SWOT Analysis for a Weather-Optimized Travel App Startup

Description of the New Venture

The new venture being proposed is a company seeking to develop an app that will determine optimal weather days in different locations. The tool will draw on a massive dataset of historical weather data for all available geographies — beginning with the United States and the world's major tourist areas. The user will enter a location, a desired activity, and a span of time, and will receive as output the optimal days based on historical patterns.

The current landscape for someone planning a trip may include generic information — for instance, golfers are often told to visit Arizona in winter when temperatures are not extreme — but that guidance is frequently not granular enough. Someone thinking of visiting Bora Bora can easily find out when the rainy season falls, but more refined data might help them choose a specific week during shoulder season that is least likely to see rain. Organizers of outdoor events might also benefit from this application, as it enables people to identify the absolute sweet spots for climate where observable patterns exist. In many parts of the world, weather can be highly changeable, but a sweet spot of ideal conditions for a given activity can usually be identified. For example, someone wishing to go heli-skiing in British Columbia might want to find a weekend most likely to be both sunny and not excessively cold — an expensive activity for which maximizing the chances of perfect conditions is essential.

The product name has not yet been determined but will play on the perfect weather theme to effectively communicate what the app delivers. The team that builds the app can be fairly lean: front-end developer, back-end developer, UX/UI designer, a writer or graphic designer, and someone to handle the algorithm that will parse the data. The time to develop an app is approximately 18 weeks and requires at least the above-mentioned specialist roles, along with project management, product marketing, and a number of other roles that might bring greater expertise to the project (Haselmayr, 2013).

The ideal use case might involve someone looking at a broad spectrum of options — for example, a person with vacation time in the first week of October who wants to know where the weather is most likely to be perfect for hiking. The app might provide a dozen recommendations from locations around the world. The target market is essentially anyone planning a trip or an outdoor event of any type, including professional event planners and individuals organizing something as informal as a family reunion. There are ample articles and blogs about how to find perfect weather at any time of year, but most are backed only by basic statistics and anecdotal evidence rather than professional statistical analysis of a large-scale dataset (Taylor, 2016).

The product will generate revenue by partnering with travel applications. These partnerships are common in the industry: when users are referred to a major travel website, the company earns a share of whatever those users purchase. People using the app for vacation planning will be guided toward buying tickets, and the company will receive a percentage of those transactions. The venture also aims to develop stickiness attributes in order to build high target market participation, leveraging first mover advantage to create a barrier to entry.

SWOT Analysis

The following sections break down the venture's internal strengths and weaknesses alongside the external opportunities and threats it faces. This four-part framework provides an honest foundation for strategic decision-making at an early stage of development.

Strengths and Weaknesses

There are really only two strengths that the venture can claim at present. In a perfect world there would be more, but any startup business can only state with confidence what it has in terms of the idea itself and the internal team. The venture is built on what appears to be a blue ocean concept — one not currently available anywhere. While climate data is available for any single region, this level of detail is not generally available for the entire world, and is not generally translated into actionable recommendations by an algorithm developed by a professional statistician. Blue ocean businesses benefit from first mover advantage and can win substantial market share before competitors are even able to enter the space (Denning, 2017). So the idea itself is a major source of strength, and the team building it is another. The founding group believes it has the right blend of mathematics, engineering, and marketing to make the application a success.

There are several weaknesses, or potential weaknesses, that could prove costly. First, while the team is considered high quality, its members have never worked together before. Interpersonal issues that arise could theoretically challenge the success of the project. A second weakness is that the venture is being built on a shoestring budget, with key contributors being compensated in equity rather than salary. This means there is a limited window before the company must start earning money and paying people, and there are no reserves to cover unexpected expenses or additional hires.

A third potential weakness is that no product yet exists — only an idea. As such, there is no proof of concept, either that the application can be built as envisioned or that the target market actually exists in sufficient numbers. Research suggests the market is real, but the business model depends on persuading partner companies to work with the venture and on generating sufficient traffic and marketing data to benefit those partners.

Opportunities and Threats

There are several meaningful opportunities, which is the central motivation for building the app. Although the underlying weather data has been recorded over long stretches of time, it was never particularly easy to compile, and the artificial intelligence technology needed to parse this data on demand in an app context did not previously exist at scale. The venture is therefore leveraging emerging technologies to unlock the value of massive historical datasets on weather and climate. Consumer appetite for this type of personalized, data-driven information represents a genuine opportunity to the extent that the app can convert raw data into meaningful recommendations for the average user.

The competitive dynamics of the travel industry also create further opportunity. The primary revenue driver will be partnerships with major travel companies. The travel industry is enormous, rivalry between its major players is intense, and that rivalry creates opportunity for any party that can build a loyal, engaged audience.

There are also definite threats. The most significant is competition. Although the venture is aiming for a blue ocean position, there is probably little in the way of sustainable competitive advantage unless a large and loyal user base can be assembled quickly. Any potential competitor has access to the same datasets and could build an app that performs essentially the same function. This makes it strategically preferable to integrate deeply with travel partners rather than to allow those partners the opportunity to develop this functionality themselves, which would significantly reduce the venture's business prospects.

A second threat is the overall health of the travel industry, which is closely tied to the broader economy. Economic downturns can reduce overall demand for travel services or prompt consumers to opt for familiar, known travel choices rather than exploring new options. Either outcome could substantially reduce potential revenues.

A third threat comes from external actors such as regulators or cybercriminals. Hacking incidents carry direct costs in the form of lawsuits and remediation, but the damage to brand reputation is often far greater than the direct financial impact (Whitler & Farris, 2017).

References

Denning, S. (2017). Moving to blue ocean strategy: A five-step process to make the shift. Forbes. Retrieved April 21, 2019, from https://www.forbes.com/sites/stevedenning/2017/09/24/moving-to-blue-ocean-strategy-a-five-step-process-to-make-the-shift/

Haselmayr, M. (2013). How to build your first mobile app in 12 steps. Forbes. Retrieved April 21, 2019, from https://www.forbes.com/sites/allbusiness/2013/11/14/how-to-build-your-first-mobile-app-in-12-steps-part-2/

Taylor, P. (2016). 5 places where the weather is 75 degrees and sunny all year long. Forbes. Retrieved April 21, 2019, from https://www.forbes.com/sites/petertaylor/2016/10/31/winteriscoming-guess-where-the-weather-is-75-degrees-and-sunny-all-year-long/

Whitler, K., & Farris, P. (2017). The impact of cyberattacks on brand image: Why proactive marketing expertise is needed for managing data breaches. Journal of Advertising Research, 57(1), 3–9.