Sentinel reports that MyMagic+ executive vice president Nick Franklin will be leaving in July

[Ignohippo]

Thank You.

Quoted for the reminder. On a thread about an executives departure ("polite" firing) we are being drawn into discussions on every possible tangentially related point except an executives departure from The Walt Disney Company.

When the executive just happens to be the one in charge of NextGen, it would only be likely that NextGen would be discussed.

 

[Mammymouse]

The original budget was $1B. I'm not up to date on the new and improved math, but 4 times $1B = $4B on most calculators.

They must be using Common Core math.

 

[The Mom]

When the executive just happens to be the one in charge of NextGen, it would only be likely that NextGen would be discussed.

As long as they are not personal anecdotes about its usage, as we all know that everyone will not have the same experience.

 

[Rteetz]

I've read the earnings press releases, the quarterly earnings call transcripts, and the company's 10K & 10Q filings. There is no information so far indicating that MyMagic+ has made a dime.

All of WDW's gains have been driven, as usual, by "higher ticket prices, food and beverage and merchandise spending". This is exactly what's been driving WDW growth for the last 3 years, well before the advent of MyMagic+.

In the business world, "working" means providing a positive return on investment.

There is absolutely no publically available information to suggest that MyMagic+ is "working".

I see mymagic+ as more of infrastructure work where Disney won't see a return investment yet. This system is essentially putting everything together. Did the old fastpass system make money? This system is trying to get people to spend more in the hotels and in the parks therefor that goes to food and merchandise not necessarily mymagic+. We should look at increases in guest spending in those parts. Mymagic+ won't make money itself. I also think Disney is doing this the best way they can if Disney just put the system out there when originally planned it could have been a bigger disaster and cost even more than it already has. Taking it slow in my opinion was the best thing for Disney to do.

 

[sweetpee_1993]

Why don't you get that people lie? So an insider can lie but a supposed "reputable source" can't lie as well?

You want to argue for the sake of arguing.

Because if its on the internet it has to be true.

Bonjour.

 

[pheneix]

I interrupt my WELL EARNED Faux Top One Percent Spirited Spring Holiday to say ... Well, y'all just largely don't have a clue how media goliaths like Disney operate and you absolutely don't get why Franklin's contract isn't being renewed.

I leave and you let a wannabe dictate discussion? C'mon, I expect better from all of you.

Poor Georgie K. For a top guy, he's very likely next to find out what being on the bottom is all about. Well, after Georgie asks MacPhee to leave first.

Hahaha I'm a little letdown. The best gossip going around DisneyVerse right now is the 2nd park that is getting rushed for Hong Kong Disneyland that Disney *really* would rather not have to own up because of its operations in other markets.

But a second park for Hong Kong is definitely on the way and on a fast track. Ownership agreement with HK SAR calls for SAR to slowly increase their ownership stake to over 60% in the coming years. They will have effective control over their resort much in the way that OLC has. Disney has to wring cash out from HKDL and they have to do it now because as they have learned in Japan, a stable and long term-minded theme park operator does not share in the lack of vision and values as Disney does. They simply will not grow earnings as fast as Disney demands.

 

[seascape]

I see mymagic+ as more of infrastructure work where Disney won't see a return investment yet. This system is essentially putting everything together. Did the old fastpass system make money? This system is trying to get people to spend more in the hotels and in the parks therefor that goes to food and merchandise not necessarily mymagic+. We should look at increases in guest spending in those parts. Mymagic+ won't make money itself. I also think Disney is doing this the best way they can if Disney just put the system out there when originally planned it could have been a bigger disaster and cost even more than it already has. Taking it slow in my opinion was the best thing for Disney to do.

The way to judge if the technology is working is different for on site and off site quests.

For on site guests Disney can determine if more of them are staying on site more often and going to Disney parks and Disney Springs.

For off site they will be able to see how many of the tourists are going to their parks and for how many out if their week vacation.

With this information they will be able to determine what new attractions need to be built. They will also be able to send surveys to only those they know can spend more time on property to find what they want.

First on site

 

[wdisney9000]

I see mymagic+ as more of infrastructure work where Disney won't see a return investment yet.

Good thing the execs didnt tell the BoD that they would see a ROI by 2013...oh wait..

 

[tribbleorlfl]

Did I read the article right that Mr. Franklin was in charge of P&R's Real Estate division prior to being tapped to he's NGE? No wonder this thing had such a rocky development and rollout. Seems like he was set up to fail.

 

[Fe Maiden]

Not much better. His idea of vacation needs tweaking. I got off the Dream last week and doing the Fantasy next week before the summer vacation hoards crowd the ships and keep the prices up. That is a vacation @WDW1974.

I'm sure he's doing just fine, no tweaking needed. Now admittedly with 3 kids it's been a awhile, but I can assure you the real fun on vacation doesn't even begin till 1am. There's the people who can hang and the others that go to bed. Usually the people who hang are rewarded with an experience you don't usually find in the brochure. Especially on a cruise, since that's when the staff unwinds. My wife and I spent many a night with the officers and entertainment staffs of RCI, Princess just hanging out in one of the lounges (and no need to worry about paying for drinks, just help yourself). You decide to pack it in around 5am, head up on deck to watch the sunrise, have breakfast, and go to bed. Believe me, that's a vacation too.

 

[sweetpee_1993]

I'm sure he's doing just fine, no tweaking needed. Now admittedly with 3 kids it's been a awhile, but I can assure you the real fun on vacation doesn't even begin till 1am. There's the people who can hang and the others that go to bed. Usually the people who hang are rewarded with an experience you don't usually find in the brochure. Especially on a cruise, since that's when the staff unwinds. My wife and I spent many a night with the officers and entertainment staffs of RCI, Princess just hanging out in one of the lounges (and no need to worry about paying for drinks, just help yourself). You decide to pack it in around 5am, head up on deck to watch the sunrise, have breakfast, and go to bed. Believe me, that's a vacation too.

I want to give this heavenly post a big ol' hug.

 

[disney4life2008]

Here is my take: Deep down the higher ups "I think" regret Next Gen and FP+. The amount that it has costed (while they will never admit it) has been problematic since the start. Every comment from Staggs has said that magic bands have dramatically increased spending and as a result food/beverage/merchandise spending is up. I do not buy it (never did). While the MB allows for easier spending - I can only see it increasing by a small percentage (at the 100% confidence interval level). As for FP+ - while it allows guests to reserve from home it remains a nightmare. Why fix something that never needed to fixed in the first place. And if I recall FP+ is heading to Disneyland next - at least that is what original documents said. Billions of dollars could have been used to rebuild HS because it is suffering badly.

 

[wdisney9000]

Also according to the reports 75 percent of those staying on property are using it. That is higher than those who used the old system.

Guests were not FORCED to used the old system. So that 75% isnt anything impressive. Is there even a true way to qauntify how many guests actually used legacy FP? Disnay and fans alike tout numbers like "75% of guests are using this new system" but fail to mention that its basically required for you to use it to utilize FP+ to its full potential. Just another way they smear lipstick all over the pig and possibly as to why "Nick" (i love how people use his first name like they are friends) is leaving.

All the spin is starting to unravel in the sense of what wall street is seeing financially. Sure, guests of WDW enjoy the features of MM+ like advance FP booking but the ability to book a FP 60 days out or use the band to open your room door isnt exactly equating to huge profits (yet, maybe never). The infrastructure aspect and its financial ability still remains cloaked. I can only venture a guess that all the extra offerings like Harambe Nights, Epcots "pay us to drink at night" thing, longer F&W schedule, and earlier MNSSHP dates are all ways to increase the bottom line to show ANY type of profit they can attribute to NexGen. The average guest doesnt know these things but the BoD may finally be waking up to the shell game Iger and Rasullo are playing and now "Nick" either sees what is coming and jumping ship or they told him to jump.

 

[flynnibus]

Did I read the article right that Mr. Franklin was in charge of P&R's Real Estate division prior to being tapped to he's NGE? No wonder this thing had such a rocky development and rollout. Seems like he was set up to fail.

Yeah, global stuff too.. so he was a player in arranging Shanghi, etc. The guy has had quite an executive career within the business side of P&R

 

[GiveMeTheMusic]

I was under the impression that Franklin was the one behind the Disney "regional entertainment center" concept for places like Singapore and Malaysia that never came to fruition and that that was his main role in real estate prior to NGE. Could be wrong.

 

[Soarin' Over Pgh]

I'm three pages behind so I apologize if this has been said, but...

Of course that 10 years is only an example, but let's say they internally want to see positive ROI over the 10 year period. As you noted, that's $100M per year average. How many customers do they have a year? Can't really base it on turnstyle clicks, but would 10M be a fair estimate (probably low?). If so, that's only $10 increased spending per customer per year. Now, once they fully roll out the project, they will have multiple positives they are looking for...

1) get more people onsite (resort stays = more money for Disney)
2) get more people happier in the parks due to FP+ and better crowd control (happy customers spend more on food and spur of the moment purchases)
3) increased spending due to understanding the consumer wants, needs, high points and low points (that nasty data mining actually being used) and
4) increased spending due to localized marketing with texts, notifications (my bet is this is coming soon)

All those points can lead to increased consumer spending. If it's $20/yr, they double their money. What happens if it's $50/year? Now I think we're starting to see how they could see some really good ROI on this project. But, it may take some time for everything to get rolling. Plus, as with many major projects like this, corporations tend to long haul their ROI. So, the first couple of years will have lower ROI and future years will have much higher ROI as the system matures and they add more features. NextGen is a whole new outlook on how WDW interacts with their consumers.

You know how else to increase guest spending by more than 11% without spending 2 billion dollars?

1) Unique park merchandise.
2) Unique hotel merchandise.
3) Unique ride merchandise that caters to all age groups, not just the flighty minded 4 year olds. The shop by the Haunted Mansion last May catered to those 3-6 and 40-60 and no one in between. HM themed lollipops, flashy things, mirrors, and then $150 gargoyles and $200 crystal balls. C'mon Disney. Do better. Nothing for the up and coming crowd, the newly married couples, etc?

It's a lofty goal, but doable via multiple streams.

1) Increased on-site bookings
2) Increased spending on drinks and meals... Just an example - family may normally get to the park in the morning, tour, have lunch, tour some more and then head back to the resort for a meal offsite or in their room. However, now, they have a FP+ for the fireworks / late night ride and stay in the park and eat dinner.
3) Increased spending on souvenirs - localized text from Disney when they walk out of Mouse Gear without a purchase with a 10% coupon good for 2 hours. Head back in and make a spur of the moment purchase.
4) Increased length of stay -- planning their vacation, make their FP+ selections, and decide they want another day to be sure they have passes for other attractions they didn't have earlier.
5) Ease/opportunity of spending - I'd like to find an article I read a while back about loyalty cards with 0% financing specials and how much it increased spending in the moment. We all know that people fall for those opportunities where businesses hold out a hook and people grab - financing specials, coupons, quick options, etc. People that pull dollar bills out of their wallet spend less than people that pull out their credit card. Reduce that barrier even more - hold up the magic band, and there will be increased spending. Amazon didn't patent the one click purchase just for the fun of it!

Aaaaaaand again.

1) Make people want to stay at your hotels, plan and simple. It's all about the $$$$.
2) Unique food and drinks to quick service locations and hotels. If there was just one place in the MK that offered a ramen cabbage salad, you bet I'd hike there for that specifically. Instead, its all generic crap, recycled ad nauseum, all over the park. What about those people (like me) who can't stand hamburgers and hotdogs and greasy fries for more than... one sitting?
3)See above.
4) See #1...
5)I dunno dude. I find it very easy to whip my debit card out and have no problem using it. I don't think people are so dense that they need coupons and programs and rewards and benefits and what have you. I don't see the magic band making people suddenly forget that bottom dollar number in their bank account and spend freely. People still think within budgets (at least, I hope they do) and being able to swipe their wrist over a scanner isn't going to temporarily blind them from what they're actually spending.


I'm not arguing or disagreeing with you-I'm totally with you on your points above but really, was a $2 BILLION magic band really worth it?

I'm thinking Disney went about this all wrong. And this guy I think is gonna be the scapegoat for it. I'm pretty sure I remember a certain Spirit saying someone is gonna take the fall for this, but I don't recall him pegging down a name. Does anyone have the patience to hunt that down in one of his previous posts?

 

[flynnibus]

I'm not arguing or disagreeing with you-I'm totally with you on your points above but really, was a $2 BILLION magic band really worth it?

So is it $2billion for FP+ or 2billion for Magicbands? I keep forgetting what argument people are having today...

1) Unique park merchandise.
2) Unique hotel merchandise.
3) Unique ride merchandise that caters to all age groups, not just the flighty minded 4 year olds

Spending, maybe.. but does any of that help lock/convince people into visiting your park vs others in unique ways the competition has a hard time replicating?

 

[sweetpee_1993]

So is it $2billion for FP+ or 2billion for Magicbands? I keep forgetting what argument people are having today...

I find it doesn't matter much what topic it is, it'll get argued and it'll be fun to watch. Here, pull up a chair and I'll get the drinks. The show is particularly fun when @WDW1974 comes in with the flying elbow off the top rope. From Trader Sam's perhaps?

 

[flynnibus]

@The Mom - yet when we look at what the NYT refers to as the 'multifaceted system' - their own reference is to

"The initiative is part of a broader effort, estimated by analysts to cost between $800 million and $1 billion, to make visiting Disney parks less daunting and more amenable to modern consumer behavior."

The 'broader effort' includes a lot of stuff and deliverables.. not just MagicBands.. my point was.. every time someone wants to rag on one of the elements in a 'was it worth it' way.. they hang the TOTAL spend on one thing... conveniently glossing over everything else. It's like saying your house's windows cost $500k because it's a 500k house.

 

[PhilharMagician]

Even worse for future growth, the last 3 consecutive years of 8% growth per annum is the highest ever in the 40+ year history of WDW.

The problem is very simple. Disney can't keep trying to squeeze blood from a stone.

As I've posted before, the problem is represented by this:

[.

Exactly! 8% per annum is insane growth let alone expect to reach 11%. I can see a possible one time bump of 11% based on operational changes and increased efficiencies, but to expect guests to increase spending 11% year after year? This continued increase in revenue at this high rate is truly impressive but I have to think that the pixie dust will run out soon. People only have so much money to spend.