RFID, is coming to a Disney park near you and much like winter is coming, there is nothing anyone can do about it.
For those of you living under the Tree of Life and who don’t know the story, it goes a little like this: Disney is starting to implement RFID chips into practically everything, from drinking mugs to next generation queues. They’re going to be a thing. A big thing. And it will probably change the way you vacation at Walt Disney World.
So, let’s try to look at some of the facts, what’s been done so far, and where is it going next.
For starters, RFID stands for Radio Frequency Identification. It’s basically a small chip that is embedded somewhere that sends and receives signals from another location. One of the biggest issues that arose last summer was when Disney started tested using RFID chips on refillable mugs and single use cups at the All-Star Sports Resort.
When it started, the online community was in an uproar. Limited refills, you say? How dare they! But let’s look at the facts about why that system was implemented and how it worked.
As most of you know, Disney offers refillable mugs to their Guests staying at certain resorts. You can buy one (or you get one for “free” when you get a dining plan), with the stipulation that you only use it during the length of your current stay. Disney puts you on the honor system, trusting its Guests to follow that one easy rule, and hoping everything is right in the world.
But some folks don’t play nice. They bring that mug back again. And again. And then again after that. Soon, the mug they bought in 2006 is looking awfully old school next to the brand spanking new ones from 2012 held by more ethical Guests.
So what does Disney do? Well, like any business, they’re putting a stop to it. Last August, they started testing a system at the All-Star Sports Resort which would limit the number of refills Guests can get using the RFID technology. Each mug will have a RFID chip embedded in it to keep track of your refills. When you get a refill, the drink dispensing machine will read the RFID chip and determine if you are eligible. If not, then no drink for you. Further, if you have gotten a refill with that cup in the last five minutes, then again, no drink for you.
You CAN, however, get water and ice. But that’s it, buddy. No more, no less.
Don’t think you folks buying a single serving cup can get away with it, either. You’re just as bad off. Those cheap Styrofoam cups ALSO have an RFID chip at the bottom, allowing you refills for up to one hour before the cup turns into a useless container (unless you choose to wear it as a cheap fez, which I wear mine as now. Because fezzes are cool).
Like I mentioned earlier, this entire debacle got the online Disney community into an frenzy.
“How DARE they limit my number of refills! I bought this mug back in 1999, and I can’t party like that without some Coca-Cola in my cup!”
Well, OK, maybe that isn’t an ACTUAL quote, but I’m sure someone, somewhere, has said that. Probably. More than likely. But maybe just in my head.
I know what you’re thinking, though. Sure, snagging a free refill with your mug from last year’s trip once or twice may do no harm. What’s a little free soda between old friends, right? But this issue isn’t really about those people. It’s about the folks who abuse the system. Yearly. About 10-12 times a day. In the grand scheme of things, a single refill of soda isn’t going to break the bank. But multiple refills, every year? That’s a lot of revenue lost.
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Let’s break it down by price.
A reusable mug costs an average of $12 to $14, depending on where you get it from. Assuming that the average price of a regular, single serving cup is about $3, a mug is the equivalent of 4 drinks. The average family will probably make use of all 4 of those refills, thus paying off the mug. If purchased on the first day of their average, seven day trip, I’d even go so far as to say that they would use that mug at least once a day, getting 3 extra refills for essentially nothing. But that’s a very low cost for Disney to willingly absorb for the upfront price of $12 for the mug itself.
Stick with me now, because we’re about to get all Donald Duck in Mathland up in here.
Looking at attendance rates, the average number of people visiting the Walt Disney World Resort in 2009 was about 1,400,000 a week. Let’s go out on a limb and say that 1/4 of those folks bought reusable mugs. So, if 350,000 mugs were sold at $12 a “pop” (you see what I did there?), that’s $4,200,000 right off the bat. That’s a lot of money.
Now, let’s take it a step further, and say about 1/4 of those mugs sold are brought back for next year’s vacation. So, 87,500 mugs are brought back, which is a loss of $1,050,000 of revenue for Disney. About a million dollars a week. Again, averaging it out, that’s about 52 million dollars a year. That… is more money than I can even begin to fathom.
Taking it even further, let’s talk about the number of folks who CONTINUE to bring that mug back. I’d say about 1/4 of those mugs, which is 21,875, come back to be used again and again, year after year. That’s another $262,500 a week, working out to $13,650,000 a year. Over ten years (which is possible, as I’ve seen lots of people with mugs that old), that’s $136,500,000!
So, again, what if those same mugs keep coming back, year after year? And then year after year after year after that? That money begins to add up quickly, which in turn, is a HUGE loss for Disney. Granted, I’m being VERY liberal with my numbers, and thinking that 20,000 mugs a week come back may be farfetched, but these are the type of numbers that Disney has to be looking at.
Now, some of you may be looking at the above numbers and saying “Who cares? They’ve been nickel and diming us for years, we should get some restitution.” Well, OK. I can’t really disagree with you on that. With recent price increases for tickets, along with everything else, I can definitely see where that frustration comes from, and for the most part, I’d have to agree with you. But you have to remember that, at the end of the day, Disney is still a business, and if they are losing money, they are going to find some way to recoup that cost.
So, in comes the RFID technology. But is it worth the price Disney is paying for it?
RFID isn’t anything new at Disney. In fact, they’ve been using it for years. Recently, however, there has been an influx of RFID through the Disney Company.
Ever been handed one of those lanyards with a red card just before you get on line for an attraction? You know, the ones that help determine the wait time, after you hand it to the Cast Member just before you get on the ride itself? That’s RFID at work right there! Disney’s PhotoPass card works the same way. The photographer takes your photos and scans your card to make sure all your vacation memories wind up in the same place. Aboard the new Disney cruise ships, Disney uses RFID in room keys to allow visitors to open their room doors, make purchases, and tons of other things as well. Recently at Disneyland, RFID chips are being sewn into Cast Member costumes to help organize and sort them.
While the RFID technology is all very similar, Disney does get different types of RFID chips from different companies. In the case of the drink dispensers, they are using ValidFill. According to their website, “ValidFill, LLC uses a patented solution to bring intelligence to beverage dispensing utilizing RFID Technology. By adding intelligence to the beverage transaction we measurably increase Food and Beverage revenue while positively affecting guest satisfaction, register throughput, shrink, and sustainability efforts. With the help of our partners, we are currently working with companies such as Royal Caribbean International, The Dollywood Company, and Osceola County Schools.”
With a little bit of a 1984-like feeling, according to their site, these chips can be used to track the cup type (hot or cold), cup size, location and date of purchase, number of times it has been used, number of refills remaining, and the last time it has been used. Not only is that pretty amazing, but Disney will get some pretty interesting statistics out of the deal.
The ValidFill system will allow you about 70 seconds for each refill before cutting you off. The handy dandy screens on the dispenser inform you when your next refill is available.
While they don’t include any prices on their site, further research shows that the same type of RFID chips that Disney is using for this venture cost about 7-15 cents apiece. Considering that Disney is buying them in bulk, we have to assume they are closer to the cheaper side of that range, if not even below it.
So, in the long run, after their initial investment into the system itself is paid off, Disney is spending very little per mug for RFID technology. They will be able to recoup most of their losses if they decide to implement RFID across all their Parks. Which, of course, they will.
We’re begun to see RFID stations pop up in front of attractions in the Magic Kingdom. We’ve heard about the incoming X-Pass (or whatever they are calling it now), which will allow Guests to schedule ride times months in advance of their actual trip. Heck, even the Sorcerer’s of the Magic Kingdom game uses a form of the RFID technology. Though not officially announced yet, it’s very probable that the new Disney App for iPhones, My Disney Experience, will interface with the RFID technology for the X-Pass.
Of course, people are going to call foul when it all starts rolling out for real. They always do, and already have. In the end, though, we can rightfully assume that this technology is here to stay. Disney is throwing a lot of money into this. Within a few years, this whole thing will be forgotten, and using RFID will be the norm. Instead of your grandparents telling you how they had to use an E-Ticket to get on the Haunted Mansion, you’ll be telling your grandkids how you actually had to stand in a line before getting onto a ride.
“There was no reserving your spot on Space Mountain months in advance…we had to walk barefoot, uphill, in the snow, if we wanted to enjoy Stitch’s Great Escape!”
So, prepare yourselves for RFID. It will be here soon, and it will become part of your everyday Disney life.
What are your thoughts on RFID? I’d love to hear what you guys think about it!
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EPCOT 30 YEAR ANNIVERSARY CELEBRATION!
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Join us on the evening of Saturday, September 29th 2912 in the Norway Pavilion Special Events Lounge in EPCOT’s World Showcase for this one of a kind event!
Your ticket includes:
- Admission into the live taping of CW in the Norway Pavilion of EPCOT (note: admission into the park is NOT included)!
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by Jeff Heimbuch
If you have a tip, questions, comments, or gripes, please feel free email me at [email protected] or leave a comment below. I’d love to hear from you!
You can read past columns of The 626 by clicking here!
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August 5, 2012 at 1:10 am
Yeah idk why anyone is suprised by this in the slightest… RFID is a very powerful tool and Disney is set to put it to work for them. And guess what! Disney, apple, Samsung, google, ect all use much more invasive technologies to get info about their customers so the limited RFID should not scare anyone.
August 5, 2012 at 3:40 am
[...] MiceChat [...]
August 5, 2012 at 3:58 am
Just another reason for me to stay away from Orlando.
August 5, 2012 at 7:21 am
I enjoyed you article, it’s an interesting point. But I really think you need to look at it from a cost perspective…not a gross revenue perspective.
Look if Disney believes RFID is the solution, then it’s a good way to stop the system, but I believe that also means that Disney believes that the chips are costing them less than a buck a chip…because wholesale soda cost for a company like disney must be something around .25/.50 at most per cup…
If you’ve been on cruise ships I believe this has been implemented as well, but the system only checks yes/no and not dates, etc. on the cups…
August 6, 2012 at 6:19 am
.25/.50 a cup is a very generous estimate. I’ve worked in restaurant purchasing, and soft drinks are one of the highest-margin items in the business. It costs a restaurant pennies a glass; it’s almost pure profit. Restaurants will accept a nearly invisibla margin on other items because they know they’ll make it back on the soft drinks.
If they think they’ll make more monsy by confusing their customers and making even the good ones feel like criminals, more power to them.
August 5, 2012 at 8:27 am
Everybody who plays by the rules won’t notice anything different. Just like when people were using wheelchairs to go to the front of the line, something had to be done.
August 5, 2012 at 11:46 am
Exactly. The only effect this will have on the ethical Guests is that they have to absorb the cost of the RFID system. Before this system is installed, the ethical Guests were litterally paying the price for all the cheaters through the continued and rapid price increases of the mug each visit. The cheaters never incurred this cost increase because they continued to use their mugs from 1998.
At least with this new system, ALL Guests will share the cost of paying for the RFID system. And hopefully with the reduction of the abuse, future price increases will be smaller and less frequent.
August 5, 2012 at 9:35 am
i love it i hope they bring it to california
August 6, 2012 at 2:48 pm
No.
Timekeeper
August 8, 2012 at 1:24 am
Of course they will – if they haven’t already.
August 5, 2012 at 10:33 am
I actually believe the chip is a good thing, I have my refillable mugs from all my trips because I played by the rules and bought a NEW mug each time. It was so aggravating to see all the people with old mugs breaking the honor rules, thinking I am paying higher costs somewhere because Disney is not taking this $$ loss, but passing is on somehow. A rule is a rule and all should honor the rules and so now Disney has decided to make people follow one simple rule. I am sure some will figure a way around this as well, in the meantime, I am glad. I am sure I am in the minority here.
August 5, 2012 at 11:40 am
Don’t know if you are in the minority, but I am glad to see there are people that are ethical and not shy to state it. Thank you!
August 8, 2012 at 1:25 am
Like.
August 5, 2012 at 10:34 am
The big brother aspects of Disney using RFID to track everything you do at the parks is chilling. It might make sense for them to plan out your day for you and track your location and spending, but should they? Will the public freak out like they do when Google and Facebook overreach?
August 5, 2012 at 11:56 am
Separate from the ethical issue of abusing the refill system, Dusty brings up a very interesting privacy issue. When does tracking of Guests movement and behaviors become an invasion of privacy?
During this past holiday season, there were several retailers that had plans to track their customer’s movement and actions through their store using cellular technology. After it got leaked that this was going to take place, public outcry and pressure caused the retailers to reverse their decision to track their customers.
Is there really any Guest actions in the parks that can be tracked that could be considered an invasion of one’s privacy? This is the key and most debateable question.
August 5, 2012 at 7:38 pm
Either DIsney uses some sort of tracking method to keep the people who cheat the honor system from doing so, or honest people (such as myself) can continue paying for their (the cheaters’) drinks through increased prices. How in the world does that translate to “big brother aspects”? “Chilling”? Not in the least.
August 6, 2012 at 12:45 am
Dusty is obviously talking about more than just beverage refill enforcement. He’s referring to Disney being able to track everything you do on property, including ostensibly your current location, using XPass. If Disney does indeed use XPass that way, it will be a little “chilling.”
August 5, 2012 at 10:43 am
To bad Disney gets the syrup for the pop for free. One of the reasons why they give QSFB cast members free soda is because the don’t pay for it.
August 5, 2012 at 10:54 am
In December 2000, while looking at the refillable mugs at Disney’s All Star Movies, a cast member pointed out to me that as long as I owned the mug I could bring it back to Disney’s All Star Movies for free refills. The cashier followed with the same advise. Apparently Disney has changed their sales pitch and the rules of the refillable mug program. I haven’t stayed at the ASM since and haven’t attempted a refill.
August 5, 2012 at 10:58 am
I am really excited to see what they will do with RFID in terms of ride personalization. This entire next gen project fascinates me. I wrote about some RFID http://www.tikispaceshipearth.com/2011/11/nextgen-rfid-it-begins/ here. Are they doing all this work with the cups in order to practice? Cause that project is just silly.
August 5, 2012 at 11:04 am
[...] **Update! Check out this cool RFID post from Micechat.** [...]
August 5, 2012 at 11:36 am
Nice article. The numbers and estimates are debateable and very subjective. But the fact that the system is being abused by Guests is undeniable. And if the financial impact of the abuse were truly negligable, as the abusers love to use as justification, Disney would not be investing in such a costly system to combat the situation.
Too bad Disney has to take such measures just to stop the unethical behaviors of some of their Guests. Seeing so many people abuse the refillable mug system over the years really irked and saddened me. It really is a reflection of the moral decay of today’s society.
Those that scoff at my comments just help to validate my point.
August 5, 2012 at 1:08 pm
Great article, thank you! I agree with Xtine and believe that while abusing drinks happens, RFID on drink cups is the perfect testing ground (high volume, low risk) for Disney to work the kinks out. What’s the fallout if something goes arwy with this system? “I want my drink and I want it now!” A Cast member will override the system and you’ll get your drink, all the while, Disney can figure out exactly how to maximize the data collected and minimize the pitfalls. One must remember that RFID is a two way street to help Disney track product and peeps AND to help customize and augment the guest experience. Disney will not maximize RFID technology by using it soley for inventory control.
August 5, 2012 at 1:29 pm
Jeff, I like your articles, and I’ve been reading these for a long time, but this time you really lost the ball… your article shows you haven’t done enough research recently to have any clue what is going on. So, let me update you… Yes, Disney tested ValidFill. Guests ended up hating ValidFill, and Disney also decided that the entire system would be a complete waste of time and money to implement. Let me explain:
There are NO PLANS AT ALL to implement the ValidFill System at any future Disney locations. The test was a failure. Why? Guests had a hard time using the system, the system doesn’t make sense from a cost standpoint, and it created tons of other problems that were unforeseen previously. (Like guests moving to multiple resorts during their stay) The ValidFill system is not effective.
So, what is being done? Well, there is much simpler solution that Disney decided on:
All Disney Dining Plans now come with refillable mugs. Now, if you stay at Disney and use the Dining plan, you’re buying new mugs every visit no matter what, even if you have them from last time. Want to use your old mug? No problem, but you just bought a new one anyway as part of the cost of the Dining Plan, so you’re paying for the refills anyway.
That’s the actual solution, not the (really crappy) ValidFill system.
Now, yes, the RFIDs are coming to the parks and your hotels. That’s true… but not in refillable mugs. They’ll be in your wristbands / room keys. Use it for park admission, door locks, purchases, etc. But mugs? That’s not going to happen.
Also, no RFID is used with PhotoPass at all… not saying it won’t in the future, but that doesn’t exist yet. Perhaps you missed the red laser scanning the SQUARE BARCODE on your PhotoPass. RFIDs Don’t use lasers. (Except in the manufacturing process)
Sorry I had to correct most of the things you’ve said this week, but I need to be sure the CORRECT information is out there.
August 5, 2012 at 11:45 pm
I agree with Bill.
The errors and omissions in this article make me question its entire accuracy.
First of all, Disney Photo Pass does NOT use RFID.
Next, the financial loss breakdown is totally fabricated. All the figures are speculative with nothing but a lot of guesswork. “Let’s say 25% of X visitors buy the mug, let’s say X% keep bringing back their mug without paying.” You grant Disney $3 per refill as a “Loss.” Yes, they may be losing what they WANT to collect but their REAL loss is water and few cent worth of syrup, if they even pay for that! It’s been discussed many times that the syrup is given to Disney free of charge for promotional consideration.
Bottom line, your assertion that Disney is losing $136.5 Million has NO basis in reality.
Should guests cheat the system? NO! We just returned from a 10-day vacation, in which we ALL had the dining plan and were given a mug ad played by the rules. Just looked at it… NOPE, no chip.
And by the way, Disney never met a price hike it didn’t LOVE! Suggesting that this would lessen the frequency or level of their never-ending increases is pure poppycock!
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