Sport Innovation/ticket2mountain

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Ticket2Mountain
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Ticket2Mountain is a smartphone application that utilises Near field communication(NFC), specifically radio-frequency identification (RFID) technology. The application acts as a service, enabling users to use their smartphone as a lift pass at various mountain resorts without having to purchase an additional key card to access the lift systems. Ticket2mountain also provides a website where users can buy lift passes to various mountain resorts as well as downloading the application free of charge.

Current use of NFC in mountain resort industry

NFC and RFID technology is currently being used in mountain resort throughout the globe. Mountain resort participants who purchases lift tickets at resorts where the technology is being utilised, are required to purchase a key card where the ticket information is stored. The key cards have RFID chips embedded that communicates with gates allowing the participants access to the lifts. By utilising smartphones as a substitute for the key card, users may access the gates without a having to purchase the additional key card.

Companies using NFC in mountain resort industry

Skidata, founded in 1977 is the world’s largest provider of access control systems at mountain resorts worldwide. A subsidiary of Skidata, Skistar is the main provider of access control systems at mountain resorts in Norway, which is the primary market for Ticket2Mountain.

Customer development process

Surveys and interviews with potential customers have been the basis for the customer discovery process. The survey looked at the number of people who brings their smartphones while on the mountain, skiing or snowboarding and the manner in which they use it. The results reviled 87% of the people surveyed bring their smartphones to the mountain and keep it on them at all times. Results obtained states a clear market for Ticket2Mountain. The survey was the first activity conducted prior to any further development could be initiated. No further development would be needed if results did not indicate a market for Ticket2Mountain.

Results from survey further aided in the development of areas to discuss in interviews conducted with both potential customers and industry professionals. The interviews where firstly conducted in the form of informal conversations with customers in the Norwegian market. Close friends with experience from the mountain industry and several years of riding in mountain resorts where NFC and RFID technology is being used were the subjects. Firstly some assumptions relating to the results from the survey were addressed, specifically in what manner people use their smartphones while on the mountain. Is it always kept in the same pocket (it is necessary to keep it on one side of the body, preferably upper thigh or arm in order for NFC to be picked up), is the smartphone moved from pocket to pocket dependant on use, the necessary ease of access for users when using their smartphone for other purposes (i.e. taking photos, videos, sending texts, calling or using the internet), the fear of losing the phone when using it in conditions such as snow, rain or other various conditions and reasons why people would not consider having their smartphones on their person while on the mountain. Some interesting issues were uncovered. While people may have concerns regarding the loss or damage of their smartphones, the desire to bring it seems to override these potential initial concerns. Although not empirical data, people interviewed were not adamant about having a certain location on their person where they have to keep their phone. Interviewees stated though they usually keep their phones in one location however, this again was a need subject to flexibility should it be required in order for NFC to work.

Secondly, the interviews were steered in the direction of the value proposition and whether people would be susceptible to the service. Time saved by buying lift passes online eliminating the need to stand in ticket lines, money saved by not having to buy an additional key card as well as minimisation of the risk of potential loss of key card, although it obviously is possible to lose your phone, were all added values to the ski and snowboard experience, considered very positive. The idea of buying an application at a cost of $1 (initially free) instead of a key card at a cost of $10-15 was especially well received. Though people may lose their smartphones, the actual purchase of a “key card” through the application is something that is never lost, as all purchases are stored in the various online app stores, and can be retrieved free of charge onto any mobile device (must be on same operating system, i.e. Android, IOS, windows or BlackBerry).

Thirdly, the feasibility of the service was discussed. Areas such as technology, resources, key partners, key activities, marketing channels, advertisement & promotion, cost structure, revenue stream etc. were addressed. The technologies needed all exists and are easily accessible. Both website builders and application builders were discussed and the various approaches that can be chosen in this area. Ticket2Mountain currently uses Weebly, a free online service providing an easy to use platform for website building. The need for a public dot com domain though was something highlighted during talks with the interviewees as it gives a higher online profile. There are also various application builders available, and the discussion revolved around the different aspect each provider can deliver. A specific area of concern that will need extra attention is the ownership structure of the application and the continued maintenance. Ticket2Mountain has not yet made a final decision regarding application builder, though Shortcut, a Norwegian application builder is the current choice as they fit the current goals and objective of the venture.

Resources needed, already outlined by Ticket2Mountain include, Skidata, Skistar, mountain resorts, network in the mountain resort industry and financial. The discussions in the interviews mainly revolved around the need to create good partnerships with Skidata and the mountain resorts Ticket2Mountain wish to operate in. The importance of having a value proposition not only for the customers but also these key partners is paramount and if not developed, Ticket2Mountain will have little if no further development potential. The key activities discussed and highlighted were research and development, the production model of website and application, building relationships with key partners, marketing plan and advertisement & promotions. Again the importance of starting the process of building relationships with key partners as soon as possible in order to avoid unnecessary cost of development in other areas should the relationship building fail, was addressed. Furthermore, the creation of a marketing plan that really hits home with the demographics of Ticket2Mountain was discussed. Assumptions such as word of mouth and social media being the main channels were challenged.

With an annual purchase base of 6 million day passes sold in Norway each year, the cost structure discussion focused on value adding rather that looking at the potential downside. If Ticket2Mountain is successful in launching, revenue stream will be substantial. It was noted though, the need to keep initial costs of development to a minimum is of importance should Ticket2Mountain be unsuccessful. Furthermore, price sensitivity was discussed. Ticket2Mountain’s application will initially be free, however with a long term perspective of costing $1. Interviewees indicated a positive stance towards this approach and it was even stated that the application could be sold for more. The notion of not having to re purchase the app should the loss of smartphone occur was another factor positively acknowledged.

Business Model Canvas progress

The business model canvas has been continuously updated throughout the customer development process and all areas have changed during customer feedback process.

Key partners: Initially the business model canvas included website builders, application builders and payment systems providers. As feedback from customer development process was retrieved however, it became obvious the focus was shifted towards Skidata, Skistar and mountain resorts. As previously stated, the relationship building with these key partners is Ticket2Mountain biggest challenge.

Key activities: Key activities again initially focused on the website and application building. Similar to the key partner section the focused shifted towards relationship building. The production model was something also added towards the latter stages of the business model canvas when details about various structures and especially between different application builders were uncovered. Value proposition: The value proposition has remained unchanged throughout the business model canvas process. Although, adding other features to the application in the future was mentioned, this has not been added as a value at this point in time.

Customer relationship: Customer relationship has been an area in constant development. Where value adding was something developed early on the customer relationship took the value proposition and extended on it. The main feedback from the customer development process regarding customer relationship was the need to have an updated application and website at all times.

Customer segment: Customer segment was not something specifically addressed during the customer development process. However, the notion of providing the application to not only regular participants in the mountain resorts, but also to its employees was a feature added after initial discussions.

Key resources: Key resources has been given much focus from the early stages of development and initially included; Financial, Visa and MasterCard, Skidata and Skistar. Again, the area given the most focus has been the relationship building. Additionally, it was highlighted by some that infrastructure is an important factor in order make Ticket2Mountain a successful venture. The infrastructure is owned and operated by the resorts and is the main challenge for Ticket2Mountain. It will be unfeasible to operate in the mountain resort industry without partnering with the resorts.

Channels: Initially included word of mouth and social media. The customer feedback however added some channels to the business model canvas such as billboards and other advertisement & promotion strategies.

Cost structure: The cost structure of Ticket2Mountain has been the area last developed within the business model canvas. Although considered early on, the cost structure of website and application building was implemented at a later stage. The main costs will come from these two areas.

Revenue stream: As the application will be free at start up, the only revenue stream included at this point is lift ticket sales.

Further development of Ticket2Mountain

Initial feedback from the customer development process has yielded some good results, and has helped developed the business model canvas. Website and application building has a prominent development process underway, however the key for further development is creating essential relationships with key partners such as Skidata, Skistar and mountain resorts. Some concern has been raised due to the fact that Apple (link) did not implement NFC in their latest model, the IPhone 5. However the market looks promising as various other services are looking to use NFC (e.g. GoogleWallet(link, MasterCard(link), hotels etc). List of smartphones currently with NFC technology embedded

Although Apple did not implement NFC technology into their IPhone5, the list of NFC-enabled headsets shows other mobile phone companies that have.