Data Mining Disney -- A Magical Experience

[Yellowstonetim]

A very good article on data mining and magic bands on the Tech Blog for Huffington Post. Some interesting info. The man works in the industry. Regardless of what anyone says at Disney, the real purpose and value of the magic band is the data mining and what Disney will learn. This type of information is going to literally change the world.

http://www.huffingtonpost.com/shelly-palmer/data-mining-disney_b_7251792.html

 

[wallrock]

A very good article on data mining and magic bands on the Tech Blog for Huffington Post. Some interesting info. The man works in the industry. Regardless of what anyone says at Disney, the real purpose and value of the magic band is the data mining and what Disney will learn. This type of information is going to literally change the world.

http://www.huffingtonpost.com/shelly-palmer/data-mining-disney_b_7251792.html

I agree that Disney will certainly benefit, but I wouldn't call this world changing. Instead I'd say that it's Disney catching up and perhaps taking an additional step or two. Data mining has been going on since Columbia House sold their first bundle of records for a penny.

 

[Yellowstonetim]

It isn't data mining itself that is exceptional. It is the data mining in the theme park setting and the type of information they will be able to evaluate. The total amount of information they will have on me and how it can be crunched and analyzed is a huge deal. This has never been done to this detail on a similar sized population as far as I know. They are not just going to know everything about me, they are going to know where I walked, what I ate, how long I spent in each store and exactly what I bought. They will know this for millions of customers. This, as the writer notes, will bring great change.

 

[Josh Hendy]

I can't think of a single valuable insight you would get from billion-dollar system to track people's movements and spending patterns in the Magic Kingdom that you couldn't get from spending a couple of days walking around the park.

Do you have to mine data from wrist bands to find out that people like to go on exciting theme park rides without too long of a wait, they enjoy eating high quality food at a reasonable price, and they like to shop for interesting, unique and reasonably priced clothes and souvenirs? And that they'll leave early and go watch TV or swim in their hotel pool if they don't get those things? And then next year maybe vacation somewhere else.

I don't have a billion terabytes of data and a team of programmers and financial analysts to back me up on this but I can assure you ... nine out of ten theme park guests conform to this behavior, 18 times of 20 on a standardized scale adjusted for seasonal and weather-related variations.

You know what they say ... "You can track a horse with an RFID wrist-thingie all the way to the water, but you can't make him drink."

 

[Tigger's ally]

I have worked in data mining for 25 years and I have to totally disagree with everything you say there Josh. Just the data concerning age and exact average hours per park for each age group would be interesting. How long do Canadians spend in Canada? How would you know such things by just walking around the park. How would you know who are Canadians. How would you know what 29 year olds do vs. 31 year olds? So much that interests me.

 

[wallrock]

I have worked in data mining for 25 years and I have to totally disagree with everything you say there Josh. Just the data concerning age and exact average hours per park for each age group would be interesting. How long do Canadians spend in Canada? How would you know such things by just walking around the park. How would you know who are Canadians. How would you know what 29 year olds do vs. 31 year olds? So much that interests me.

It sounds like though you're talking about personal interest in metrics as opposed to Josh's reference to the commercial value. Big difference between the two.

To his point, you can't make people spend money regardless how much tracking information you get.

Disney may know where you go and which shops you enter, but it doesn't tell them much if you don't walk out with anything. You could be in there to get a breath of cool air to combat the heat of the summer. Further, as long as Disney sells the same products in each store how valuable is the information if you buy a Mickey plush in Animal Kingdom vs Epcot? Disney started to head in the right direction with Haunted Mansion specific items in Memento Mori, but has since slipped because they're now selling many of those products in other gift shops.

 

[JenniferinFL]

I can't think of a single valuable insight you would get from billion-dollar system to track people's movements and spending patterns in the Magic Kingdom that you couldn't get from spending a couple of days walking around the park.

Do you have to mine data from wrist bands to find out that people like to go on exciting theme park rides without too long of a wait, they enjoy eating high quality food at a reasonable price, and they like to shop for interesting, unique and reasonably priced clothes and souvenirs? And that they'll leave early and go watch TV or swim in their hotel pool if they don't get those things? And then next year maybe vacation somewhere else.

I don't have a billion terabytes of data and a team of programmers and financial analysts to back me up on this but I can assure you ... nine out of ten theme park guests conform to this behavior, 18 times of 20 on a standardized scale adjusted for seasonal and weather-related variations.

You know what they say ... "You can track a horse with an RFID wrist-thingie all the way to the water, but you can't make him drink."

That's what we all think we want. But, often human behavior reflects something different. Disney is well aware of what makes a lot of us happy. But, what Disney wants to know is which group DISNEY cares to make happy. In other words, what do the people who spend the most want? What makes them happy? It is obviously more profitable to have a park filled with the people who buy the merch and eat the food rather than the people who pack their own PB&J and spend the whole day riding or waiting for headliners.

 

[Mouse of Mystery]

I have to disagree with anyone that discounts the enormous value of the data being collected. If you can't see it, then you just don't understand. I have a 20+ year background in retail at the corporate level. I've worked with merchandising, marketing, purchasing, and data analysts in that time. There isn't a company in the world that wouldn't love to be able to track people through an environment like WDW.

If you are disgruntled with seeing the same merchandise in multiple shops and it turns out that you are not alone, then I guarantee you Disney will see this in the data and react accordingly. The downside is that if they believe that spreading best-sellers around the park regardless of theme is working, then you'll continue to see status quo.

Keep this in mind: tracking inventory movement is industry standard. Most retailers can see items sell on a daily basis, if not in real time. They also study patterns and make merchandising and marketing decisions based on that data. But imagine being able to tell not only whether or not someone bought an item on their visit to a particular shop, but their age, the number of people in the party, where they've just been, how long they stayed, and where they are going. The possibilities are endless, and I think, ultimately, it's going to help them make better decisions that maximize profits. If keeping the theme of a particular land or park is as important as you believe it to be, then it will change.

If anything, I expect them to fine tune the capabilities of the system to increase precision and capture more data points. Like it or not, do not discount the power of what they have created here.

 

[Josh Hendy]

I saw a headline the other day that major retailers are closing more than 6,000 stores across North America due to slumping sales. Including some of the very biggest companies with access to the most sophisticated data analysis in the world.

Is it because they didn't have large enough databases with sufficiently detailed inputs related to age, income and shopping habits? Or is it because they became infatuated with massive investments in IT data collection and analysis to the point where nobody responsible for making the big decisions ever bothered to visit the stores any more, walk around the neighborhood, and talk to the people who might or might not want to shop there?

 

[lockedoutlogic]

I agree that there is a lot of potential for them to collect more detail than even their own world class data skills have been able to generate at this point…

My question is…what are they gonna SELL with it? As in what do they have to offer under the current circumstances based on hotels, park status, and attendance levels?

Oh yes…i'm suggesting this leads directly to ground zero for the arguments on most of these here threads as of late…you have to HAVE something to sell. They've overexposed their inventory. One of the things that was always pushed behind the scenes - back in the day - was how to sell "underexposed" products. There was a department - OPSC - that dealt with that exclusively…
I think this is an area where Iger and Co are being duped - they're being fed from the ground that there is all this money to be made from existing things (i.e. no/low cost)…
But here's the kicker - those departments had ALWAYS done that (because it was usually the truth) but that was under an entirely different operation/investment model in Orlando….the one carried by Don Tatum, Card Walker, Ray Watson, Eisner and Wells. You can be the biggest Iger supporter on earth and can't, legitimately, say that he puts anywhere close to the same priority on the citadel…not if you want to be taken seriously.

More exclusive tours and premium prices? Thats the thought…but do you notice how limited those tours are?…its not like you see groups of 100 out on kilimanjaro or the "villains soiree" with 600 people…
there is a glass ceiling hanging very close to their heads on those already.

oh…and direct marketed merchandising…good luck there.

 

[DDLand]

I saw a headline the other day that major retailers are closing more than 6,000 stores across North America due to slumping sales. Including some of the very biggest companies with access to the most sophisticated data analysis in the world.

Is it because they didn't have large enough databases with sufficiently detailed inputs related to age, income and shopping habits? Or is it because they became infatuated with massive investments in IT data collection and analysis to the point where nobody responsible for making the big decisions ever bothered to visit the stores any more, walk around the neighborhood, and talk to the people who might or might not want to shop there?

Or because of increased movement towards the likes of Amazon... Who might I add has excellent analytics and tracking on each of us, and can provide suggestions based on our preferences.

 

[LegoMom3]

Here's a question re: exactly what Disney is "mining" from me: Say I wear a MagicBand for my admission and room key. However when I enter a restaurant or gift shop, I pay in cash. Will they only know that I entered each establishment in that case, but not necessarily what I purchased? I would assume they track specific spending habits IF I am using the Band to pay? I'm just curious on this one.

.

 

[DDLand]

It sounds like though you're talking about personal interest in metrics as opposed to Josh's reference to the commercial value. Big difference between the two.

To his point, you can't make people spend money regardless how much tracking information you get.

Disney may know where you go and which shops you enter, but it doesn't tell them much if you don't walk out with anything. You could be in there to get a breath of cool air to combat the heat of the summer. Further, as long as Disney sells the same products in each store how valuable is the information if you buy a Mickey plush in Animal Kingdom vs Epcot? Disney started to head in the right direction with Haunted Mansion specific items in Memento Mori, but has since slipped because they're now selling many of those products in other gift shops.

You don't understand Wallrock. By tracking who buys what where they can dynamically adjust inventory deployment in the stores to best meet the demand. If they track a high volume of young kids coming through a store they can increase inventory of goods that target these young kids. They find that teens are moving through certain stores in higher frequency they can adjust merchandise to meet that demand. What's for sale does effect purchases. In the same way many buy what's in their suggested baskets on Amazon, if there's a compelling product for sale then they'll sell more.


Also, if they tracked in previous years that guests went to certain retailers in greater frequencies in recent years, they can increase cast deployment preemptively.

As for your theoretical, Disney would know you never bought somthing because there'd be no purchase on record.

 

[DDLand]

I still don't think that this is the "real" reason that Magic Bands came into existence. That's way too simplistic. A contributing factor? Sure. He just misses out on the moat it provides and the ease of use side of things. I think those two factors are bigger than data mining.

Also... He called Walt Disney World "The Happiest Place on Earth." It is not the happiest place on earth... That's Disneyland. Walt Disney World is "The Place Dreams Come True." Pet peeve of mine.

 

[davper]

Disney may know where you go and which shops you enter, but it doesn't tell them much if you don't walk out with anything. You could be in there to get a breath of cool air to combat the heat of the summer. Further, as long as Disney sells the same products in each store how valuable is the information if you buy a Mickey plush in Animal Kingdom vs Epcot?

The fact that you didn't buy anything is important to Disney. They want to know why. If they are able to sell a plush in one store but not sell it in another, that will have them comparing stores and displays to determine the cause and adjust accordingly. It could

If it turns out that people are just there for the A/C, that will cause Disney to adjust. Instead of selling plushes, they change that spot to refreshments and cooling aids.

Don't under estimate the value of long-term collection of minutia. Behaviorists and marketing professionals will determine how to get every last cent out of your pockets. It is this collected data that has determined that you can charge more because of the illusion of value or higher quality. When in fact, there are none.

 

[davper]

Here's a question re: exactly what Disney is "mining" from me: Say I wear a MagicBand for my admission and room key. However when I enter a restaurant or gift shop, I pay in cash. Will they only know that I entered each establishment in that case, but not necessarily what I purchased? I would assume they track specific spending habits IF I am using the Band to pay? I'm just curious on this one.

.

Your band and ticket have a Radio Frequency ID. You will not have to make a purchase using the band. They can associate your purchase with the closest non-CM RFID.

 

[Tonka's Skipper]

What most people don't know is with your credit and debit cards, phones, cams, facial ID, information brought by many information collections groups, all this data is already available on the markets to anyone or company. I lot ore then anything the MB is collect. As a post poster said............Disney is just catching up to what companies like Amazon and others already are colleting.


What stuffed Disney character or items you buy in the shops is really very minor and a non issue.

AKK

 

[davper]

I saw a headline the other day that major retailers are closing more than 6,000 stores across North America due to slumping sales. Including some of the very biggest companies with access to the most sophisticated data analysis in the world.

Is it because they didn't have large enough databases with sufficiently detailed inputs related to age, income and shopping habits? Or is it because they became infatuated with massive investments in IT data collection and analysis to the point where nobody responsible for making the big decisions ever bothered to visit the stores any more, walk around the neighborhood, and talk to the people who might or might not want to shop there?

That data analysis likely told them that they could maximize profits if they closed locations where the customer base didn't mind traveling to the next town to get what they were looking for. Or it could be that their customer base has changed to purchasing online.

The more data you can collect, the better the decisions you can make.

I'll give you a ridiculous example...
Let's say I am tracked at work. They track how often I go to the bathroom. They track how long it takes for me to be away from my desk to go to the bathroom. If it takes me more time than someone in another department, they will start to research why. Let's say they figure out that every male takes longer than average in my department. This deviation is costing an extra 30 minutes a day per person. That is a lot of time. So they study the traffic pattern. Is the bathroom too far, is it over capacity, or is the path that gets you to the bathroom going past the women's gym with with the large windows.

Once you know, you can determine if the fix to correct this deviation is worth the investment.

 

[lockedoutlogic]

You don't understand Wallrock. By tracking who buys what where they can dynamically adjust inventory deployment in the stores to best meet the demand.

I think you are absolutely 100% right that this is the thought pattern behind retail tracking.

I also think it's completely wrong... If they honestly think the problem is "where they put it" and not "what they're putting there - in repitition"...they are failing to grasp the world they've created.

This would have been far more valuable 20 years ago when they carried a variety of location specific merchandise.

The hints are there... Why are they selling "exclusive merchandise" both in the parks and via the Disney store now in small batches?
It costs more to do that...so why not stick to the Disney parks garbage from shanghai?

I haut got an email about a Rio Del Tiempo t shirt...
Where's that coming from?

They systematically took away resort merchandise a couple of years ago and they pulled a hard, hill street blues issue 180 on that.

Because there's a growing discontent with the stuff... And my spidey senses are telling me they know it...

So it could be that one of the original intentions of bands - to match up the walmart grade stuff with the poor schleps who "couldnt find it " (think about that idea for a second)...is going away.
Plan B time.

 

[wallrock]

The fact that you didn't buy anything is important to Disney. They want to know why. If they are able to sell a plush in one store but not sell it in another, that will have them comparing stores and displays to determine the cause and adjust accordingly. It could

If it turns out that people are just there for the A/C, that will cause Disney to adjust. Instead of selling plushes, they change that spot to refreshments and cooling aids.

Don't under estimate the value of long-term collection of minutia. Behaviorists and marketing professionals will determine how to get every last cent out of your pockets. It is this collected data that has determined that you can charge more because of the illusion of value or higher quality. When in fact, there are none.

While I fully agree that Disney wants every bit of money you have (and don't have) it's next to impossible to derive analytics about why people didn't buy something unless you have direct interaction with them. Gift shops are spread throughout the parks, naturally where big streams of human traffic flow. They're not going to know that you went inside for a breath of cool air unless someone asks. How many times does someone cross through an entrance of a gift shop just to take a short cut from one place to another? Waiting for a significant other to come back from the bathroom? Getting in out of the rain? And when that happens, Disney knows to bring out the ponchos to sell. Magic Bands and analytics didn't tell them to increase the poncho inventory on the shelves - seeing the clouds open up did.

The big difference between major retail sites and Disney is the diversity and the need of the product. People frequent Target or Wal-Mart because of the variety of items as well as the need for them (everyone needs to eat and buy toiletries on a regular basis). Buying patterns can be better discerned from those frequent customers. Disney on the other hand has many 'once and done' visitors who buy random souvenirs for folks back home or mementos to remind them of the trip, many of which I'd wager are bought at the last minute with little thought. The metrics outlined here don't help improve personalized or directionalized marketing (the key goal here in my opinion to increasing guest spending) if they don't return. Revenue in that arena depends largely on how much information a guest provides Disney in their My Disney Experience profile and retaining that information (along with purchases) for use in marketing on their next trip. Large scale monitoring will be of significant benefit in crowd management capabilities. That translates into better managing of how many cast members to have around and not 'over staff' areas (translation: fewer cast members equates to reduced operating expenses). Efficient staffing will be where the big financial gains come from.