KelBillet is a French multimodal search engine that indexes fares for trains, buses, airplanes, cars, and rideshares. It's aimed at French travelers taking domestic and short-haul trips.
In early 2013, the site averaged 1 million unique visitors a month, says the company.
The site also supports a peer-to-peer marketplace for second-hand, non-refundable train tickets. (The marketplace grew out of an online forum launched in 2005.)
KelBillet's revenue model relies on cost-per-click (CPC) advertising for transportation operators and retailers, providing referrals to qualified leads.
The company says its conversion rates are above the industry average, from 1% to 15%, depending on the transportation mode (plane, bus, or train).
In 2010 the company got its start thanks to a funding round of 200,000 euro from angel investors. It's now preparing its next round.
Q&A with CEO Yann Raoul:
How is the way you are solving this problem more special or effective than previous attempts you or the market has seen before and how different do you have to be to succeed?
Until 2009, French railway operator SNCF was exclusively allowed to sell tickets online for its intercity domestic journeys, but European and French regulators took away its monopoly.
When that happened, my co-founders and I thought this would lead to a growing complexity for the traveler to find the right transportation mode at the best price.
So we decided to perform a huge R&D effort in order to build the first multimodal search engine, including all transportation modes (bus, train, plane, car), plus all consumption models (classic ticketing, second-hand ticketing, ridesharing).
As of early 2013, we have 21 referenced companies on our search engine and 780,000 registered members. We are expecting 1.6 million unique visitors in March.
Many clients, meaning, French transportation operators and online retailers, have told us that KelBillet is their main channel for audience acquisition besides Google search engine marketing, especially on the train and bus segments.
Why should people or companies use your startup?
We have defined 3 main scenarios where KelBillet provides killer services :
- Leisure travelers who want to find cheap tickets and schedules for their domestic and cross-border journeys can find them in 2 clicks on our site.
- Train and bus travellers who cancel their journey and have non refundable ticket may use our site to sell it to another traveler.
- Transportation operators (or retailers) may boost their sales volume for domestic and cross-border trips on a performance basis, thanks to our highly qualified audience and excellent conversion rates.
Other than going viral and receiving mountains of positive PR, what is the strategy for raising awareness and getting customers/users?Indeed, we could afford to grow with our own funds but we want to go fast: We are currently looking for a travel or media company which would help us to reach the next steps, via a strategic partnership.
Taking full advantage of our 780,000-member-database, we send daily personalized alert emails (meaning, notifications of when a cheap ticket on their route is available) plus a weekly editorial newsletter.
Word-on-mouth is currently our best way to get new users. We add new features every week! We get several hundred messages with feedback each day, just to thank us, or to give us tips to improve our product. Our 7-person team makes customer service a priority and we always react quickly to user feedback.
Plus, the economic crisis is generating new social behaviors, leading to the strong development of ridesharing.
What other options have you considered for the business and the team if the original vision fails?
The first step is to achieve success. Our company is soundly profitable, and we are now considering fresh challenges, such as adding innovative services for travellers and going international.
For example, we are considering creating a service to help UK travelers compare bus and train ticket fares for their domestic journeys, and we are interested in receiving feedback on that and other international expansion ideas from our industry peers in Europe.
What mistakes have you made in the past in business and how have you learned from them?
Innovation is in the genome of our company. Beside the development of our multimodal search engine, we spent time to build a great optimized adserver where affiliation banners would display dynamically, depending on the user behavior and navigation.
It was 2 years before real-time bidding (RTB) and ad exchanges became popular in France. Our results were quite good: more than 50% performance growth…but a 10x ratio would have been required to make our system truly competitive.
We learnt that only very few companies reach success when they innovate on several activities at the same time. Focusing on the highest-potential activity is key. That analysis is easy for everyone to endorse in theory, but it's difficult to do in practice on your own business in the heat of the moment.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
Internet is changing behavior; the financial crisis is changing behavior; development of mobile is changing behavior; regulatory evolution is changing behavior.
So today's legacy travel companies, established Interent business, and rising startups all must stay on their toes to respond to changing behavior.
I think there's an opportunity for a few nimble startups to leap ahead.
Plus, there is still a lot to do in the travel industry to enhance and simplify the traveler's experience.
Tnooz view:
KelBillet has deserves to be proud of itself for having achieved profitability so quickly.
The market potential is huge: About 3 billion euro in train tickets are sold online in France each year.
It faces stiff competition from Rome2Rio, a multi-modal search tool that added pricing this week.
It is also rumored that SNCF will attempt to launch a multi-modal point-to-point booking competitor soon.
Additional threats are ZePass.com and LeBonCoin.fr, plus "infomediation" portals such as EasyVoyage, Liligo (owned by SNCF), Google, Travelzoo, Skyscanner and Momondo.
KelBillet's focus on scaling quickly has been smart.
But has it identified the 20% or so of customers who give it the great majority of its results (in sales, repeat business, and word of mouth marketing).
Adding effort to marketing seems like it would produce the greatest return on investment right now, if that effort was focused on improved marketing of the 10% or 20% of the product line that generates 80% of the profits from either customers or clients.
How to better delight the small sub-set of customers who are driving its business? Can it serve that the 10% or 20% of customers better than any competitor? Can it then expand to target customers with those similar characteristics.
The company's innovation has to be product led, and supported by savvy marketing.
Is KelBillet's staff set up to identify the most profitable customers, to find ways to provide an outrageously high level of service to those amazingly profitable customers only (not to everyone).
"Key customer" retention should be 100%. Focusing on retaining key customers is a far more effective use of time than scaling up to a mass market. It's so easy to lose sight of this. If these clients are not sending in comments about how surprised and pleased they are at the level of service, KelBillet might need to work smarter.
Stop thinking about averages and customers as a whole and target the vital few.
Which transportation and retail companies can they provide outstanding service service to? (You'll know it's "outstanding" service when you start receiving positive comments from clients that they are surprised and pleased.) Will KelBillet put less time into its average customers, so it has time to focus on its best customers?
What's a more imaginative and useful way of helping these best customers than any other competitor is offering?
Has the team hired the best marketer it could? Can it increase its sales to them? Can it go back to any super-profitable customers that it may have lost in the past two years and make an intelligent pitch to them to win them back?
A danger of foreign expansion is that the company might be distracted by the challenges of understanding new customers, clients and train products rather than building a Chinese Wall to protect the 10% or 20% of amazingly profitable French customers (on the business side and/or the consumer side) that it already has.
One answer to those questions might be the CEO's statement: "We are currently looking for a travel or media company which would help us to reach the next steps, via a strategic partnership."
It will be interesting times ahead for KelBillet. Wishing it continued success.
NB:TLabs Showcase is part of the wider TLabs project from Tnooz.