Study on Luggage Tracking, Insurance and Assistance · PDF file© RocSearch. All Rights Reserved. 1 Sample Deliverable Study on Luggage Tracking, Insurance and Assistance Market

© RocSearch. All Rights Reserved. 1

Sample Deliverable

Study on Luggage Tracking, Insurance and Assistance Market

© RocSearch. All Rights Reserved.

Table of ContentsSection 1: Project Background and Timelines

Section 2: Summary

Section 3: Market Overview

▪ Understanding the Market

▪ Growth Drivers

▪ Key Market Developments

Section 4: Assessment of Potential Focus Countries

Section 5: Market Potential

Section 6: Competitive Landscape

Section 7: Key Takeaways


Sample – Disguised and AbridgedGrowth Drivers

Global Economic Growth

Rise in global passenger traffic is the prime factor driving the uptake of tracking,

insurance and assistance services

Rise in air passengers is the key driver for the upswing in

the adoption of baggage tracking and assistance services

and increase in travel insurance premiums Low Fuel CostGrowth in Low-Cost

Airline Capacity

Rise in air passenger is propelled by the following factors:

Other Factors Driving Global Assistance and Travel Insurance Market

1 Rise in Terror Attacks

➢ Post the terror attacks in Paris

(2015) and Brussels (2016), safety

concerns during travel has

increased among passengers

➢ This resulted in terrorism risk

coverage and security assistance

becoming one of the most sought

after components in a travel

insurance plan

2 Increasing Globalization

➢ Employee safety being the top

priority, employers are seeking

services such as travel insurance,

travel and medical assistance, and

security assistance

➢ Few other factors: expatriates

travelling to different countries in

pursuit of employment and

international students enrolling for

global assistance services to

mitigate any travel related risk

3 Growing Medical Concerns

➢ Outbreak of endemic diseases such

as Zika and Dengue fever became a

cause of concern for people travelling

to affected countries

➢ Regular updates and 24*7 assistance

in the form of vaccines, nearest

hospital/doctors, precautionary

measures, etc., from global

assistance service providers are

useful to mitigate health-related risks

4 Natural Disasters

➢ Natural disasters such as

Tsunami (2004), Japan

Earthquake (2011), Nepal

Earthquake (2015), etc., have

also led to safety concerns among

travellers

➢ During such a crisis, global

assistance companies are

responsible for providing regular

and timely updates, quick

medical assistance and

evacuation, etc., to the victims

and their families


Sample – Disguised and AbridgedMarket Developments

IATA’s upcoming regulation will likely impede the growth of the baggage tracking market

Percentage of Airlines

Sending Baggage Location

Status Updates to Passengers’

Smart Devices (2014–2019)

Implications

➢ With the resolution coming in effect from June 2018, the luggage tracking information shared by

airlines is expected to make luggage tracking and assistance services offered by third-parties

less attractive to passengers

➢ Further, lower baggage mishandling rate will strengthen passenger confidence in airlines and will

likely result in a lesser proportion of passengers opting for baggage insurance

60%

2014

2019

xx%

x%

Description

➢ The regulation—aimed at improving passenger satisfaction by providing them higher visibility on

baggage journey and reduced baggage mishandling rates—will require airlines to track movement

of each checked-in baggage from baggage drop point, on to the aircraft and to the carousal; and

share the information in real-time with passengers

➢ Airlines have begun to offer hand-baggage-only fare to passengers in short-haul

routes to tap price-sensitive passengers and those who prefer to travel light on short-

haul routes

‒ Hand baggage-only fares will likely help full-service airlines appear more

affordable in order to match low-cost airlines

‒ Further, the price strategy is expected to allow low-cost airlines to create more

value for passengers

➢ This trend may impact growth of the baggage tracking market as check-in baggage

are a prerequisite for baggage tracking services

Rise in Airlines Offering Hand Baggage-only Fares

Indicative List of Airlines That Launched Hand-baggage Only Fares

2013 2015 2016

“From 2018, with the introduction of industry-wide baggage tracking through Resolution

753, we are expecting to have a reduction in the number of bags that actually need

tracing, because the numbers of bags mishandled should reduce.” – Andrew Price, Head

of Airport Operations Management, International Air Transport Association (March 2016)

“xx–xx% of our European passengers only carry hand luggage. We

know people would rather pay less for their tickets and that is why

we are going to lower the price for flights.” – KLM (February 2014)

Industry

Opinion

International Air Transport Association’s Resolution 753



Section 2: Summary



▪ Potential Focus Countries

‒ Summary

‒ Key highlights for European countries

‒ Key highlights for APAC countries





Sample – Disguised and Abridged

Baggage mishandling rate per 1000 passengers in 2015 in Europe was higher (XX) than

the global average (XX)

Regional Comparison Summary

Mishandled Baggage6 per 1000 Passengers

(2007-15)Europe

US

APAC

xx

xx

xx

2007 2011 2015

xx

xx

xx

2007 2011 2015

xx

xxxx

2007 2011 2015

XX B

XX B

XX B

Mishandled Baggage per 1000 Passengers

and Total Passengers (Billion)

(2007-15)

Global

xx

xx xx

2007 2011 2015


(2007-15)


(2007-15)

Key Potential Countries:

UK, Germany, France and Turkey

Key Potential Countries:

China, India, Indonesia, Malaysia,

Thailand and UAE



In terms of travel insurance, UK, Germany and Norway accounted for XX of the

European market

UK

➢ The UK alone accounted for almost a third (~EUR XX billion) of the European market for travel insurance and assistance in 2014

‒ Key factors contributing to the country’s high market share were high frequency of residents travelling abroad, propensity to purchase

travel insurance and average policy prices

➢ However, over 2010–2014, the market was stagnant and grew merely at a XX% CAGR

Europe

Germany

➢ In 2014, the German travel insurance and assistance market accounted for ~xx% share within Europe and was worth ~EUR XX million

➢ However, German travellers typically buy less comprehensive cover, which translates into the total premiums averaging at one third

compared with the UK

Within Europe, UK was the largest market for travel insurance and assistance in 2014; the UK was worth twice more than Germany (the next largest market)

Other Key European Countries

➢ During 2010–2014, Poland was one of the fastest growing markets in Europe; posted a x% CAGR

➢ Other fast growing markets (in terms of GWP) were Norway, Romania and Turkey that grew at xx, xx% and xx% CAGR, respectively,

during 2010–2014

➢ During the period, the weakest performing countries in Europe were Czech Republic, Italy, Spain and the Netherlands; in these countries

the value of travel cover (in real terms) declined annually at an average rate of xx%, xx%, xx% and xx%, respectively

UKxx%

Germanyxx%

Norwayxx%

Othersxx%

European Travel Insurance and Assistance Market* –

by Countries

(€, 2013)

100% =

EUR XX

billion

“The situation within Europe is an interesting

reflection of the evolving shape of this industry

globally, because in every part of the world there are

young markets that are thriving and more mature

markets that are stagnating.” – Simon Tottman,

Consultant, Finaccord (March 2014)

*Note: Assistance refers to travel assistance services such as medical

evacuation, repatriation, lost baggage tracing, etc.

Potential Focus Countries – Europe



Section 2: Summary




▪ Baggage Tracking

▪ Travel Insurance

‒ Market Segmentation

‒ Market Sizing





Despite the x% drop in new passenger additions, the total addressable market for

tracking services increased by ~xx% in 2015/14

Baggage Tracking – TAM (Global)

xxxx

xxxxxxxx

xxxx

xxxx

2011 2012 2013 2014 2015

Global Air Passengers

(in million)

Global Baggage Mishandling Rate

(per 1000 Passengers)

2011 2012 2013 2014 2015

xx

xx

xx

xx

xx

xx

Average Number of Checked-in

Bags by a Single Passenger

xx

xx

xx

xx

xx

2011 2012 2013 2014 2015

xx

xx

xx

xx

Passengers Likely to Avail Tracking Services

Globally (in million)

➢ Throughout 2013-15, delayed bags continued to be the key reason for all the mishandled baggage; in 2015, delayed baggage accounted for more than three-fourth of the total mishandled baggage,

followed by damaged bags (xx%) and lost/stolen bags (x%)

➢ Transfer mishandling (XX million bags were delayed during transfers) continues to be one of the top reasons for delayed baggage in 2015

➢ According to the data from SITA World Tracer System, the total number of mishandled baggage reported a Y-o-Y decline of x% to reach XX million in 2015 from XX million in 2014

➢ During 2015, total number of new passengers likely to avail tracking services declined by x% Y-o-Y to reach XX million. This is despite x% Y-o-Y increase in global passenger count to XX billion

- The improvement in baggage handling was primarily driven by the adoption of various technological initiatives taken by airlines

➢ In terms of the cost, the aviation industry incurred EUR XX billion as the total baggage mishandled cost in 2015, which witnessed a xx% reduction from the previous year

- The bag mishandling cost per passenger dropped by xx% to EUR XX in 2015 as compared to 2014

Key Highlights

New Passengers AdditionsTotal Addressable Market

xx

*Note: The market size estimate is bit conservative, but this is the best possible

estimate of the tracking market which can be provided


Sample – Disguised and AbridgedMarket Segmentation – Travel Insurance

Retail/leisure constitutes the largest segment of the global travel insurance market

➢ In this segment, policies are mostly for

B2B and are therefore, sold directly to

corporates

➢ These policies (provided to

employees) are part of the employer’s

group business travel insurance

arrangement

➢ Benefits and degree of coverage are

often customised to suit the travel

needs of the corporates

Corporate Segment

Global travel insurance and assistance market is broadly classified into retail/leisure and corporate segment

Global Travel Insurance Market

– by Customer Type*

(as a share of GWP**, 2015)

Retail/ Leisure

xx%

Corporatexx%

Segmentation of Global Travel Insurance Market

Note:

* Estimated share based on inputs from expert consultation

** GWP refers to gross written premium

In 2015, the global travel insurance market

(including assistance service) in terms of

GWP was estimated at EUR XX billion

Within the retail/leisure segment, two options exist - Single Trip

and Annual Subscription policies

Segmentation of Retail/Leisure Travel Insurance – by Policy Type

Retail/Leisure Segment

➢ Retail/leisure travel insurance segment (also referred to as

stand-alone) primarily targets B2C segment

➢ Hence, travel insurance covers are typically purchased by

individuals (which may also cover family members) for

their personal trips

‒ In cases where individuals are not covered under a

corporate policy, they can also purchase these

policies for business-related travel

➢ Mostly standardised, off-the-shelf policies are offered

under this segment

Focus Area of

Safe Bag Single Trip

Annual Subscription

➢ Single-trip travel insurance policy is the preferred choice for

most passengers as these are affordable and better suited to

the needs of one-time fliers

➢ Also, risk coverage is limited to the specific trip for which the

policy was purchased

➢ Annual subscription provides risk coverage across all trips

that fall within the annual subscription period

➢ Compared with a single trip, these policies provide greater

value to frequent fliers

1

2

Bundled Travel Insurance Cover

➢ As a push marketing strategy, travel insurance coverage is also

at times bundled with the price of a travel ticket, or if tickets are

purchased via (certain) credit cards / bank accounts

‒ However, policies linked to credit cards or bank accounts

are only applicable when the air ticket is purchased using

one of the payment channels



Global Retail/Leisure Travel Insurance and Assistance Market*

(2013–2017F)

*Note: Excludes policies linked to credit cards and bank accounts

➢ Over 2013–2017, the GWP for travel insurance and assistance is projected to register a ~x% CAGR

‒ Growth in air travel and tourism are identified as the key market drivers because they lead to rise in the

incidences of medical emergencies, and baggage loss or delay, etc.

‒ According to the United Nations World Tourism Organization (UNWTO), globally the international tourist

arrivals grew xx% Y-o-Y at ~XX billion in 2015; tourist arrivals in Americas (i.e., LATAM and North

America) and APAC grew nearly at x% Y-o-Y, while, in Europe it rose by x% Y-o-Y

➢ During this period, number of insurance and assistance policies grew at a relatively lesser rate (compared

with GWP) of x% CAGR; this is partially due to an increase in the base premium rate and passengers’ rising

focus on buying annual policies

Market Size – Travel Insurance

xx xx xx xx xx

XX XX XX XX XX

2013 2014 2015 2016 (F) 2017 (F)

Gross Written Premium (€ billion) Number of Policies (million)

In 2015, the global travel insurance and assistance market accounted for EUR XX

billion, and is projected to grow at XX% CAGR until 2017

Retail/Leisure Travel Insurance – Market Size and Forecast

Breakdown of Travel Insurance Components by GWP

Travel Insurance

Policy

Medical/

Accidental

Travel

Inconvenience

Specialised/

Optional

Sickness, accident, evacuation, death, and

repatriation

Baggage loss, delay and damage, trip

cancellation/interruption, etc.

Coverage for adventure sports (such as

skiing)

Components Inclusions~Share in the

Total GWP

~xx%

~xx%

~xx%

GWP linked to

the baggage

insurance

~x–x%

Medical and

accidental cover is

the main risk factor

for which majority

of individuals

purchase travel

insurance; hence,

accounts for a

major share



Section 2: Summary





▪ Business Models

▪ Product Portfolio Mapping

▪ Channel Structure and Presence

▪ Key Companies Snapshot

▪ Price Mapping

▪ Competition from Airlines



Prevalent business models in baggage tracking market

Business Model – Baggage Tracking

1. Partnership with Airlines: Smart tag companies as well as electronic tracking device companies are partnering with airlines for product development, testing, and research. For

instance, Smart tag company, Company 1, has partnered with Lufthansa airlines and electronic device company namely Eviate has collaborated with Air France

2. Partnership with Luggage Manufacturers: Electronic tracking device companies are collaborating with luggage manufacturers to develop an in-built tracking feature in the

suitcases itself. For example, LugLoc has partnered with manufacturers namely Samsonite and Trunkster

3. Bulk Procurement Contract: Big corporate houses are increasingly partnering with tracking companies for bulk purchase of white label tracking devices/tags. These products

are primarily used for corporate gifting purposes, branding and promotional initiatives. For example, TRACE ME

Cu

rren

t B

usin

ess M

od

els

Smart Tags: Also known as e-tags;

use technologies such as NFC, GPS,

GSM, RFID, etc.

Distribution Channels

• Company Owned Websites

• Direct to Company

Electronic Tracking Device: Tracking

device is placed inside the luggage;

employs technology such as GPS,

GSM SIM and Bluetooth



• Online Marketplace


Smart Luggage: These are suitcases

with in-built technology that assist in

geo tracking



• Retail Stores


Conventional Tags: These tags do

not use any technology but have a

unique identification code used for

tracking



• Online Marketplace

• Airports


Low Med High

Technology Meter

Em

erg

ing

Bu

sin

ess

Mo

dels



Online channel, airports and retail stores are the prominent channels used by baggage

tracking companies to reach the end-consumers

Channel Structure – Baggage Tracking

Notes:

* PIR (Property Irregularity Report)- In the event of baggage lost at the destination airport, customers contact the airline staff where they are issued a copy of PIR for future reference

** Baggage Registration ID- A unique number which is generated at the time of baggage wrapping by the baggage wrapping companies. This number is used for all baggage tracking related activities

On

lin

e M

ark

etp

lace

Airp

orts

Co

mp

an

y W

eb

sit

e

Reta

il Sto

res

➢ This mode of selling saves the

merchant from any regulations

or restrictions imposed by big e-

commerce players

➢ Few examples:

‒ Conventional Tags -

GlobalBagTag, TRACE ME

‒ Smart Tags – Company 1,

tag-a-bag

‒ Track Devices – LugLoc,

SpyTec

➢ Companies such as

globalbagtag, TRACE ME, etc.,

have their presence across

multiple channels – company

website and online marketplaces

➢ Few examples:

‒ Conventional Tags -

Okoban, Victorinox , Dynotag

‒ Smart Tags – tag-a-bag

‒ Track Devices – Trakdot

➢ This model is more prominent

among baggage wrapping

companies like Seal & Go,

Secure Wrap, etc.

➢ To avail their services,

customers need to submit the

PIR* along with unique baggage

registration ID**

➢ Few examples:

‒ Seal & Go, Secure Wrap

➢ Device tracking and smart

luggage companies sell their

products via physical retail

stores

➢ Few examples:

‒ Smart Luggage –

Samsonite, Trunkster

‒ Track Devices – LugLoc

Dis

trib

uto

rs

➢ Smart tags and device manufacturers appoint official

distributors for their products, in places where they don’t

have significant geographic presence

➢ Example:

‒ TRACE ME has choosen Worldwide Insurance

Solutions (WIS) as its official distributor in Middle

East, Africa and Subcontinent

Dire

ct S

ale

s

➢ In case of bulk buying (corporate gifts, branding

initiatives, etc.), companies contact the manufacturers

directly to close the deal

➢ Example:

‒ Tracking device manufacturer, LugLoc, has

partnered with leading luggage manufacturer,

Samsonite, to offer tracking solutions

Sale

s A

gen

ts

➢ Sales agents, usually working on commission basis, are

also hired by companies to sell the products for B2B

purposes

➢ Example:

‒ Brokers in Lloyds Market in UK work as sales

agents for TRACE ME

Channel Structure – B2C Channel Structure – B2B



Product Portfolio Mapping…(1/2)

Product Portfolio – Baggage Tracking

Companies Website Baggage WrappingBaggage Tracking

Baggage

Compensation

Baggage

Assistance5TD1 CT2 ST3 SL4

Company 1 XX O O P O O O P

Company 2 XX O O P O O P P



Company 5 XX P O P O O P P

Company 6 XX P O P O O P P

Company 7 XX P O P O O O P

Company 8 XX O O P P O O P


Company 10 XX O O P O O P P

Company 11 XX O O O P O O P

Notes:

1. Electronic Tracking Device:

Tracking device is placed inside

the baggage; employs technology

such as GPS, GSM SIM and

Bluetooth

2. Conventional Tags: These tags

do not use any technology but

have a unique identification code

used for tracking

3. Smart Tags: Also known as e-

tags; use technologies such as

NFC, GPS, GSM, RFID, etc.

4. Smart Luggage: These are

suitcases with in-built technology

that assist in geo tracking

5. Baggage Assistance: Any

service provided by a company to

retrieve and deliver baggage to a

passenger, either through a

customer care center or website

(Lost and Found section)

1 2


Sample – Disguised and AbridgedCompany Profiles – Baggage Tracking

Company 1

Global

Smart Tags Company XX 2010London, United

Kingdom

Geographical Coverage

About the Product

• Company 1 is a microchip baggage tag that can

be used across airports worldwide

• Designed in consultation with Lufthansa airlines,

airport microchip companies, and other travel

industry stakeholders (insurers)

• Supports multiple technologies, namely RFID

microchip, NFC microchip, and QR Code

• Offers basic tracking feature using unique

identification number printed on the tag

Baggage

Wrapping

Baggage

Tracking

Baggage

CompensationBaggage

Assistance

Product Offerings

Company

Owned

Website

Online

MarketplaceAirports Retail

Stores

Channel Presence

• Retail Price (1 tag): EUR 29.4*

• B2B Price (1,000-10,000 tags): EUR

9.2*/tag

Product Pricing

Partnerships

• Partnered with Allianz for providing baggage

insurance to corporates

• Company 1 has also partnered with major

baggage handling companies, which have the

expertise to look through the global lost

baggage databases

• Partnered with Lufthansa Airlines for product

development

Awards and Accolades

• Company 1 was shortlisted for Luxury Gift of

the Year (2015) at Spring Fair, the largest

retail event in Europe

• At the Annual General Meeting of IATA,

Company 1 was showcased by Lufthansa as a

way to prevent baggage loss globally

*Note: Price includes 1 year subscription



Service Portfolio Mapping…(1/2)

Services Portfolio – Insurance & Assistance

Company WebsiteAssistance Services

Travel InsuranceTravel Medical Security

Company 1 XX P P O P

Company 2 XX P P P P


Company 4 XX O P P O

Company 5 XX P P P P


Company 7 XX P P P O


Company 9 XX P P P O


1 2

Catering to B2C segment



Company 2

Company Profiles – Insurance and Assistance

1985

North America, Latin America, Asia Pacific, Middle

East and AfricaGeographical Coverage

About the Company

Insurance and Assistance

Zurich, Switzerland

• In terms of number of partnerships with travel trade, transportation and financial organisations, XX is the leading insurance and assistance provider in the US

• On 14 January 2016, XX Limited was acquired by Chubb Corporation

• In March 2015, XX Group partnered with Transavia23 to provide the airline’s customers travel and flight cancellation insurance cover

- Travellers who use Transavia website for booking tickets will be able to add travel and cancellation insurance cover by XX Insurance

• In Singapore, Bank of China credit card customers can avail XX Travel Insurance policies at attractive discounts

• Citibank partners with XX in the UK to offer annual holiday travel insurance policy to Citi Plus and Citigold account holders

Travel

Insurance

Baggage

Coverage

Travel

AssistanceMedical

Assistance

Security

Assistance

Service Offerings – B2C

Channel Presence

Company

Website

Online

Brokers22

Travel

AgentsBanks

Insurance

Brokers

Credit

CardsAirlines

Key

Highlights

Provides service Information not available from secondary sources Does not provide service

A++AM BEST Ratings29

XX

1 2



Indicative Price Mapping – Travel Insurance

EvacuationSingle-Trip Medical ComprehensivePlan Type

14 17 155 159 190 311

327242179

115 217

120 173 275

10 25 28 69

55

199 225

43027099

225

*Note: Above chart is just for representative purposes; prices and

features may vary basis the business case considered

Business Case Considered:

Origin: US I Destination: UK I Departure: 16 Jan 2017 I Return: 20 Jan 2017

Age of Traveller: 32 years I Resident State: Florida I Citizenship: US I Trip Cost: $5000

Initial Payment Date: 26 Dec 2016

All prices are in USD

$100 $200 $300

Price Mapping – Travel Insurance


Sample – Disguised and AbridgedOur Offices

United Kingdom

Berkeley Square House

Berkeley Square

London W1J 6BD

United Kingdom

T: +44 20 8263 6034

India

A-16, Sector 16, Noida

U. P. - 201301

India

T: +91 120 4017100

Hong Kong

28th Floor, Fortis Tower

77-79 Gloucester Road

Wan chai, Hong Kong

T: +852 5801 4643

United States

77 Park Avenue #1515

Hoboken,

NJ 07030

USA

T: +1 30 3502 5409

Business Enquiries – [email protected] | General Enquiries – [email protected] | Webpage – www.rocsearch.com

South America

Pedro Agrelo 865.

Rosario, Santa Fe.

Argentina

S2005OPC

T: + 54 341 453 1088

About RocSearch

Please visit www.rocsearch.com for more details on the company


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Study on Luggage Tracking, Insurance and Assistance · PDF file© RocSearch. All Rights Reserved. 1 Sample Deliverable Study on Luggage Tracking, Insurance and Assistance Market