Mils Interdisciplinary Project Study at TUM
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Mils Project Study
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In an interdisciplinary project study at TUM Ferdinand Ehrhardt and I were challenged to investigate the process of launching an app. Prior to working on Mils Ferdinand and I carried out work on our idea Train Claim, a smartphone app that facilitates the process of claiming refunds in the case of train delays. The idea was based on the EU Directive on Passengers Rights that obliges railway companies to refund certain amounts of the ticket price in the case of delays. Although we liked the idea a lot we dumped it for the reasons outlined in the presentation. While working on Train Claim we discovered the necessity for an easy to use, pay-as-you go snail mail app that allows you to add your handwritten signature to your letters. That's exactly what Mils is. Have fun with the presentation. As always, feedback is appreciated ;)
Transcript of Mils Interdisciplinary Project Study at TUM
Mils Project Study
Agenda
Initial Idea Train Claim
Planning Mils
Implementing Mils
Taking Mils to the Next Level
Agenda
Initial Idea Train Claim
Planning Mils
Implementing Mils
Taking Mils to the Next Level
Claim Refunds via Smartphone Initial Idea Train Claim
Idea Based on EU Directive Intelligent, Quick & Easy Process Take a Picture of the Ticket as Proof of Delay Sign via Touchscreen Submit & get the Refund Payment via In-App Purchase
Claim Refunds via Smartphone Initial Idea Train Claim
Idea Based on EU Directive Intelligent, Quick & Easy Process Take a Picture of the Ticket as Proof of Delay Sign via Touchscreen Submit & get the Refund Payment via In-App Purchase
Claim Refunds via Smartphone Initial Idea Train Claim
Idea Based on EU Directive Intelligent, Quick & Easy Process Take a Picture of the Ticket as Proof of Delay Sign via Touchscreen Submit & get the Refund Payment via In-App Purchase
Market: Who and Why? Initial Idea Train Claim
Target Group USP Frequent Train Travellers Dissatisfied DB Customers Digital Natives Smartphone Users
User-Friendly On the Way & Fast Only Smartphone Required
Competitors Refund.me Traditional Refund System Flightright
Unrealized Turnover
Turnover
Potential Initial Idea Train Claim
Total Market vs. Maximum Turnover
High Implementation Cost Limit Turnover and Margins
0.90 €
0.33 €
0.63 €
0.23 €
- €
0.50 €
1.00 €
1.50 €
2.00 €
Profit per Claim
In-App Purchase
Postage
Cost Structure
Why did we Bail? Initial Idea Train Claim
Validity of Touchscreen Signature Quagmire: High Dependence on Deutsche Bahn Terms Photos of Tickets Might be Illegible and Therefore Void
Only Postal Service Accepted Third Party Liability Issues European Rollout Hardly Possible
Legal Issues
General Issues
Bad Ratings Demands for Refund Cost for Non-Refundable Claims This Results in a High Financial Risk
Risks
Agenda
Initial Idea: Train Claim
Planning Mils
Implementing Mils Taking Mils to the Next Level
Market: Competitive Landscape Planning Mils
Medium Cost Difficult to Find the Right Partner for Individual Destination User Unfriendly Interfaces Time Consuming
Low Cost Time Consuming Equipment Necessary
Exclusively Domestic „Postident“ Required
Distribution Partners Traditional Postal Services
E-Post (Germany)
Market: Who and Why? Planning Mils
Target Group USP
Digital Natives Expatriates Globally Connected Tech-Savvy Medium to High Income
User-Friendly Integrated Signature Possible Worldwide Distribution Fast Delivery Available on Mac OSX & Windows
1.00 € 2.00 € 3.00 € 4.00 €
IAP
Legal & Feasibility: Payment Planning Mils
„Economies of Price“ VAT Applies Common Means of Payment
Efficient at Lower Price end VAT Does not Apply Feasibility Issues Only Fixed Prices Possible
CREDIT
Price IAPPrice Credit Card
Credit Card
In-App Purchase
Legal & Feasibility: VAT Planning Mils
EU Non-EU
Consumer
Business
Germany 19% VAT 19% VAT 0% VAT
VAT Refundable 0% VAT if VAT-ID Provided & Valid 19% VAT Otherwise
0% VAT
Higher Margin with Non-EU Customers
Forecast Planning Mils
Download Curve Similiar to Track My Life Based on Platform User Numbers Active User Rate Similiar Between Utility Apps Experience Based Scenarios
Optimistic Realisitc Pessimistic
Model Assumptions Realistic Case
0
5000
10000
15000
20000
25000
0
50000
100000
150000
200000
250000
300000
Total Monthly Downloads Total Cumulative Downloads
Financial Model Planning Mils
Based on Forecast Surveyed Spending Behaviour Included Two Extreme Cases:
Case 1: Germans Send a Letter to a German Recipient (Unfavourable) Case 2: People Outside of the USA Send a Letter to the USA (Favourable)
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
0.9 € 1.5 € 2.1 € 2.7 €
Case 1
Case 2
Spending Behaviour Compared Assumptions
Financial Model Planning Mils
Costs Based on Cases
VAT & Credit Card Costs Included
Optimum Margin at 0.35 € Forecasts of Monthly Returns
Assumptions
Results
Average Monthly Returns
383 €
1100 €
2489 €
0 € 200 € 400 € 600 € 800 €
1000 € 1200 € 1400 € 1600 € 1800 € 2000 € 2200 € 2400 € 2600 € 2800 €
Pessimistic Base Optimistic
Agenda
Initial Idea: Train Claim
Planning Mils
Implementing Mils
Taking Mils to the Next Level
Spain Portugal Germany UK France Czech Republic
Partnering: Distribution Network Implementing Mils
Europe
Marketing Implementing Mils
Own Webpage Blog Features Articles on Webpages Joint Press Releases Contributions to Competitions Open Source References
Guerrilla Marketing Video Ideally Viral Spread Pitches to Tech Journalists
App Store Features High Ratings Download Rankings Cross-App Advertising
Multi-Language Support Implementing Mils
Portuguese: 3.08%
Italian: 0.90%
German: 1.39%
French: 1.12%
English: 5.52%
Spanish: 5.85% Benefits Increased Customer Base Enhanced Trustworthiness Substantially Elevated Community Recognition and Augmented App Store Featuring Probability
17.86% Native Language Coverage
Drawbacks Time and Cost Intensive Increasing Complexity for Updates
Economic Review Implementing Mils
Pessimistic IRR: - 37.08%
Base IRR: +10.93%
Optimistic IRR: +77.14%
2 Year IRR Scenarios
Agenda
Initial Idea: Train Claim
Planning Mils
Implementing Mils
Taking Mils to the Next Level
Future Developments Taking Mils to the Next Level
Easy Implementation for Mass Mailings Include Discount for Key Customers Premium Services (i.e. Customized Envelopes) Economies of Scale
Smartphone Expansion Extend Distribution Network Verticals: Offer Other Print Products
B2B B2C
Lessons Learned Taking Mils to the Next Level
Train Claim Mils
The More Complex the Service, the Higher the Chance of Legal Problems Cost Structure Matters Big Time High Risk Requires High Return
Consumers are very cost sensitive When Depending on Partners Planning Thoroughly is Crucial Prepare for Eventualities, Especially When Dealing With Third Parties Don´t Mistake Launching a Product with Creating a Product
Thank You!
