V.
Digital Program Guide
A Comprehensive Mobile App
for Events and Theme Parks
Executive Summary
Problem Overview
In the most recent attempt to create a
mobile application for the large-scale
music festival Coachella, the outcome was
a tremendous failure. Despite possessing
many useful features such as friend
finders and parking markers, the
application suffered from signal overloads
and inaccurate GPS coordinates,
undermining the potential convenience
that it could have provided for festival
attendees.1 In contrast to these
competitors, Eureka is seeking to create a
foolproof and stress-free tool that will
enhance the festival and theme park
experience in a useful and reliable way.
Through the marriage of social media,
mobile payment processing, and location-
based services, Eureka brings the entire
social experience of an event or theme
park to your phone in a comprehensive
mobile application.
Product Overview
Eureka is a mobile application and
interactive map that can be downloaded
prior to an event, free of charge. Key to its
success, Eureka taps into many ideas that
have recently become popular in mobile
application development, e.g. cabsharing.
However, we wield a crucial advantage:
these tools manifest efficiently only in
public spaces. In other words, they are
viable only in the context of a large crowd
that is in a fixed location. Among these
features, Eureka will include the following:
I. Friend Finder (Core feature)
Using GPS and ground-based
augmentation devices, the Friend
Finder will provide the highest
level of accuracy of any mobile
positioning application. Structured
with a user-friendly interface, the
feature allows event goers to
rendezvous with their friends as
they follow an arrow on their
phone screen.
1 2
Source: SF Weekly, Blogs. 17 April 2010.
II. Mobile Payment Processing
Eureka will feature a mobile payment
application to buy food and merchandise
from vendors via an interactive festival
map. That is, one simply has to tap the
icon of a nearby vendor and select the
item they wish to purchase. This allows
patrons to beat long lines and easily
execute transactions without the
inconvenience of cash and exorbitant ATM
fees.
III. Location-Based Microblogging
With the recent growth of social media, a
space has been created for interactive
communication among event-goers. In
order to address this opportunity, our
mobile application will integrate with
Facebook in order to map friends and
members of mutual networks (e.g.
Universities). This allows event-goers to
seize a multitude of untapped social
opportunities that can vastly improve the
experience. For instance, users can discuss
performances, rendezvous with other
attendees, and arrange ride-sharing, etc.
IV. Parking Payment and Location Marker
With the tens of thousands of patrons at
large festivals and theme parks, parking
can be an arduous task that can easily
improve with Eureka’s software. Similar
to the mobile payment offering, one can
pay their parking fees directly through
their phone without waiting in line for the
parking attendant and without needing
cash on hand. Moreover, one can mark
their parking spot on the GPS-enabled
map, allowing the available parking spots
to be catalogued for the benefit of other
patrons seeking parking themselves. In
addition, it allows for easy reference and
location later on, preventing the frequent
mishap of losing one’s vehicle.
Printed programs are commonly lost and
damaged in the context of live events.
This—in addition to the paper waste—can
be addressed with an integrated
information channel for performance
schedules, event mapping, and artist
information. The digital aspect allows
information to be organized in a
presentable way, without sacrificing
specific information.
VI. In-network Voice and Text Support
One of the most frequently cited
complaints at crowded festivals is the lack
of mobile phone reception due to network
congestion and the remoteness of the
festival’s location. However, with a
medium-sized WiFi network installed
alongside the GPS transmitters, the
application will feature an in-network
calling and texting option, eliminating the
need for cell phone reception—which has
historically been unreliable.2
VII. Cab-sharing
Although a multitude of cab-sharing
mobile applications already exist, they all
suffer from the complexity associated with
matching the various departure times and
locations of each user. However, for a
festival oriented application, all parties
share the same departure location—and
often the same departure time (i.e., the
end of the final show or the closing of a
theme park). As such, the only variable left
to be determined is the destination, which
Eureka can easily coordinate.
Revenue Model
As a location-based social service, Eureka
attracts people’s time and attention,
thereby creating several strong revenue
possibilities. Among these options, we
intend to utilize the following:
I. Commissions from Food, Merchandise,
Parking, and Cab Fares
Since Eureka will function as mobile
payment software for food, merchandise,
etc., each transaction would incur a small
1% commission in addition to the fees
associated with credit card processing.
II. Corporate Sponsorship and Advertising
In addition to per-unit commissions,
Eureka will also garner revenue from
corporate sponsors who wish to have
their booth featured on the application’s
Source: SF Weekly, Blogs. 17 April 2010.
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map. The app will have an interactive icon,
which allows attendees to see the
sponsors’ offerings and amenities (e.g.
free product samples, cell-phone charging,
areas to relax, etc.).
Market Size
The various industries involved in
festivals make it difficult to quantify the
market size. However, we have estimated
our markets will include the following,
based on 2010 industry data and our
revenue model: (1) approximately
$33.6MM from food and merchandise
sales at live events,3 (2) $52MM from food
and merchandise sales at theme parks,4
and (3) $27.3MM from corporate
sponsorship/advertising,5 summing up to
a total of $112.9MM.
Adoption Strategy
Eureka’s market adoption strategy will be
two pronged. First, we intend to harness
web traffic from the event’s websites. A
link will be featured which will direct
ticket-buyers to the mobile application
store of their choosing (e.g., the iTunes
Store). This method has proven to be
effective as illustrated by the 30,000
downloads for the Coachella App (of the
200,000 attendees). Second, given the
social nature of the app’s features, the
user will benefit from their friends
downloading the app themselves. As such,
we anticipate a “viral” effect, thereby
promoting even further adoption. In terms
of demographics, the targeted user will
likely be an 18-30 year old smartphone
user, as indicated by mobile phone and
live event industry data (Source: IBIS
World).
Financial Projections
Revenue
Initially we estimate operating losses due
to the low adoption. However, assuming
3
This was derived from calculating 1% commission from
a $3.36B industry. Source: IBIS World
4
While we were not able to determine the size of the
food and merchandising industry at theme parks, we
inferred from Disney Park’s income statement that half
of theme park revenue is composed of these types of
sales. Sources: IBIS World, Disney Annual Report
5
According to the size of the corporate sponsorship
revenue steam for live events, we extrapolated that we
can earn approximately 1% of this yield, given the
average number of impressions we expect. That is, we
expect approximately 1/3 of attendants to download
the application, judging from the number of downloads
observed with the Coachella App. Source: IBIS World,
Dave Bullock (Coachella App Developer)
increasing product adoption and positive equity. Additionally, we can expect GPS
growth in both the live event and mobile and other capital equipment to cost
phone industries (IBIS World 2010), we approximately $5000 per year with a
can expect significant gains in the long $5000 allowance for incidental expenses. 6
run. In order to determine our revenue Finally, we expect our total cost to double
figures, we assumed that our clients would each year as we acquire more clients and
be primarily live events for at least the scale the business.
initial years. Then, we used estimates on
consumer spending based on data from Our Objective
IBIS World and from the Coachella Music In order to effectively fund Eureka, we are
Festival. According to IBIS World, seeking $200,000 in start-up financing,
customers spend 75% of their live event preferably from an angel investor. In
budget on tickets and 25% on food and return for this single round of financing,
merchandise. Coachella tickets in 2010 we will relinquish a 15% equity share in
were $300. Thus on average, we deduced Eureka.
customers would spend $100 on food and
merchandise at Coachella and other Team Background
similarly sized live events. We expect that Nikita Bier, UC Berkeley
with macroeconomic factors such as the As a student of the Bay Area’s renowned
recovery of the US economy, the average Haas School of Business, Nikita has been
dollars spent on food and merchandise entrenched in the cult of
will continue to increase. Furthermore, we entrepreneurship. Although much of his
multiplied this figure by the number of experience is academic, he has held
downloads per large scale festival (30,000 advisory roles in previous startups. In
according to Dave Bullock, the Coachella addition, he has a strong technical and
App Developer) and we also accounted for quantitative background in social media
a small decreases for each additional and economics, respectively.
festival client—given the tech-savvy
nature of Coachella attendees. Finally, we Gordon Glogau, UC Berkeley
multiplied the value by the 1% A double major in Political Science and
commission that we take from each Economics at UC Berkeley, Gordon has had
transaction. work experience in financial modeling and
he has a strong academic framework in
Expenses evaluating economic factors which affect
According to the founder of the social business decisions.
media startup 500Friends, we can expect
to incur around $50,000 per programmer
in development expenses. However, this
would also require us to relinquish some
$800,000.00
$700,000.00
$600,000.00
$500,000.00
$400,000.00
$300,000.00 Revenue
$200,000.00 Expenses
$100,000.00
$0.00
1 2 3 4 5
Revenue $30,000 $82,400 $176,80 $336,00 $742,00
Expenses $60,000 $120,00 $180,00 $240,00 $300,00
Year 1 2 3 4 5
Event Clients 1 3 7 15 30
Total Downloads 30000 80000 170000 320000 700000
Average Spent Per Customer $100.00 $103.00 $104.00 $105.00 $106.00
Revenue $30,000.00 $82,400.00 $176,800.00 $336,000.00 $742,000.00
Expenses $60,000.00 $120,000.00 $180,000.00 $240,000.00 $300,000.00
Operating Income ($30,000.00) ($37,600.00) ($3,200.00) $96,000.00 $442,000.00
6
Source: “GPS Beacon Receivers.” Trimble Online Store.
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