This is where we need to “bee” Nyenrode Business Consultancy Beekeeper This is where we need to “bee” Nyenrode Business Consultancy Bart van Campenhout Jassu Hermans Asiya Suleimanova Julie Wijmans

Mandate Warm welcome to the board of directors of Beekeeper Presenting a strategy and implementation to tackle the current challenges Beekeeper is dealing with

Agenda Case definition Analysis Alternatives Recommendation Implementation Financials and risks Conclusion

Case definition

Key question: Go broad or go deep? What is Beekeeper’s strategy towards sustainable growth?

Beekeeper’s critical challenges Low Employee motivation Low Customers retention, high acquisition Increasing internal complexity Unclear fit of strategy and product

Recommendation Go deep in the hospitality industry Tailor-made functionalities for hospitality clients High scalability Reducing Beekeeper’s internal complexity

analysis

SWOT Strengths In-house knowledge on hospitality industry First-mover advantage in non-desk hospitality industry Weaknesses Engineering team cannot handle all customer specific requests No established track record in any industry Low customer loyalty No earnings model Opportunities New market with high growth potential Increasing use of smartphones on the work floor Threats GDPR Competition will increase due to new entrants

Issues in the hospitality industry High absenteeism of employees Turnover rates Low productivity of employees High seasonality

Beekeeper’s current product Peer-to-peer messaging Group messaging functionalities Employee surveys Posts and notifications from managers towards employees

alternatives

Alternatives introduction Industry broadness Industry depth 1 2 3

1 2 3 Alternatives Go broad global and non-industry specific Go midway on Beekeeper’s three biggest industries Go deep specifically on the hotel industry

1 Go broad Focus on any customer and tailor product to their needs Not restrained by the ups and downs in cyclical industries Higher disruption resistance Unclear customer value proposition Increases internal complexity issues

2 Go midway Focus on current majority industries (retail, hospitality and manufacturing) Lessens seasonality Increases complexity More revenue sources and maintains majority customers Decreases dependence on one industry Low loyalty

3 Go deep on hospitality Reduces internal complexity Increases product market fit of specific product Dominant market position Big potential market Retail and manufacturing customers may leave Getting to know core market to increase efficiencies

Decision metrics Decision is based on the key issues Beekeeper is facing right now Low Employee motivation Low Customers retention, high acquisition Increasing internal complexity Unclear fit of strategy and product: Beekeeper’s DNA

Alternatives scorecard Broad Midway Deep Employee satisfaction Customer retention Internal complexity relief Fit with Beekeeper DNA

Recommendation

Alternative 3: GO DEEP IN HOSPITALITY INDUSTRY Introducing a Beehive app which is based on gamification features Hotel-feature specific which is tailored for the hotel chain Full-focus on hospitality industry

IMPLEMENTATION

Hospitality sales and product development focus Sales and product developments strategies should be focused on (mainstream) chains Scalable Rapid growth Broad applicable learnings 1st step Hotel industry Current level of experience High number of employees 2nd step Restaurant industry High overlap with hotel industry (hospitality) High volume of non desk employees High fluctuation of employees 3d Leisure Hospitality overlap Hotel industry Restaurant Leisure

How to become the best community building platform of the Hospitality industry starting with hotel sector.

How to become the best community building platform of the Hospitality industry starting with hotel sector. ‘’To really get to know your customer you have to be where you customer is and do things that do not scale’’ Founder of Airbnb

Creates an effective and strong community of non-desk employees Beehive app Goal: internal community building to decrease high absenteeism and low productivity By introducing new gamification based features incorporated in beehive app Internal public compliment system Efficiency tracking (miles walked/rooms cleaned/customers’ served) NPS score tracking per shift RAOK (random acts of kindness) score track Motivating healthy competition amongst shifts Creates an effective and strong community of non-desk employees

Subscription-based service Freemium model Gathers behavioral data and strengthens the product Features: Access to limited functionality Trial model One month free trial of a premium model Premium model Attracts paid customers Features: Access to all the features $1.70 per account monthly fee 5% discount on groups from 500 employees

Financials and risk

Financials NPV = +190k PBP = 6 years ( in M USD) 2019 2020 2021 2022 2023 Investment -1.500 -0.100 Revenues +0.210 +0.300 +0.400 +0.600 +0.800 Profits -1.290 +0.200 +0.500 NPV 0.180 0.260 0.390 0.650 Assumptions: 1.5m initial investment in app creation 100k investment per big hotel chain Average of 1500 users per hotel Monthly fee of 1,70$ per user NPV = +190k PBP = 6 years

Risks GDPR Focusing on one industry initially means a cut in revenue Reduces diversification

conclusion

This is where we need to “bee” KEY ISSUES Low Employee motivation Low Customers retention, high acquisition Increasing internal complexity Unclear fit of strategy and product SOLUTIONS A 3 step approach on tackling hospitality industry Start with hotels by introducing a beekeeper’s app with gamification features