Disney Conquers New Kingdom

When Disney (NYSE: DIS) launched its interactive Virtual Magic Kingdom game nearly two months ago, it pointed to July as the month when the fun was really going to get started. The free online experience, which allows registered users to flesh out their avatars and stroll through a simulated Magic Kingdom, is doing just that.

Dedicated kiosks have opened up at its Florida and California theme parks, which are offering more than just a place to pitch a tent and promote the game to park visitors. Active players can visit the theme parks and take part in scavenger hunts. Those who successfully complete the challenge are rewarded with secret codes that can enhance the gaming experience online. The successful players also are eligible for perks, including a guided tour of the actual theme park.

The master plan is brilliant: Get folks to the parks. Then make sure they don't forget about the parks when they return home. Along the way, a young generation will start thinking that Disney is cool again, and that's crucial, since rival film studios are wresting the animation crown from Disney. It needs to find a new way to remain relevant to the young yet vocal generation that packs veto power when it comes to planning the next family vacation.

Disney is never going to build the biggest roller coasters. It will leave that game to Six Flags (NYSE: PKS) and Cedar Fair (NYSE: FUN). But that's why Virtual Magic Kingdom works so well. Disney is using the Internet to draw an audience as well as differentiate itself from the regional amusement-park experience.

I had once heard an interesting case being made that Motley Fool Stock Advisor selection Electronic Arts (Nasdaq: ERTS) could become the next Disney. Maybe it's the other way around. Virtual Magic Kingdom isn't the only ace up Disney's dot-com sleeve. Internet users can now also play along with Disneyland guests at Buzz Lightyear's Astro Blasters attraction.

Disney gets it, and it's partnering with sponsors to make sure that your kids get it, too. This month, the company teamed up with Kellogg (NYSE: K) for a special merchandising promotion that puts three secret codes inside select breakfast cereal boxes.

Granted, Disney and Kellogg were a bit wet behind the ears on this one. Instead of generating unique one-time codes, they went with universal ones. In other words, search the Web and the three secret powers can be yours for the browsing. Still, the promotion has its heart in the right place. It's probably just a matter of time before Eastman Kodak (NYSE: EK) wants to be the official sponsor of the digital camera used in the game to take virtual snapshots. And don't be surprised if the local Main Street cinema starts promoting the latest Disney flicks.

Yes, I imagine we can't be too far away from the moment when some of the shirts and pins that the gamers are donning as avatars will be available for real-world purchase too. Disney is really just scratching the surface here. Let's hope the itch doesn't go away.

Some more virtual headlines:

• Disney launched the interactive experience back in May.
• I took a closer look at Virtual Magic Kingdom, 30 days into the beta test.
• Great timing, too, as Disneyland celebrates its first 50 years of operation.

Longtime Fool contributor Rick Munarriz has played Virtual Magic Kingdom to earn some of the pins that his avatar is wearing. He prefers the real thing to the virtual version, but he'll take what he can get. He owns shares of Disney and Six Flags as well as units in Cedar Fair. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.