Distribute: Masabi – turning user insights into scale
Articles,  Blog

Distribute: Masabi – turning user insights into scale

agencies across the world. So what I’m going to
talk to you about today is how we’ve gathered
customer insight and data to build business cases and to
subsequently grow our company. This might be a little
different to some of the other presentations
insofar as some of the data that we’ve been collecting
isn’t just from analytics but is from social behavior
and beyond, really. So a little bit
of flash history. We started writing
mobile apps back in 2002 when phones looked like that. That was off the
back of the promise that this was very imminently
going to become a huge channel. Of course, that didn’t
really materialize for quite a number of years,
which meant for the first years we were really quite
basically poor, I guess. But it did give us a
lot of time to think about the sort of reach
that mobile apps could deliver once the
market was ready. And it was an opportunity really
to think about doing something really exciting, something
really interesting, that could touch the lives of
so many different people in one go– through one medium. So how do we leverage
that kind of volume? So what kind of insight,
what kind of goals did we set ourselves
at that time. So I guess there’s no real
answer to how you leverage large volumes in a
commercially viable way. But we set ourselves
a few rules. A few ideas. We thought that the apps
had to be really compelling. And in order to be
really compelling, they had to be free and
available for everyone. We thought that in order
to leverage the scale to its maximum, we would
have to have a model that was transactional to generate
the recurring revenue. And we wanted to focus
on those environments where mobile could become the
ubiquitous way of doing things. So how do we make it happen? So our ethos has
been really to focus on trying to solve
real world problems. Trying to build business
cases around solving pain points that people go
through every single day. Sort of trying to focus
more on what people need rather than what they want. So we started focusing
on the transit agency because of the very
large– I’ve disappeared. FEMALE SPEAKER: You focus
on the transit agencies. GIACOMMO BIGGIERO: So I
focused on the– we focused on the transits agencies–
transit industry– because the volumes
were so large and because the customer
experience is really quite clunky. And basically it’s
ripe for innovation. So the first thing we looked
at was the airline industry, which was the first mover to
move to digital ticketing. And that completely disrupted
travel agencies, et cetera. And everybody started
buying their tickets online. And I guess it’s interesting
because with airline, people have quite a big
financial commitment when they buy a ticket. They’re sort of planning
things in advance with their friends or
family at destination. That takes some time. Plus the tickets
are yield managed, which means the
further in advance you buy the ticket, the
cheaper it’s going to be. So the likelihood, really, is
that users are going to be– or prospective
ticket buyers– are going to be buying these tickets
at home, sat at their table, on a website, way before
they’re going to travel. So we looked at other
areas of transit where mobile could
be more effective. And that’s when we
started to investigate the data around railway and bus. Railway was
particularly interesting because everyone was buying
tickets at the station. This wasn’t for any kind of
lack of websites or ability to buy tickets in advance. That’s just what
people were doing. They were just walking up at
the stations and buying tickets. They were craving for a
last minute experience. Perhaps, it’s because it’s a
smaller financial commitment, they’re going somewhere
for the weekend, they’re seeing their
folks, whatever. It’s a much simpler kind of
experience that they’re after. So in the UK we saw
that 70% of tickets were bought at the station. But this experience is quite
a painful one in practice. So for those of you that
have lived in the UK, in London, or in any large
city for that matter, you’ll see that
congestion and ticket queues are really,
really painful. And that’s only really
going to get worse off the back of urbanization,
population growth. We’re only going to see more
and more people rocking up at stations trying
to buy tickets. And the government’s
very keen to make sure the congestion
in the stations is limited and mitigated
as much as possible. And the transit
agencies obviously need to bear the cost of
all those ticket vending machines and all that
equipment, maintenance, and overhead associated with
cash handling, et cetera. So we gathered a lot
of data and looked at how this market was working. And there was quite a
big pain point here. Not just for the consumer that
wanted something last minute, on the go and
instead have to queue up in this horrible
experience, but also for the operator that was
spending a lot of money in trying to sell these
tickets and giving up a lot of valuable retail
space such as this image shows in Gatwick Airport which
could be filled with shops or a pub which is going
to generate revenue for the operator and is going
to be a much more exciting user experience, I think,
than queuing up. So with that insight from the
user– from the passenger– kind of data that we
gathered and the insight from the operators’
commercial drivers, we came up with the
idea of transforming the phone into the
ticket vending machine and transforming the phone
into the ticket itself. That way we could deliver
some of that last minute, on the go user experience that
the passengers are looking for and that marries itself
so well with mobile, and at the same time drive down
the costs for the agencies that are trying to sell
these tickets. So that way we saw not only the
adoption from the user’s case, but also an industry
that’s willing to back this new technology. So that means no
ticket queues, no more need to scale your ticket
vending machines as previously planned. If you have a new channel
you can sell tickets through, it doesn’t cost you
anything as an operator because you as a consumer
are bringing your own ticket vending machine. And in this picture
alone we can see about a quarter of
a million dollars worth of ticket vending machine. And if we think that that
can service about four to five people at
once, how much does it cost to service
100 people that have got mobile
phones– nothing. So the drivers there
are really obvious and the operator can replace
these ticket vending machines with any other
retailing activity that would actually generate
direct revenue for them. So we did a lot of research
around the technology of ticket vending machines and
what we were working with to understand what
the price points were to enable us to come up with
a commercial model that would allow us to leverage the huge
volumes that mobile brings. And cash handling
turns out to be an extremely expensive affair. And a lot of transit
agencies such as Transport For London are actually
getting rid of cash altogether, replacing it with
contactless EMV or Oyster card or other technologies. So mobile is an
ideal channel for us to look at to exploit that
volume because you are taking all the boxes for the operator
as well as the passenger. So that was kind of what we
built our initial business case off of. But I guess gathering
insight, executing on it, growing off the back of
that is a continuous process that we are going
through as a business. And it’s something that you
have to go through continuously if you want to continue to
grow and fulfill your business model. So once that business
model is in place there are still more
things to learn. There’s still more
data to gather. And there’s still more things
to action off the back of that. So we developed our
own analytics package that leverages some of
the existing tools, Google Analytics, and a lot of
other things out there and aggregates them together to
display something which really gives us a lot of information
about passenger transit. How are they using
those tickets? How are they traveling? When are they traveling? When are they buying? How can we start designing our
new features or our new updates to really maximize
the user experience? So there’s a lot of work
that’s gone into that. But perhaps the most
interesting part has really been
gathering the insight from the industry itself. So in the UK, for
example, there’s a highly fragmented rail market. There’s a lot of
private operators. And in order for mobile to be
the ubiquitous way of buying tickets, we need to make sure
that those tickets are accepted and validated by all the
operators in the market. So some operators might
accept it and others might not because they need to
be validated in a specific way. So in order to
accelerate our growth, we kind of collected
all the information and established relationships
with the operators and decided to develop
another suite of mobile apps that conductors could use
to validate those tickets. So the conductor would
come along with their app and exploiting the onboard
camera on the device, take a picture of the bar
code or read the NFC tag and validate the
ticket that way. Again, without the
need for the operator to invest in further
infrastructure to enable mobile ticketing. So it’s again, leveraging
existing hardware. Users bring their own hardware. Conductors bring
their own hardware. There’s no additional
investment. And that way we can
accelerate the adoption of mobile ticketing. And what we learned from that
was that adoption is growing but not at the pace
that we wanted to. So we started looking at a
new model for our business. We started looking
at other environments where there was only
a single operator. So there wasn’t this
need for interoperation. So people could have a
very simple proposition– mobile ticketing
wherever you travel. You don’t have to specifically
go on one operator or another to use it. And so we developed
our JustRide product, which is not only applicable
to large transit areas but also can work across
different modes of transit. So this is a product
now we’ve launched in markets outside the UK. It’s live in Boston,
in San Diego. It also works in
non-rail environments. We recently landed a
contract with Thames Clippers to do the boats on
the Thames as well. So learning from that
experience in the UK has really allowed us to
design a product that’s much more flexible. So currently we have 18 agencies
and clients across the world. We currently service about 65%
of the UK market by operator. We have quite a few millions
of downloads and lots and lots of requests
for per minute. And it’s been really quite
exciting journey from us. And as of yesterday, we are
very excited to announce that we landed a contract
to do mobile ticketing for the Metropolitan Transit
Authority in New York. So that’s a really exciting
turning point for us. So, yeah. That’s kind of Masabi’s
journey and how we’ve use the insight
of how an industry works and how passenger behavior
is to leverage the scale that mobile ticketing
can deliver. Thank you. [APPLAUSE] GIACOMMO BIGGIERO: Wow. That was really quick. FEMALE SPEAKER: So
now we’ll have que–

One Comment

  • Shawn Thuris

    Never knew ticket machines involved such big costs. Congratulations on staying with the ticketing idea through generations of technology and actually making the idea work.

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