TLabs Showcase focus on startups featuring Stuttgart, Germany-based air ticket exchange system JumpFlight.
Who and what are you (including personnel and backgrounds)?
JumpFlight is an international online marketplace for second-hand flights. Persons unable to travel due to medical, professional, or personal reasons, can offer their flight tickets for sale without a commission on our platform. Travellers looking for cheap flight offers can scroll through the database and contact the sellers about flight exchange.
What financial support did you have to launch the business?
This project was launched without financial support.
What problem are you trying to solve?
We are trying to gain awareness that many flight tickets are transferable and can be sold to someone else. Every day, thousands of passengers have to cancel their flights, and the airlines fly with empty seats. It’s a waste of money, there is no reason why other travellers shouldn’t use these flight tickets.
Furthermore, we want the visitors of our site to know that a holiday cancellation does not have to be a complete financial lost. If you can’t find a buyer for your flights, you can still reclaim taxes and service charges from the airline.
Describe the business, core products and services?
We offer travellers a simple and user-friendly platform for posting flight offers. JumpFlight is a free service, you just have to be a registered user to be able to add flights to our database.
For persons looking for flight offers, we’ve implemented a search field right on the welcome page. In addition, the sections “All flights” and “Latest entries” give you a good overview of the current flights posted on our site. If you want to be informed about new flights on JumpFlight, just follow us on Twitter.
You can contact flight offerers by using an internal JumpFlight mailing system. If you would like to buy a flight ticket but you are unsure about transferring money to a stranger, you can choose to use the commercial JumpFlight mediation service. The financial transaction will then be processed by us.
As we want to reach travellers worldwide, the site is available in English, German, French, and Spanish.
Who are your key customers and users at launch?
Firstly, travellers around the world wanting to sell their transferable flight tickets. Secondly, spontaneous globetrotters and bargain hunters looking for cheap flight offers.
Did you have customers validate your idea before investors?
Not really. But anyone who has faced the problem of having to cancel flights knows how difficult it is to get a compensation for the unwanted tickets. After a thorough market research, we were convinced that travellers need an online marketplace like JumpFlight. The fact that we are getting new flight offers on a daily basis is a pleasant validation of our idea.
What is the business AND revenue model, strategy for profitability?
We want to provide our users a free service without obligations. Thus, we concentrate on financing our site through advertisements.
For our commercial mediation service, we charge 10% of the ticket price.
SWOT analysis – strengths, weaknesses, opportunities and threats?
Strengths:
- JumpFlight is an international and dynamic platform, covering a market niche.
Weaknesses:
- Unfortunately, not all flight tickets are transferable.
Opportunities:
- Every day, thousands of passengers have to cancel their flights. So there are plenty of flights out there which can be re-sold.
Threats:
- Big market players might start to offer second-hand flights as well.
Who advised you your idea isn’t going to be successful and why didn’t you listen to them?
The feedback we’ve received so far has been solely positive. Many of our users run in to our service by coincidence and are surprised to find a new to way save money on flights.
What is your success metric 12 months from now?
We want JumpFlight to become the online marketplace for second-hand flight tickets. Our site should not only be the number one address for travellers wanting to sell their flights, but also a site always worth a visit for anyone looking for cheap air fares.
NB: TLabs Showcase is part of the wider TLabs project from Tnooz.
Related posts:
Last month you wrote about re-ticket, which does basically the same thing and includes other forms of transportation.
Both services face a big common problem: they need to create a critical mass in one of the sides of the market, in order to have value for the other.
Since its a small niche, I think the two firms should cooperate in many ways and at least integrate their databases with each other.
Secondly, many of these tickets are already listed in various inefficient forms across the globe (craiglist, ebay, marktplaats etc) – you should either go there and copy/scrap these ads, or contact the posters and notify them about your system. So far each of these sites is able to show some data for their home market (Germany and Netherlands) and practically no data at all for almost any other market, while they aim to create a global solution.
Third, in order for these listings to have a real value they need to be balanced with the market prices in one way or another. Many of these rather random offers go for 150-200 EUR for an off season low cost flight ticket – this price is comparable and sometimes even unfavorable with the market prices for the same flight, and that’s before bringing the name changing costs into the equivalent – which you should also mention in the ticket cost.
All in all – its a real niche and a real problem, but it needs a really good effort in order to make a sustainable and scalable product.
@Kevin: Many thanks for choosing JumpFlight for your Q&A. We’ve put a lot of effort in the site and each review rewards us so much for it.
@Oz Har Adir: You are right, it’s the common ground for almost every project – to create a critical mass. This being said, the travel market is a huge one so I think our niche has potential to grow.
Your second point quite goes along with the first one. If this once becomes popular (and why shouldn’t it as it has advantages for both buyers and sellers), JumpFlight will help to prevent other inefficient forms of posting flights all over the internet. It helps to bring the offer and demand together in one place.
Third point: From psychological point of view, somebody who wants to get rid of his / her ticket is in many cases willing to sell it under the value it was bought. That’s why flight offers on JumpFlight can be real bargains for anyone looking for cheap airfares.
Thanks for your comments, we really appreciate your thoughts about our service. And we’ll try to do the most of it.
Best
Daniel
JumpFlight
There is a significant set of risks to this service, while admirable in principal, I believe it carries a number of burdens that should be evaluated before someone avails themselves of this service.
Specifically on the commercial side there are now so steep restrictions and penalties that apply to the cheapest fares on both legacy and LCC airlines as to make the process of changing a ticket an onerous task even within the same name. Breaking the contract by name changing carries serious penalties.
For international travel as a general rule – name changing is forbidden for both commercial and security reasons. Selling a ticket across borders is also specifically forbidden in the terms of the agreements for passage.
Non-Airline tickets generally can be exchanged easily. But as in the case of theatre tickets – there are a pretty good set of existing commercial operations such as Craigslist (USA) or Gumtree (UK) or even eBay. The number and complexity of scams on the first two are now so prevalent as to make the whole concept of open market exchange very difficult and fraud prone. In the UK for example it is actually illegal to sell airline tickets unless you are a licensed and bonded agent. The following answer to the question was provided by the Sunday Times to such a question:
A Sunday Times travel expert responds: The sale of tickets for air travel is strictly regulated in the UK, by the Civil Aviation Authority (CAA), and unless you are a bona fide travel agent with an ATOL (AIR Travel Organisers Licence), then you are not allowed to sell flight tickets. For this reason, eBay will remove attempts to sell tickets by the general public.
Despite the disclaimer in the Terms and Conditions – the UK regulator – CAA is actively checking on sites that enable the sale or exchange of tickets. Indeed in the UK eBay does not permit the sale of airline tickets. Gumtree however has 21 pages of results with the category airline tickets.
Here is an exact statement from Delta Airlines on the issue of transferring or selling Award Tickets:
Sale or Barter Prohibited
The sale or barter of mileage credit, vouchers, Award Certificates, or Award Tickets by SkyMiles members is prohibited. Delta will terminate or deduct mileage from the account of any member who violates this rule. Award Certificates or Tickets obtained through prohibited sale or barter transactions are VOID, invalid for travel, and will be confiscated. Persons trying to use such tickets will not be permitted to travel unless they purchase a ticket from Delta at the applicable fare.
Significant disclaimers should be made absolutely clear to the initial user who should have read and acknowledged the terms and conditions of carriage when they purchased the ticket: http://images.delta.com.edgesuite.net/delta/pdfs/contract_of_carriage_intl.pdf
Finally if there is true hardship for the consumer in the case of severe illness of an immediate family member or worse death – then the airlines are usually forgiving with specific policies for cancelling, exchanging or refunding such tickets.
Obtaining refunds for taxes is often very hard to do. Fees are not refundable.
The user is best served by either obtaining good flight insurance that allows emergency changes and alterations/cancellations under specified circumstances. Using a premium credit card such as American Express is also advisable.
I hope this puts things into perspective.
Cheers
Timothy
Hello Timothy,
many thanks for your comments.
The disadvantages that you have mentioned in your posting are probably the reason why exchanging flight tickets still is a market niche. And yet, you can find tons of offers from private persons all over the internet. This tells us that ticket exchange, nevertheless, takes place.
Every country has different regulations concerning air travel. You are right, most US-based carriers do not allow name changes (even a small typo might become a problem). If you have a look at our database, you will see that we hardly have flight offers from the States. The situation in the UK and Ireland is more complicated as many airlines such as EasyJet and Ryanair accept name changes, but the CAA prohibits the sale of flight tickets by private persons. And then we have countries like Germany where transferring flight tickets is legal and regulated by the airlines themselve.
Before launching our site, we were confronted with these problems. And we agree that due to the numerous regulations it’s not an easy task to begin with. But as we are working on a global platform, we believe that there are still more than enough transferable flight tickets out there which can be sold for a decent price. Travel insurance is not something every passenger has (especially when flying with the low-cost carriers) and we want to offer these people a chance of getting a compensation for their holiday cancellations.
Regards
Daniel
Daniel
I wish you well in this regard.
The Latin expression Caveat Emptor seems to apply in most of these cases. Having been involved in airline travel for more than 30 years I can say that an airline ticket has some of the most restrictive contract terms and conditions of any agreement that a consumer ever enters into. The vast majority of people clicking through the terms and conditions have never even bothered to read the T&Cs. Also most insurance policies do not cover voluntary cancellation.
In the 1980s the airlines clamped down on name changes as a way to prevent fraud. After 9/11 the conditions have become almost impossible to break. In my review for my comment yesterday, of the several hundred tickets ‘available’ and offered for sale on the 21 pages in the UK’s Gumtree site – I estimated that less than 20% of them were possibly eligible for refund or exchange of any sort. I would think that this number will fall further. When considering the cancellation fees and difficulty of actually exchanging them.
The requirements of APIS and Securelfight have made the opportunity to have a ticket that is exchangeable rather small in my opinion.
Sadly a number of people actually buying these tickets will find them useless.
Best of luck with your project.
Cheers
Timothy
Timothy,
Thanks for giving it such deeps thoughts.
The restrictions of airlines which do not allow to change the name on the ticket or rebook result because of profit maximisation. The flight ticket is a service which you bought and which you should be able to resell like a ticket to a baseball game.
The security is needed to be done properly in the terminal but not weeks or even month before the flight. This makes absolutely no sense and we are very optimistic this will change as it is something which hinders consumers to handle freely for a service they have paid for.
Best,
Daniel
JumpFlight
Daniel
I regret that you have just committed the cardinal sin of dealing with airlines. Assuming logical behaviour. I went to some lengths above to illustrate that the reasons for the restrictions were not only commercial.
Please read through carefully what I have written above. There are some detailed specific issues that I recommend you read and consider. You should also in my opinion have a commercial legal authority with experience in airline contract law review your terms and conditions to ensure that you are fully compliant with all the extant rules and regulations in which ever jurisdiction you intend to offer this service.
To address your point.
“The security is needed to be done properly in the terminal but not weeks or even month before the flight. This makes absolutely no sense and we are very optimistic this will change as it is something which hinders consumers to handle freely for a service they have paid for.”
Irrespective of what the consumer ASSUMED they had paid for this is absolutely not the case. The contract entered into by the consumer does not give free and unfettered permission to transfer title of the airline ticket to another. This is what you have clicked through when you tick that box.There are pages and pages of contract stipulations.
The analogy I would use is one everyone is familiar with. Namely music. You do not “own” the music you acquired on CD or from iTunes. You are granted limited rights to use that music in a certain fashion. Should you not comply then you forfeit those rights. In the same way – you do not own that seat and your contract terms as to what can and cannot be done are very specific.
For a humorous look at some of the contractual absurdities of regulation have a look at the post in http://www.consumertraveler.com/today/if-airlines-sold-paint/
On a serious note – I sincerely hope you are not banking your business on rationality coming to the process of the sale of airline tickets. I would bet a drink in any bar you care to nominate that this will not happen anytime soon. The reason being that security concerns will be raised that would prevent such afree and open exchange of tickets occurring at the airport terminal just prior to departure… to name but one of many reasons.
As noted – best of luck with this… you might want to consider continuing the dialog privately – timothyo@t2impact.com
Cheers
Timothy