The “Better-Fly” project

The issue: Airport boarding experience is a stressful experience

With increasing global businesses, traveling has become part of many executives and employees in global

companies. International tourism is growing at around 7% every year. However, travel experience has since

changed. The increase in total numbers of passengers, due to the decrease in tickets prices and faster trips; more

rigid security procedures; the increase in the number of flights and airlines efforts to gain productivity led to less

comfort. The lack of information, long lines, long connecting time and lack of comfortable or practical space to

wait increase the “opportunity cost” of traveling. These phenomena may induce stress, especially for frequent

business traveler.

Stress buttons:

Concern about missing their flights: Punctuality, can't find boarding gates, bad connecting timings,

transfer between two airports in the same city

Check-in and Customs efficiency: long queues, intense security, rude service

Bad customer service in general: at retail shops, crowded and inefficient service

Cleanliness: toilets, seats, etc.

Privacy: Nowhere to rest and relax or to work or study

Over-priced services: especially sub-standard F&B. Lounges only available to business and first-class

passengers

Other dimensions of the Airport / Boarding experience:

Wi-Fi and internet connectivity: This is one of the most important criteria - travelers have indicated their preference for airports where good Wi-Fi connectivity at no extra charges is available.

Rest and sleep: Apart from airline lounges, travelers on economy or budget prefer to have areas for rest and/or sleep at the airport (no reference to airport hotel) while waiting for their connecting/departing flight. Limiting factors include lack of facilities, comfort or security (personal belongings/hand luggage). Sleeping pods and lounges (for economy class) suggested. Privacy and safety are important points of consideration.

While Airport operators do their best to turn them into large shopping malls (see Shangi Airport in Singapore,

and work in Progress in Roissy Charles de Gaulle / Orly in Paris) to generate more revenues, they often forget the

key activity of the airport which is to enable passengers to board the plane in time. From a hardware perspective,

airports around the world are in very different levels of development. Many new technologies are available

focusing on security and airline productivity - However, they do not always focus on the comfort of the traveler.

Located in some of the largest and busiest cities in the world, some international airports are working in full

capacity, with an old infrastructure. Passengers face long lines and can only access very expensive services. The

worst airport conditions are found in many developing countries in Latin America and Africa. No seats are

available at departure waiting gates with a lack of services within and outside the airport, including

transportation. On the other hand, I can find modern and full-serviced airports mainly in Asia. In airports like

Hong Kong, Singapore, Tokyo, Seoul, passengers have access to a variety of services and products in a reasonable

price - which dramatically improved travelers’ experience. Trends are also evolving at leading airports

transformation: To create an experience that is closer to a mall and entertainment center, instead of just an

airport.

But back to first stress button (missing flight fear), leisure facilities are of “no use” if I can’t relax to enjoy them,

i.e. if I don’t have an “Airport Concierge/Assistant” acting as the time-keeper to improve my Airport Experience

while ensuring I shall not miss my flight. 40% of passengers at Dubai Airport are late (and some miss the plane)

because they are doing shopping instead of being focused on the boarding process. The concept of predictability

is key. The root cause of the stress is about the lack of accurate and real time information to manage the

“opportunity time cost” of ancillary activities/entertainment provided within the airport when the core

requirement when you go to the airport is to be on-time to get on the plane before it takes off. Hence, I foresee

many opportunities for business development in complementary goods and services within the airport industry.

In most of the airports, there is an overwhelming need of improvement and travelers have a list of complaints

and missing services, that range from lack of Wi-Fi, working space, better quality services for a fair price, resting

facilities, kids’ activities and others...

Lack of desired services and facilities:

Books, dining and shopping: Very important leisure activities at the airport. Travelers speak of good

layout, efficiency, variety as their preference. Prices should not be more expensive at the airport

than in the city area - Otherwise, experiences are perceived as "scams".

Leisure workout: Yoga, gym facilities for busy professionals/frequent travelers to unwind in

between flights,

Efficient travelers (both leisure and business travelers): Bespoke concierge service, city check-in

counters (As per Hong Kong airport)

Parents: Kids play area so that parents can run errands and shop Hygiene and cleanliness: Shower facilities

Others: Movie screenings

Given the trends observed, the main objective of this opportunity is now to improve frequent traveler

experience, by reducing stress button areas. With more access to information to help them get to know the

variety of services available, to have easier access to reasonable priced services, travelers can better enjoy or use

their time and become more satisfied with the whole experience.

As such, a mobile application platform to be rolled-out at airports to act as an “Airport Concierge/Assistant” to

improve frequent travelers’ airport experience, reducing “stress” and improving “airport experience” while

ensuring on-time boarding. This application will:

Be available free for the passenger (downloaded when connecting to Airport Wi-Fi + offered on Mobile

applications’ stores.

Connect to flight information services to provide real time flight status information.

Contain airport facilities information, shops, services and amenities.

Utilize existing indoor location technology to allow users to navigate the airport:

o Allow users to navigate to their gate turn by turn. Formulate a predicted transit time by

monitoring average transit times of other passengers.

o Alert the user when it’s time to start moving toward their departure area by combining transit

times and flight status information.

o Allow users to find desired services and navigate to desired services. Provide service

suggestions based on user behavior or preferences.

o Facilitate location sensitive couponing/commissions. This will allow a revenue stream while

allowing shops and services to pay nothing to list on the app.

Not be specific to one airport. Create one app connected to back-end services (platform) onto which

multiple airports can be onboarded. This will increase the network externalities as more customers use

the app, but should not face a take-up challenge any more than an airport specific app would do.

The competition

From a competition perspective, I have found out most big international airports have their own mobile app -

which is more of a marketing tool for their retailers and service providers. As the leading app for maps, google

has launched google indoor maps1, quoting an example of San Francisco International Airport. However, the

opportunity here is to provide value through a tailored mobile airport app addressing the pain points and stress

buttons highlighted above. According to our best understanding, there are two reputable airport navigation apps

- iFly and GateGuru in the market. They are both paid apps. To quote a New York Times report on iFly2 dated July

18, 2012: “bills itself as an all-purpose airport guide for ‘the informed traveler’. It contains an airport guide for

airports around the world — from Aalborg through Zurich — as well as flight timing data and other airline

information. Inside the United States, it even alerts you to airport status, including departure delays and closings.”

However, there are drawbacks:

● Weak navigation function: “But in terms of actually helping you navigate the warren of corridors and

concourses, you’re on your own; the map of the building is a blue blob. But you can plot your location

on the map and, using your phone’s GPS function, drop data on the map from a list of amenities, which

helps find their approximate location.”

● Lack of layover ideas: “But for “layover ideas” at Heathrow, the app is less helpful. It suggests you

“obtain pamphlets and information about Central London” at the airport’s five terminals, which isn’t

useful for planning your trip.”

● Inconsistent information across different airports: “It seems quality of information isn’t consistent. For

the airport nearest my home, iFly lacks maps for the entire second terminal.”

Value Proposition

According to Fodor’s Travel3, the list of top 10 apps for airport navigation and connection are very specific to

each of the pain points:

Flight connections: Just Landed, FlightBoard, FlightTrack, Available Lounges: LoungeBuddy,

Flight seats: SeatGuru, Trip planner: TripIt, TripAdvisor,

F&B, places of interest: Yelp, TripAdvisor, Accommodation: Hotel Tonight.

Travel from home to the airport: waze, Public Transportation applications, Uber, etc…

1

Google Indoor Maps - https://www.google.com.sg/maps/about/partners/indoormaps/

2 Kit Eaton, “Find your way through the airport maze, phone in hand”, New York Times, July 18, 2012:

http://www.nytimes.com/2012/07/19/technology/personaltech/find-your-way-through-the-airport-maze.html?_r=0

3 “Top 10 apps for navigating airports and connections, Fodor’s Travel, June 23, 2014: http://www.fodors.com/news/photos/top-10-apps-

for-navigating-airports-and-connections#!1-intro

In-door geolocalization: PoleStar4

A FastCompany article5 with an EU-sponsored initiative, identified the need for an “integrated application” which

could combine every information needed by travelers at the right time to provide a “headache-free” airport

experience. Such an idea is also identified by Seamless Air Travel6, to develop an app focusing on Info

Connectivity System (ICS) in collaboration with an Amsterdam-based consultancy, Edenspiekermann.

Value Curve description of the reference models

In terms of value curve, as stated above, there is no competition (blue ocean) because each and every competitor

focuses only on one set of attributes of the airport experience, without providing an and-to-end holistic

assistance to fully enjoy the airport experience being fearless of missing one’s plane. Basically, each and every

application will be very good in one dimension (one specific set of attributes), but absolutely inexistent in other

dimensions of the Airport experience: a kind of “Dirac impulsion-like” value curve (see below):

The value architecture

The value architecture is different depending on the application considered, but we can draw out some common

patterns:

Collect data from open-data / or private data sources: public transportation information, mapping

information, flight schedule information in real-time (real time is Key and mandatory). This step requires

partnerships in case of “private data” (including value sharing like fee paid to access data),

Centralize data / Structure Data in a human-understandable way (design application taking into account

“User Experience”) / Push data to mobile. This is the “technological part” of the value architecture. Aside

“User Experience” which should be maximized for data gathering and visualization, it is not that much

“compute intensive” as none of these applications provide “assistance” or “best bet”… only data

visualization for the traveler to make-up her/his mind (which does not alleviate the stress).

4 Polestar in-door geolocalization: http://www.polestar.eu/en/ 5 Shaunacy Ferro, “Could This One App Take The Headache Out Of International Air Travel?”, FastCompany, July 28, 2014:

http://www.fastcodesign.com/3033611/terminal-velocity/could-this-one-app-take-the-headache-out-of-international-air-travel

6 Seamless Air Travel: http://www.edenspiekermann.com/projects/info-connectivity-system

Distribute the application / Application advertising (mandatory to reach the critical mass leading to the

aggregating effect + network positive externalities) / monitor the application number of users &

recurrent use. Obviously the application should be present on “mobile application” stores, but it should

also be promoted especially on-line through co-marketing. One idea is to propose to the traveler to

download it when giving free access to Airport-Wi-Fi (meaning you have to pay a fee to the Airport and

then subsidize the Wi-Fi free access). Monitoring should be embedded within the application “business

logic” to get statistics about usage.

The Profit equation

Most of applications are “cloud based” applications. This means that leveraging the huge investments of Amazon,

Microsoft, Google in capital intensive cloud business, those companies have a “pay as you use” cash out model

and limited fixed fee (intellectual property and development costs). In the same idea, as they have no inventory,

their working capital is rather low. With a cost plus pricing strategy they can ensure a profitable growth… but the

issue is “how to generate revenue”.

Paid applications: customer pays for the application. No recurrent revenue… not efficient to reach

“critical mass” to benefit from positive network externalities,

Fremium: customer pays nothing for basic features, but pay premium for advanced features. Quite

efficient to reach “critical mass”, but as most applications are “single attribute set” application… hard

to differentiate between “basic features” and “advanced features”,

Subscription: customer pays monthly for the right to use the application. Segmentation can be done in

here with basic services, mainstream services and premium services. Skimming pricing strategy can be

chosen to maximize revenue at early stages. Perceived value must be real for customers (frequent flyers

mostly) to pay the recurrent fee.

So far, the cash generation pattern is “missing” in most models. Sometimes the “application’s costs” are

subsidized by other activities (see Google Indoor maps). Sometimes the costs (and debt + negative cash flow) are

covered by investors on a “per user” company valuation (although no business model has been found to

monetize this mass of users)… but most of the time, cash generation is a big issue due to the lack of a solid

business model for cash generation.

The Blue Ocean of BetterFly

The idea is to build onto this ecosystem a kind of information aggregator/broker to provide Artificial Intelligence

enabled (Chat bot Assistance) platform to plan your Airport experience and maximize it in its every dimensions:

From planning your trip with recommendation for clothes based on your destination and weather

forecast,

From moving from home to the airport and still be in time for boarding (despite traffic jams, etc..)

Providing you a list of activities once at the airport to enjoy your waiting time (flight connection), or to

provide the most efficient timing to speed-up your boarding process

Scheduling your moves inside the Airport based on your desires and requirements so you can relax and

enjoy Airport facilities and forget the stress of being late at the boarding gate (including real time

estimation for security procedures duration, etc…)

Providing you with information about special discount at the airport mall + couponing

Let’s explore the value proposition innovations of BetterFly:

It reduces prices for the client:

o Specific couponing based on customer’s taste to enjoy discount at “expensive” (perceived)

airport food, or enjoy duty free extra discount,

It reduces clients’ hassles:

o The promise of a headache-free airport experience, maximizing the experience of airport

facilities (mall included) while reducing stress with accurate and real-time information, artificial

intelligence powered “concierge” to suggest you what to do based on your flight schedule, the

airport offerings, and your tastes and likes (the concierge knows you),

Look for non-clients:

o In a B2B channel, “Better Fly” offers brands and businesses within the Airport to issue

“coupons” to travelers and to set-up instantaneously “discount” to boost sales. Better Fly in a

new digital channel for businesses to reach out customers,

Introduce more functionality and/or emotion:

o Betterfly provides you AI-powered recommendations as an efficient Airport Concierge to

maximize 360° your Airport experience while reducing your stress… so you can relax and enjoy

with Zen all the Airport experiences offered by modern airports,

Anticipate trends:

o Global/Local: a global platform for a localized and personalized Airport experience, based on

Artifical intelligence and big data analysis technology,

Modify the revenue stream:

o BetterFly is a freemium for the frequent traveler

Basic features are free (including “peace of mind”),

Average package is paid through subscription (giving access to targeted couponing),

Premium package comes with specific premium service package within the airport (by

pass queues, spa & massage, etc..) through subscription

o Betterfly has many customers:

Frequent flyers,

Independent shops within the Airport (couponing, advertising, recommendation…):

Betterfly will get a 25% of the coupon issued by the shop, Betterfly can be paid for

advertising (in door targeted channel), etc..

Airport operators: Betterfly can sell data… passengers move patterns in-door to

identify dynamic bottlenecks along the day, provide business insights based on sales

analysis, etc… strong partnership can be tied to complement existing offers and to

boost it with BetterFly technology.

Let’s explore the value architecture innovation of BetterFly:

It introduces a new technology:

o Artificial intelligence, big data analysis, in-door geolocalization

It modifies several step in the value chain:

o It aggregates all information, all “attribute set” to provide a unified airport experience with real

intelligence so you can maximize your experience guided by the “BetterFly airport concierge”,

It leverages strategic resources and competencies:

o Most of modern airports are designed by 3D computerized technologies, so this digitalized

mapping does exist, but is not used to its full extend, i.e. to serve in-door geolocalization

solutions,

o Most of modern airports do have Wi-Fi which can be leveraged using triangulation to provide

“In door” geolocalization. Additional technologies alike “beacons” and accelerometers within

smartphones can be used to improve accuracy.

o Public cloud providers provide Platform as a Service (PaaS) solutions to build Artifical

Intelligence powered mobile solution (Microsoft Cloud first/Mobile first strategy) making it

easier to build complex solutions without massive capital expenditure,

It associates with competitors and partners:

o One way to build BetterFly is to partner with all “single attribute solution” competitors to

aggregate their data and add BetterFly secret sauce which is its “artificial intelligence powered”

Airport Concierge,

BetterFly Value curve

BetterFLy Business Model (Canvas)

Let’s have a look to the Profit Equation of BetterFly:

● Online advertising (fremium customers) – Positive Network externalities: requires an as large as possible application installed base (possibility to couple installation with free airport Wi-Fi)

● Application subscription (monthly subscription / $0.99) (Premium business customer) - Relevancy of additional services

● Application subscription (coupon monitored revenue generation/ to be defined) (Independent Franchise) - Revenue increase experience monitored through specific couponing offered through the application / Coupling with NFC payment.

● Selling contract of business relevant data (yearly / to be defined) - (Airport Operator) - Improvement of passenger experience (surveys) which would reflect better utilization of resources and capacity

● Selling contract for targeted advertising and guidance (yearly / to be defined) - (Franchise / Brand / Airport Operator) - Increase in generated revenue monitored through couponing.

Our revenue generation is greatly enhanced by positive network externalities:

- 1st source of revenue will be “online advertizing” (click to pay).

- Assuming 5000 average daily user sessions

- With an average of 30 minutes per session

- With 0.5 Ad impression per minute

- With an Ad Network Fill Rate of 80% (conservative)

- With a Cost Per Mille of $2 (specific traveler audience)

Will generate $120 of revenue per day ($43’800/year). 1’000’000 users would generate $24’000 per day.

- 2nd source of revenues will be “Premium Users” (no advertizing, additional services)

- No advertising: $0.99

- Subscription for additional services (phase 2, phase 3): $0.99/month

- 3rd source of revenues will be the Merchants (either franchise or global operator). In major international hub,

the model tends to be a JV between a global operator and the international hub for mall operations.

- Large hubs retail revenue: ~ $400M

- Couponing revenue increase: +10% to +12% adressing 20% of sales revenues

- Couponing revenue “benefits”: ~ +$8M

- Revenue recognition for mobile application: 15% to 30%, i.e. $1.2M to $2.4M

- 4th source of revenues will be B2B contracts with AIrport operators and airliners (providing Data insights to

improve Airport operations)

- Revenue driver: number of contracts

- Fixed fee contract: $ 500k,