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332 Chapter 12 • Customer Relationship Management

CASE 12-1
Opening Case
Walt Disney’s CRM Strategy

Source: Based on article by D’Agostino, D. (December 1, 2003). Case Study: Walt Disney World Resorts and
CRM Strategy, CIO Insight. www.cioinsight.com/print_article2/0,1217,a=114960,00.asp
Disney was founded on October 16, 1923. The company presently has a wide portfolio of
businesses, ranging from film to animation, theme parks, distribution, retail, television, music,
and almost every aspect of the entertainment industry. Their commitment to entertainment has
made them one of the leading and arguably the most popular entertainment companies in the
world. Disney’s total revenue for 2005 was $32 billion, and they currently employ 133,000
full-time employees worldwide, with significantly more part time. Disney currently has approx-
imately 100 million people per year visit their stores and theme parks across the globe.
In order to improve the customer experience at Disney while simultaneously lowering
the customer service cost, Disney is integrating such cutting-edge information technologies
as the Internet, customer relationship management (CRM), and mobile connectivity. One
example of this technology leveraging is Destination Disney. Disney experienced data issues
that would make simple tasks such as tracking repeat customers while visiting their parks.
Disney wants all the data accessible in real time to track the individual customer’s buying
behavior and personal preferences to be able to create easy-to-book Web sites for groups of
people to plan their Disney activities.
Another example is the creation of a mobile CRM device called “Pal Mickey,” a
10 ⁄2-inch-tall stuffed doll with a central processing unit, an internal clock, small speakers, and
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a powerful infrared sensor in its nose. Disney park visitors are often frustrated with long
lines and crowds at the amusement parks after paying a high entrance fees. Pal Mickey acts
as a virtual tour guide, providing tips on which rides have the shortest lines and information
on events. As the doll moves through the park, the sensor receives a wireless data upload
from one of the 500 infrared beacons concealed in park lampposts, rooftops, and bushes
that transmit location-centric information from a Disney data center. The signals let Pal
Mickey know when to inform the owner of an event. For example, when it receives a new
piece of information from a nearby beacon, it giggles and vibrates to indicate that it has
something new to say. Squeeze its hand or stomach and Pal Mickey will tell you about an
upcoming parade, a shorter line at another ride, or trivia on the current location of the park.
With more than 700 prerecorded message variations, Pal Mickey always has something to
say, whether it’s telling a child a corny joke or keeping kids entertained with interactive
games while they wait in line.
Pal Mickey is an example of bridging the gap between static customer support and
dynamic customer support based on the customers’ behavioral preferences, physical
location, and movements at any given time. In other words, it’s all about “dynamically
matching data with context—a new concept and the next big development in the evolution
of CRM,” in the view of futurist Paul Saffo, research director of the Institute for the Future
in Menlo Park, California, a technology think tank. Another futurist and business strategy
guru, C.K. Prahalad, the Harvey C. Fruehauf Professor of Business Administration at the
University of Michigan Business School and coauthor of The Future of Competition
(Harvard Business School Press), agrees: “Disney is experimenting with a customer strategy
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