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Food Routes' Food Routes' Opportunity Assessment Opportunity Assessment Project Project (formerly “DISH Network”) (formerly “DISH Network”) By DISas November 2012

OAP Food Routes

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Page 1: OAP Food Routes

‘‘Food Routes' Food Routes'

Opportunity Assessment ProjectOpportunity Assessment Project

(formerly “DISH Network”)(formerly “DISH Network”)

By DISasNovember 2012

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'Food Routes' Concept:

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Do you want to eat affordable and authentic local food when you travel?

OR

Do you want to make some money sharing your favorite local recipes with travelers?

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We connect people who want to experience an authentic home-

cooked meal with hosts who want to provide one.

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How Do We Connect People? :

ByBy Providing a Web Site 'Food Routes' where customers can search for hosts by: location, reviews, meal dates, and much more

ByBy ensuring security with our Host Identity and Address Verification program

ByBy building a Community where users can blog, share their 'Food Routes' experience, or win awards in the best 'Food Routes' picture contest

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How Do We Connect People? :

ByBy enabling hosts to earn income.

ByBy supplying customers with hosts' neighborhood information, including transportation and off-the-beaten path places to see and experience near host's home

ByBy providing easy payment options

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Hosts and Guests register on the ‘Food Routes' Website (prototype link: www.dish4all.ning.com ) as

Members. Registration is Free and Easy. Once registered, member can post and book events.

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Survey and Face-To-Face Interviews

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What question were we trying to find an answer to?

Is there an interest in our Service?

Who are the customers?

What is important to our customers?

Would they be willing to spend money on the hosted meal service?

How user-friendly do customers find our prototype website?

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Our Assumptions prior to survey:

Customers split into two major segments: 'foodies' and 'budget travelers'

For budget travelers price is critical decision factor

Customer are interested in using the service when traveling internationally

The most important factor for customers is authenticity of meal

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What have we done and what did we find ? :

We conducted 15 Face-to-Face interviews and received 23 responses to the survey

Survey Link:

'Food Route' Survey

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Our Survey Basic Demographics :

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GENDER AGE

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Our Survey Basic Demographics :

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COUNTRY OF RESIDENS

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Our Survey Basic Demographics :

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HOUSEHOLD INCOME

Less then $2K – one respondent from South Africa,$5K to $9K – one out of 3 Russian respondents, Over$200K – one Indonesia and one USA,Rest normally distributed

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Selected Customer Quotes:

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I like it! I was a little confused about what to do. I did not see where I would sign up as a guest for a meal. I clicked on the Honduran meal, but there was no option to make a reservation. Maybe there could be a monthly feature at some point, of a "lucky" host or a "most popular" host, or "voted best host", etc. I loved the photos of the food. It looked fabulous!! I think it is attractive enough to interest people.

Linda, California

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Cool concept! Will definitely use the service and know quite a few people who would like to be a host. Easy to follow. Will be nice to incorporate some kind of a navigation tool to find the host. Also would want to see the rating of the host by previous guests.

Andrey, Moscow

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I would use the site when I travel to find an interesting place to dine. Need to make sure site has advanced search capabilities and also want to see previous customers reviews.

Kevin, Florida

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I would use the site for take away or delivery. It would be good to have house pictures, to see overall hygiene of the house. The site will be depending on people reviews, so I would like to find some recommendations from the owner's website. Some host that has been tried by the owner of 'Dish for all'.

Mrs. Wafa, California

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I may use it. But I am not sure if it is safe to go to someone I dont know, unless it is a well known chef or person. I recommend some celebrity chefs to be as a host for low budget meal, and the money will go to charity. Competition between top chiefs in town as a host to raise credibility of the website in the beginning. Add credibility degree it is different from reviews, like Amazon.com when they guarantee the seller.

Mrs. Sarah, New Mexico

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Would definitely use the service, but not host. Would like to try different authentic food, especially in countries where the average restaurant food can be poor. For example Egypt and much of the middle east unless you go to top notch restaurants. Would like to see a picture of the person and their home so I can assess level of hygiene and if I am comfortable with the type of person before selecting to go with them (from a security point of view). Business should provide hosts some guidelines around hygiene and information about what travellers might like (eg in certain countries, only offer tourists bottled water and no salads unless washed with boiled water). I would expect to pay the same or a bit less than a casual restaurant in the country (amount would depend on the country)

Adrianne, Sydney

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Important Findings and Survey Analysis:

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Customer Feedback Summary:

Good news – there is interest in the service, with the majority (89% based on survey data) customers expressing an interest in the offering

Criteria for success - some assumptions were not correct and face-to-face interview reveals that although there is definite interest in the service there are also lots of concerns and questions

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Significant Customer Findings:

•Customers are concerned about security and hygiene

•The company name 'Dish' and tag-line “Where dinner is always ready” was confusing to some customers.

• 'Dish' is major satellite provider

• The word “diner” in the tag-line is misleading as in some countries the main meal is lunch and tourists may be interested in this meal, or other meals

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Significant Customer Findings:

•Contrary to our original assumption lower-then-restaurant price is not the critical factor. Based on a survey data:

95% were willing to pay up to $20 for a meal per person

82% up to $30 per person

60% up to $40 per person

18% up to $50 per person

10% up to $80 per person

•Site usability is critical. For the final version of the site we need to make sure site is easy to follow.

It will be useful to provide functionality to allow Guests to request certain meals from the Host.

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Significant Customer Findings:

There is no clear 'foodie' and 'budget traveler' separation.

•In addition to the 'authentic meal experience' one of the main interests is to 'meet new people'

The interest in the service is not limited to international travel as originally assumed. Based on survey data 32% of customers are interested in a hosted home-cooked meal in their home-country.

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Business Model Changes Based on Customer Interviews and Survey:

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Business Model and Prototype Changes:

•Name changed to 'Food Routes‘ from 'Dish'

•Tag-line changed to 'Where your meal is always ready‘

•Introduced into our operating model a Host Identity and Address Verification program where the host can chose to participate by providing required documentation

•Building a 'Food Routes' community to encourage customer interaction. For example, providing blog space, running 'best picture' contests, 'Host-of-the-month' awards, celebrity chefs charity meals, etc

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Business Model and Prototype Changes:

Include in the web site/ mobile app neighborhood information, transportation information, and pictures of the host and their pictures

•Need to conduct separate survey concentrating on hosts, as building host network is critical. To be successful hosts in addition to the cooking skills need to have friendly and outgoing personality and home that is clean, secure and easily accessible for the customers.

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Market Size Analysis:

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Target Market:

• Our target market was Australians and Americans who are travelling on holidays who are foodies (segment 1) or budget travellers (segment 2)

• We identified the top 5 international destinations of Australians and Americans:

• We sourced the statistics on the number of international trips by Americans and Australians from government web sites

• We adjusted numbers to exclude:

• Business trips

• Trips where travellers were visiting friends and family (who presumably had no need to find other sources of home cooked meals

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Target Market:

•Where there was data missing we assumed Americans and Australians had similar travel profiles (business vs leisure vs visiting family and friends)

•We then assumed a % of the trips were done by foodies (20%) and budget travellers (20%), and the percentage who would be interested in the service (20%)

•We assumed on average there would be 2 people at each meal event, and each host would provide on average 12 meals per annum

•We then developed a simple revenue model for the business

Sources:

•Office of Travel and Tourism Industries, US Department of Commerce (US Residents Traveling to Overseas Destinations 2011)•Australian Bureau of Statistics (Australian Residents Departing Temporarily Internationally for Holidays)

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Market Analysis Key findings:

• The top destinations for Americans are Mexico, Canada, UK, Italy and France

• The top destinations for Australians are NZ, Indonesia, USA, Thailand and the UK

• Based on our described methodology we estimate:• The market size to be 1.3m meals per annum• The market value to be worth $7.8M to us based on our

current assumed pricing structure

Current assumed pricing structure:•Host Sign up Fee = $5•Booking Fee = 10%•Commission = 15%•Avg Meal Price = $30

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Market Analysis Key Conclusions:

• The simple revenue model highlighted the following about our business model:

• Slim margins• Volume dependent, but large scale economics• The need to have a low-cost cost structure

• We realized that we were being too conservative in limiting the market segment of travelers to only two countries (US and Australia)

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Market Analysis Key Conclusions:

• Market size is estimated at $7.8M$7.8M

• Customer surveys pointed that there is a potential for market size increase pending additional research:

• We queried whether there would be interest in local meals in countries which are very similar culturally to the customer’s home country and received positive results.

• Our Customer research also showed there could be interest in a local home cooked meal even in customers home country.

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Market Size Key Actions:

•As a result of our market analysis we decided to expand the market opportunity to include travelers from Western Europe who are also travelling to our top destinations. (This has yet to be sized)

•We will investigate adding a third target segment (besides foodies and budget travelers) which resulted from our customer interviews: travelers on long term assignments who get tired of restaurant food daily and would prefer home cooked meals. (Hypothesis is that this is a small segment)

•To have a low-cost cost structure, we should empower hosts to do their own marketing activities through our web/mobile channels (eg special dinners, promotions etc)

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Conclusion:

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There is customer interest in the service and adequate market size at $7.8M.

Adjustments to business model are needed and are currently being made. Further customer face-to-face dialog is essential with additional emphasis on communicating with hosts.

With the changes made we believe the opportunity is the opportunity is worth pursuing to the next stepsworth pursuing to the next steps.

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