When Outski founder Greg Nikolson was hit with the stark realisation that a dream trip to Europe was not going to happen for a long time because of his young family, he decided to go ahead and plan it anyway.
However, when he went online, he found no site which could help him research and plan for something three to four years away so decided to build it himself.
Outski’s team consists of CEO and founder Greg Nickolson, COO Mark Schmidt, CTO Carlos Gonzales, CMO Robert Morrison and creative director Kiel Jared.
The startup is also working with a number of advisors including Andrew Lombard, chairman at eTelemetry and CEO at SocialWhirled, Tate Brown, CFO of SocialWhirled and Krista Pappas, former global head of business development of Bing Travel.
Outski has raised $320,000 so far and is currently raising a further $680,000 which will finalise its seed funding.
The startup is initially targeting US Millennials who enjoy travel don't have the financial means to instantaneously book travel. There are 80 million Millenials representing 25% of the US population and with an annual buying power of more than $200 billion.
When it comes to rivals, Outski says it has "integrated financial into social and wrapped it around travel" and to replicate that you would need to merge, TripIt, Gogobot, Expedia and Smartypig.
Outski sees revenue from a number of avenues.
- Vacation Savings Accounts – the startup earns interchange each time a user spends money using an Outski Travel Savings Card, approximately 1.5% of the total transaction. Interchange fees originate from the merchant over the acceptance network (i.e. Discover, VISA).
- Commissions – it earns various commissions for travel bookings, the sale of complementary goods and services and travel insurance which range from 2% to 30% of the total transaction.
- Big Data – imagine a travel marketing database, updated regularly by millions of users providing forward-looking data, not previously available, that knows WHEN people want to travel, WHERE they want to go, WHY they want to go, WHO they want to go with, WHAT they want to do when they are there, and HOW MUCH MONEY they are planning on spending.
Founder Greg Nikolson says:
"Although not currently modeled for monetization, we see enormous value in this information."
What problem does the business solve?
Fundamentally, it solves two problems. First, people always talk about taking trips, but they rarely come to fruition. Why? We have found that the top three reasons are no time (or they believe they have no time), have not planned it or, do not have the money to take the trip.
Second, a survey commissioned by Hotwire in early 2013 discovered that the typical American worker let 9.2 paid vacation days slip away in 2012, a 48 percent increase from the previous year. In fact, the number of unused paid vacation days increased to 12 by the end of 2013.
Further studies find that 87 percent of more than 2,000 adults polled said they’d be inclined to travel if they felt they could afford a trip. This is becoming more than a trend, it is a problem.
Luckily, our platform helps consumers solve these problems by providing travel related financial services to consumers together with associated group planning and social collaboration tools in order to facilitate coordination and planning of their travel with friends and family.
In short, Outski’s technology allows everyone, rich or poor, to experience the world through travel. It gives them an easy, and effective way to get from “we ought to do this” to actually doing it.
How did the initial idea evolve and were there changes/any pivots along the way in the early stages?
We were originally going to require users to book their travel with us, but then realized we were creating this site for consumers, not Outski. We did a huge pivot and decided to let our users spend their saved funds however they wanted. While we hope that they will use it for travel, nothing stops them from walking across the street and using their Travel Savings Card to buy something like groceries for example. They can use their saved funds where ever Visa/Discover is accepted. They can even pull cash from an ATM as it works just like their existing debit/credit card.
In developing our marketing plan, we initially thought that we would focus much of our marketing resources on developing B2C relationships. While this is still a large portion of our initial marketing (in order to increase brand awareness) we have developed a B2B solution called 401(play)™.
Now, one of the primary methods of encouraging our target audience to participate in using our technology is by marketing our 401(play)™ program. This program allows employers to enhance their benefits package and improve employee morale by enabling personnel to contribute a portion of their paychecks to their Vacation Savings Account.
The motivation behind this program is that it improves morale, reduces stress and employee burnout and is a unique offering in a benefit package that will allow employers a measurable way to contribute to their employee’s performance and welfare.
Why should people or companies use the business?
As well as the Hotwire research, a 2013 Right Management survey found that 70% of US workers do not use all their vacation time with the reasons cited above.
The bottom line is that we are solving 12 problems (the days not taken) and employees get that “refresh” that makes them healthier and more productive (as well as reducing burn-out). We believe that this benefit results in a “win-win” for employers and businesses.
What is the strategy for raising awareness and the customer/user acquisition (apart from PR)?
In addition to debuting its platform at a technology conference in early May, Outski will launch marketing resources to secure early adopter end users and primary channel partner alliances.
To acquire early adaptor users, three main marketing thrusts that will target Millennials, including parents, women, and college students. These thrusts will consist of social media, internal marketing, and external marketing initiatives:
Social Media:
Campaigns on Facebook, Twitter, Pinterest, Youtube, Google Plus and Instagram will be administered by Advice Interactive Group.
Multimedia Videos: Advice Interactive Group will facilitate production of videos intended to promote awareness of Outski, explain the features and benefits of the platform, and to create excitement about the site. These videos will appear on the website or Youtube.
External Marketing:
- Outski’s largest sustained initiative lies in a B2B solution called 401(play)™. This program will initially target small to mid-sized firms and progress to large / Fortune 500 companies by leveraging existing personal relationships and relationships through current channel partners as well as industry events.
- Pi Sigma Epsilon Sales & Marketing Challenge: Ten PSE fraternities at US colleges and universities will each be awarded a $2,500 budget to develop a unique marketing campaign to promote Outski on their respective campuses. The winning fraternity of this 10-week challenge will be awarded $10,000. We know from experience that these fraternities have a need to raise money, and Outski’s Marketing Challenge not only provides them an opportunity to raise $10,000, but also provides an excellent real life, competitive marketing experience.
Internal B2C Marketing:- Playaway™: offering different vacation packages each week such as cruises that include airfare and activities for a low monthly payment over a set term of months.
- Vaca-A-Day Giveaway: a daily draw to win a cruise when users sign up for a VSA.
- Rewards Program: launch an incentive program to VSA users to encourage use and spending on the card.
- Channel Partners: establishing relationships with destination event sponsors such as Red Frog Events, Tough Mudder, and others that will enable them to provide their own past-event participants with travel packages and incentives to participate in upcoming events using Outski’s Channel Partner Portal.
Where do you see the company in three years time and what specific challenges do you anticipate having to overcome?In three years we expect to have a large international presence (note: currently, we can only offer Vacation Savings Accounts to US residents). We intend on making this a global product! Our challenges are directly related to this as we have to create new relationships with financial institutions in each country that we intend to penetrate.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
Many people in our target market are used to just charging money on a credit card to travel and worrying about it later, or just foregoing it altogether. Those days are gone. We have created a financially responsible way to help people actually take those trips on a mobile and desktop platform that is convenient and easy to use.
What other technology company would you consider yourselves most closely aligned to in terms of culture and style... and why?
Asset Technology, because I founded that company too (kidding!)
We are pretty young and don’t really know this answer quite yet. Our mission is to help people live better lives by enabling them to travel. I am sure you have never heard that one from another start-up ;-)
Tnooz view:
This is an intriguing startup. Holidays have moved from being perceived as a luxury to being a necessity, even a right! And yet, they are one of the biggest outlays households make every year and require effort and emotion in terms of planning and catering for everyone.
So, Outski provides a place to go ahead and plan that holiday as well as a vehicle to start saving for it. It's marketing plans are far-reaching and clever from the B2B aspects and employee benefit packages to the university fraternity and social media elements.
It is also astute in targeting Millenials who may not have the money now but many will likely have the funds, not to mention desire, to see the world going forward. And, it taps into a time when people are still uncertain about the economy and financial security but hold onto the dream of travelling or use the funds for something else if needs be.
There are other interesting elements to Outski - the big data play for example. Lots of companies are bandying words such as predictive and anticpatory around so a platform that holds intent married with a financial package could be seriously valuable.
The eternal problem of achieving scale remains and only going after only the US market initially could make it even trickier. Another potential issue is getting people to understand what it's all about - save money for something I'd like to do in three our four years time might not figure in the minds of a lot of Millenials living for the here and now.
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