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Information is power. Netflix (NASDAQ: NFLX ) investors saw that on display last night as the leading streaming service's evolving recommendations engine has helped it grow to 48.35 million online subscribers.
We'll see that on display again come Thursday afternoon when Amazon.com (NASDAQ: AMZN ) reports. It has turned its in-depth knowledge of customer transactions to offer up related picks when shoppers return to its landing page.
If Disney's (NYSE: DIS ) $1 billion bet in ride reservation technology pays off, we may also eventually see FastPass+ as another instance where buying into information has paid off in a major way. Disney's new ride reservation system may seem to be all about keeping guests out of long queues so they can spend more time eating, drinking, and shopping at its theme parks, but it's ultimately about information.
What rides are guests going on? What characters are they singling out for interactions? Guests staying at Disney's resort hotels also get charging privileges with the RFID MagicBand wristbands that they receive, arming Disney with even more personalized data.
Disney can probably do a lot more than you think with all of this information. Let's revisit Netflix and Amazon. The recommendation engines for both sites are difference makers. One can argue that Netflix's success has come on the strength of its growing catalog of licensed content, but how do you think the service decides what shows and movies are worth paying up for? Netflix's awareness of subscriber viewing habits guides its programming decisions. It's not all that different for Amazon, where it's able to make stocking and marketplace decisions based on growing gobs of data.
However, the real gem for all three companies is how they can use customer-specific information to improve that particular relationship. Disney will now be able to track the attractions and character interactions that you and your family ride the most, and you can be sure that the family entertainment giant will use that to market merchandise and more experiences in the future. If you keep booking Toy Story Mania and Buzz Lightyear's Space Ranger Spin, Disney's going to assume that someone in your family is a pretty big Toy Story fan. Given the choice, do you think the House of Mouse will shy away from using those characters in pitching future park treks your way?
It's not just about the rides, of course. If you keep ordering meatless dishes at the parks, will Disney market differently under the assumption that you're a vegetarian? If your FastPass+ reservations are routinely for thrill rides, will Disney tease you with info on new coasters? Knowledge is power, and a smarter Disney will be a wealthier one.
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