic moves.

So how does Disney create digital magic with big data?

It starts with strong digital leadership that understands the transformative power of big data. Disney’s board members include Sheryl Sandberg, COO Facebook, and John Chen, CEO Blackberry, and Jack Dorsey, Founder of Twitter, is the Executive Chairman.

With such formidable digital leadership, Disney was able to develop a clear digital vision which is supported by an analytics culture and an ongoing investment in digital. In demonstrating the enormous potential of big data to disrupt the entertainment industry, Disney has shown us how digital technology can become indistinguishable from magic.  

Executive Masterclass | Leading Big Data - led by David Simchi-Levi  

Sources & Citations

  1. WIRED, “Disney’s $1 Billion Bet on a Magical Wristband,” March 2015 - https://www.wired.com/2015/03/disney-magicband/
  2. Forbes, “Magical Makeover Drives Disney Store Revenue to $760 Million in the UK”, September 2014 - http://www.forbes.com/sites/csylt/2014/09/10/magical-makeover-drives-disney-store-revenue-to-760-million-in-the-uk
  3. Amdocs Blog, “The Wonderful World of Disney Analytics,” June 2014 - https://blogs.amdocs.com/voices/2014/06/04/he-wonderful-world-of-disney-analytics-reporting-from-tm-forumlive-nice-juan-gorricho/#.V-EQ6CgrKUk
  4. Bloomberg Businessweek, “Disney Bets $1 Billion on Technology to Track Theme-Park Visitors,” March 2014 - http://www.bloomberg.com/news/articles/2014-03-07/disney-bets-1-billion-on-technology-to-track-theme-park-visitors
  5. Disney Parks Blog, Taking the Disney Guest Experience to the Next Level, January 2013 - https://disneyparks.disney.go.com/blog/2013/01/taking-the-disney-guest-experience-to-the-next-level/
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