First, I didn't even think Larian would hit the million mark to begin with. Also I figured it be cut out as they would have 2x as much NPC text as they do now to program for this to work.
Some benefits:
Don't have to wait for day to come around to buy and sell at a shop.
Don't have to wait for night to hit up the black market...
Don't have to wait around for a specific hour for an NPC to show up.
I personally find the game complex enough, honestly I'm glad day/night got axed.
10% of that million dollars went to kickstarter fees. And 900K get spent pretty darn quickly when you got a building to run, utility bills, employees to pay, software licensing fees (huge chunk invested), and services we take for granted like these forums and the Larian Vault in operation.
If Larian made about 5mil in that campaign, then I can see it do-able for them to get the staff they need to implement this. For a video game development budget, 900k is not that much money.
Skyrim development:
$85 Million
90 employees
83 Voice actors
3.5 years development.
I can easily see how a Million seems like a lot, but in the corporate world it isn't

Larian made A LOT of changes with only $900k extra in their pockets. I know my kickstarter money was put to good use

Source:
http://www.statisticbrain.com/skyrim-the-elder-scrolls-v-statistics/