ANNEX II TO DUP
MARKET ANALYSIS
Project Report
Shared-cost RTD
Project acronym: TOURBOT
Project full title: Interactive Museum Tele-presence through Robotic Avatars
Contract Number: IST-1999-12643
Key Action:
3
Action Line:
3-2-3
Market Analysis
Project Report
TOURBOT: Interactive Museum Tele-presence Through Robotic Avatars
Annex II to DUP:
Market Analysis
Date Produced:
December 28, 2000
Authors:
Takis Halkidis, George Giannoulis and Panos
Trahanias
Contents
1
2
3
4
5
6
Introduction .................................................................................................................. 3
Overall Market Characteristics .................................................................................... 3
2.1 Market Definition .................................................................................................. 3
2.2 Market Characteristics ........................................................................................... 3
2.3 Potential Market Size............................................................................................. 5
Competitive Analysis ................................................................................................... 6
SWOT Analysis ........................................................................................................... 6
4.1 Strengths ................................................................................................................ 6
4.2 Weaknesses ............................................................................................................ 7
4.3 Opportunities ......................................................................................................... 7
4.4 Threats ................................................................................................................... 8
Competitive Strategy .................................................................................................... 8
5.1 Added Value .......................................................................................................... 8
5.2 Pricing .................................................................................................................... 8
5.3 Market Approach ................................................................................................... 9
5.4 Network of Partners ............................................................................................... 9
5.5 Market Positioning .............................................................................................. 10
5.6 Promotion and Marketing .................................................................................... 10
Conclusions ................................................................................................................ 11
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Market Analysis
1
Project Report
Introduction
The TOURBOT project is currently midway its development cycle. By the end of 2001,
the TOURBOT consortium will ultimately come up with a turnkey solution for a robotic
avatar for museums and art galleries. The robot will be able to act as a tour guide, either
physically, for on-site visitors, or virtually, via the internet. Through the latter option, the
robot will open a whole array of new ways of access to the museum, uniquely utilizing
new technology in an environment of culture and heritage.
At the current state of the project it is not yet possible to devise a thorough marketing
plan, partly due to lack of resources for performing it and, for the most part, due to the
incomplete stage of the project. However, due to the strong exploitation interests of the
TOURBOT consortium, a preliminary market analysis has been carried out, which is
presented in the current report; moreover, the objectives for market success of the
application are defined and analyzed.
2
2.1
Overall Market Characteristics
Market Definition
The potential market for the pure TOURBOT application consists, as a first stage, of
museums and art galleries. Although “Science” and “Technology” museums are the first
obvious candidates, one should by no means underestimate the huge potential of all kinds
of museums, regardless of their content. An analysis of the key issues that will shape the
profile of potential customers is made below, in “market characteristics”.
2.2
Market Characteristics
Worldwide, the museum sector is characterized by a number of common denominators,
most of which can be derived by the definition given to the term museum by ICOM:
“A non-profit making, permanent institution in the service of society and of its
development, and open to the public which acquires, conserves, researches,
communicates and exhibits, for purposes of study, education and enjoyment,
material evidence of people and their environment”.
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Market Analysis
Project Report
Beyond their common characteristics, there is a wide spread of different types of
museums today. The most basic differentiators affecting the market for an application
like TOURBOT are the following:
 Size. A large museum will in most cases have the necessary budget to purchase the
TOURBOT system, but might need more than one to cover the possibly wide space.
This could be beneficiary if multiple robots can be afforded, but might raise the
overall necessary cost on one hand, yet lowering the cost per robot on the other.
 Budget. This feature is separated from size, since there are smaller museums with
larger budgets around, such as specific cases of private museums, or museums with
specific collections and higher visitor’s rate.
 Type of collections. According to this feature a vast spread can be found. As noted
before, the interest on the museums’ side may vary depending on content. Still,
content should not be considered as an obstacle but rather as a characteristic that
might dictate particular customization on the robotic avatar. A robot could perfectly
be used as a guide in science or archaeological museums for example; in the latter
case, appearance customization might be preferable in order to make it suitable to its
surroundings.
 Electronic infrastructure. This parameter again varies enormously from one museum
to another. As a norm, the museums with a high level of electronic infrastructure
might be more receptive towards TOURBOT compared to the other. More
specifically, the ones having already an Internet site with important resources and
information about their collections potentially constitute excellent candidates for
TOURBOT since its technology provides an effective and affordable way to combine
the real museum environment with their virtual resources. Additionally, museums
already familiarized with the use of multimedia and other Information Society
technologies are adaptable and open to new technologies and tools.
On a general note, museums are run and staffed by highly knowledgeable individuals,
who are considered experts in their respective fields. Therefore, in many cases a careful
approach must be followed, in order to show them the benefits to be gained by adopting
such a high technology solution in their sector.
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Market Analysis
2.3
Project Report
Potential Market Size
When trying to estimate the number of museums worldwide, one is faced with certain
difficulties, mainly arising from the lack of uniform treatment from the various sources.
Therefore, any quantitative figures that are provided can not be considered as definite but
rather as indicative of the potential size of the sector. According to the International
Directory of Arts & Museums of the World, K.G. Saur Verlags, there are about 77,000
museums and art galleries in the European Union today, and about 116,000 worldwide. It
should be pointed out that these numbers might appear rather large, which is due to the
fact that art galleries are also included. Our effort to verify the correctness of these
figures was unfortunately not successful since different sources do not provide consistent
information.
In an attempt to taste the initial market reaction, a survey consisting of telephone
interviews was conducted. The findings of this survey are summarized in a separate
report. For the purposes of the current study it suffices to mention that, even in this
incomplete stage of the project, particular interest in TOURBOT was evident. A few
interviewees responded positively when asked if they would purchase TOURBOT for
their museum, whereas the majority declared interest in it, postponing a final response
after the end of the project when its results will become more visible.
Although the validity of these responses as statistical indicators is questionable, mostly
due to the limited size of the sample, a qualitative result can be obtained regarding direct
and indirect market interest in TOURBOT. Evidently, the latter (indirect interest –
declare interest in purchasing TOURBOT after the end of the project) is considerably
larger than the former (direct interest – interest in purchasing TOURBOT at the current
stage of the project). The projection of the statistics to the total figures (for what it is
worth because of the very limited sample and the uncertainty concerning the final number
of organizations), reveals that the worldwide market that would be currently interested in
TOURBOT consists of a few tens of thousands (approx. 20,000 – 30,000) organizations.
If we assume that, given the constraining points analyzed in section 2, the directly
interested candidates with the budget required to invest in TOURBOT consist of a 10%
of the latter figure, the first line of potential customers would consist of approximately
2,000 – 3,000 museums and galleries. We would like to stress the fact that our
interpretation of this figure is not direct and quantitative but rather qualitative. It shows

It has been difficult to find out the number of public and private museums that exist in Europe and worldwide. The main
problem derives from the fact that no museum listing is complete. Some of them include also art galleries or other types of
collections (i.e. zoos, aquariums, electronic museums, e.t.c.).
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Market Analysis
Project Report
that a non-negligible market sector does exist, with a potential of economic exploitation
right after the completion of the TOURBOT project.
3
Competitive Analysis
This section will inevitably be short, since TOURBOT is a novel application, and no
direct competitive offerings exist in the market today. If we were to define competition,
this would probably exist in indirect channels and more specifically:
 Competition exists in a budgetary context, from other sources that fight for a share in
the museum’s overall budget. The positioning of TOURBOT with respect to this
issue would be a very well structured benefit analysis that would be able to show the
added value to the customer, and clearly identify all points of benefit. Also, the
increased attractiveness of the application could give it a higher rank in the priority
list in some cases.
 Another form of competition could be defined with respect to other existing ways of
promoting the museum’s activities, via the Internet or other media. In this sense,
many other high-tech offerings might constitute a competitive threat. Examples are
well-structured and contented internet pages, simpler navigation robotic avatars
without the web presence, CD-Roms, etc. It is our strong belief that the above do not
provide the benefits of TOURBOT, which effectively offers enhanced services and
provides the museum with a whole array of new possible uses and access options. It is
down to the marketing team of TOURBOT to put this differentiation across
effectively to the museum management.
4
SWOT Analysis
This analysis is preliminary, based on the information available at this time. A more
thorough SWOT analysis should be performed and is planned at pre-commercialization
stage.
4.1
Strengths
 Unique offering, no alternative in the market today.
 Very attractive solution uniquely combines many aspects of high technology.
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Market Analysis
Project Report
 Best use of existing museum resources (real museum space plus Internet based
collections).
 The solution has been developed combining a unique breadth of knowledge and
expertise, thus providing a substantial advantage in relation to possible new
competitors.
 The consortium includes three important partners from the museum sector, which will
act as references for TOURBOT’s marketing, as well as uniquely assist in developing
the application to fit the customer needs.
 Increase of access to cultural heritage worldwide and thus attract additional visitors,
sponsoring, publicity, advertisement, income, e.t.c. to the organizations that will
install the TOURBOT application.
4.2
Weaknesses
 The initial overall cost of the application, including customization and maintenance
costs, could be large for a number of organizations.
 The commercial TOURBOT operation will be a startup, with the associated
difficulties in financing, establishing a steady flow of orders, etc.
 The overall approach and reaction towards the introduction of robotic technology in
museums.
4.3
Opportunities
 The overall museum sector in Europe is growing on a yearly basis, as a result of
better quality of life, increased sensitivity to culture and heritage, and the proliferation
of information. The rate of growth is higher in developing countries.
 The Internet, with its immense global penetration as a communications,
entertainment, and training tool, facilitates a whole spectrum of new access methods
to museums and art galleries.
 The use of tele-presence is expected to grow immensely over the next few years.
Apart from the Internet, another enabling technology that reinforces widespread use
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Market Analysis
Project Report
of tele-presence is multimedia, which gets consistently cheaper and better. Thus,
users will utilize this technology to a good extent.
 The growing use of the Internet as a marketing and advertising tool will offer another
benefit to the museums when they to opt for the TOURBOT solution.
 Robotics is also gaining more and more attraction everyday. It is already considered
“in” to utilize robots in various promotional areas. This tendency might develop in a
“fad” in the very near future.
4.4
Threats
No major threats can be identified at this point. The threat of new entry is minimal, given
the large infrastructure and investment required. Direct competitor threat is at the
moment very limited, as well as threat from macro-economic factors. The only visible
threat is indirect competition, as highlighted in section 3 above.
5
5.1
Competitive Strategy
Added Value
The TOURBOT application will add value to customers in a number of ways:
 Increased actual attraction on site, due to the presence of the robot.
 Very strong Internet presence and solid marketing tool.
 Tele-presence will attract a large number of virtual visitors, on a frequent basis.
 Enhanced image of the museum and promotion.
 The strong web presence could additionally attract advertising and sponsoring.
5.2
Pricing
A simple analysis would break down pricing to the following parameters:
 Robotic platform
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Market Analysis
Project Report
 Software (system, navigation, user interface)
 Web server
 Customization (if required)
 Maintenance (optional)
The first three parameters constitute the base system. As a guideline, the overall price for
the base system should start at around 30,000-40,000 EURO. This price is expected to get
lower with volume of sales, and with increased penetration of TOURBOT in the market.
The target price is 10,000-15,000 EURO per system. These figures are considered
feasible, given current prices of commercial mobile robotic platforms and the market
standards in software.
5.3
Market Approach
In order to commercially exploit the TOURBOT application, the following alternatives
are currently considered:
 Formation of a joint venture by all the interested parties of the consortium.
 Licensing of the royalties of each participant to a specialized interested company or
consortium of companies and organizations in order to pursue market exploitation.
In both cases, the marketing plan for TOURBOT should utilize an approach formulated
by the key issues highlighted in the sections below.
5.4
Network of Partners
A strong network of partners in most European countries must be formed. Very careful
partner selection is a key issue, as the partners should meet a number of important
criteria. Their relationship with the local authorities and Ministries of Culture is very
important, as well as their ability to effectively market a high-tech solution to a
demanding and knowledgeable clientele. Therefore, partners should mainly consist of
high-end solution providers in the high-tech sector possessing appropriate experience
with customers from the cultural sector.
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Market Analysis
5.5
Project Report
Market Positioning
As mentioned before, initial potential customers could be sourced in the museums of
“Technology” and “Science” themes. These “buffs” will no doubt be most interested to
incorporate TOURBOT in their premises, and will be more receptive of the high initial
price tag as well. Other initial customers could be the very large museums that could
afford and easily attract sponsoring for this application. As the use of TOURBOT
proliferates, and its price is driven downwards, the customer base can more easily be
extended towards other types of museums as well.
5.6
Promotion and Marketing
Marketing and promotion of TOURBOT is crucial to its success. Fortunately, the three
museums participating in the consortium will be excellent reference points as first users.
TOURBOT should capitalize on these references by continuing the promotion of the
application in a number of ways such us:
 The distribution of attractive brochures.
 Promotional presence in sector-specific forums and magazines.
 Customized presentations to Ministries of Culture as well as key museums
 On-site visits, combined with short presentations using a notebook to connect to the
references’ web pages.
 Sponsorship of sector activities, such as mobile temporary exhibitions, etc.
On a general note, TOURBOT, like other novel and exciting applications, is not intended
to cover existing customer needs only. TOURBOT should go one or several steps ahead:
create a new need, and develop its market in such a way that the customers want to
incorporate it to enhance their image. TOURBOT fulfils the necessary specifications to
achieve these goals, by uniquely combining a breath of new and exciting technologies
with culture and heritage.
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Market Analysis
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Project Report
Conclusions
TOURBOT presents a novel and fascinating application. It is unique in its field, and
offers a number of quantitative and qualitative benefits to the museum and art gallery
world. It is being developed by a unique and solid combination of resources, which
creates a very strong competitive advantage against potential competition. The unique
combination of the Internet and robotics technology furnishes it with the potential to
develop into a marketing fad. It is down to the participating bodies to come up with and
fully utilize a winning strategy that will guarantee a strong market success.
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