Virgin Blue. Upwardly Mobile?

Virgin Blue Check Mate Image

As a Velocity (Virgin Blue's frequent flyer program) member, I received a notification last week of a new service that Virgin Blue is offering - checking in with your mobile phone.

Checking in is selling it a little short.  From the email:

Hi Jason
Virgin Blue has launched a revolutionary, innovative new process to check-in and board on domestic flights via a traveller's mobile called "Check-Mate". You no longer have to rush to the airport and join the queues, or worry about leaving your on-line boarding pass on the printer, now everything is in your pocket.
Easy Check-in
The mobile app for Virgin Blue's Check-Mate system is the 1st in Australia which lets you check-in from anywhere, when travelling between Sydney, Melbourne and Brisbane. No need to be at your computer, your BlackBerry™ or 3G phone does it all.
Electronic Boarding Pass
With Virgin Blue Check-Mate you don't even need to print out your boarding pass. You'll get a 2D Bar code sent to your BlackBerry™ or 3G phone, which is scanned at the gate.
Book or change your flight
Virgin Blue Check-Mate also allows you to book and change your flight, at the touch of your screen on your BlackBerry™ or 3G phone.Why not give it a go now?Access on any 3G mobile at mobile.virginblue.com.au or download the app for Check-Mate from blackberry.com/appworld.
Happy flying,
The Velocity Team.

I think this is an exciting step for an airline to take.  It's actually an exciting step for mobile based commerce in general and is, as mentioned in their first line, a step towards eliminating the need for a computer for day to day items.

I'm surprised it's taken big business as long as it has (excluding maybe the banks).  As of 2008 Australia already had more mobile phones than people so it would seem strange not to be using mobile phones for business transactions.  Granted, I'm not sure how many of these are "Smart Phone" with the capability to use this service to it's full extent but that number is sure to grow.  This is squarely targetted at those that will take advantage of it though.  Affluent and upwardly mobile "Smart Phone" people.

It would be interesting to be a fly on the wall (or squeezed between the pages) of the business case for this one.  Maybe it went something like this:

Benefits

$XXX - More people booking because don't need a computer and can do on the fly (no puns allowed in a business case)

$XXX - Reduced boarding pass printing costs and associated maintenance of boarding pass printing machines

$XXX - Reduced airport queuing times due to customers not requiring to be in the terminal to check-in etc

$XXX - Reduced costs of customer service staff at airports

$XXX - Improve goodwill through convenience and eco benefits

Costs

$XXX - Mobile Website development

$XXX - Plugging it into the existing booking managment system

$XXX - Project Management

$XXX - Change management

$XXX - Training

Risk - None really*

* What's risky with mobile phone commerce?

As a bit of very basic reverse engineering I took a look at the possible savings just from reducing the printing costs.  According to the 2008 Virgin Blue annual report they carried about 16.7 million passengers.  All of those people would have required a boarding pass so that's roughly 16.7 million of those little colour boarding passes.  Let's assume each boarding pass print costs, all inclusive, 5c (paper, ink, maintenance, etc.).  That's $835k in boarding pass printing costs (Sounds low to me but let's go with it).  Given most of those passengers would be business passengers, it follows that a large proportion of those people use Smart Phones.  Let's stay conservative and assume 25% of passengers are Internet capable Smart Phone toting business or upwardly mobile types.  That's around a $200k saving in printing costs.  So, without the other potential benefits factored in or any of those fancy return calculations, you're looking at spending less than $200k to develop this service.  That's definitely achievable!  It's also based on a lot of assumptions and hot air but it gives an idea of the thought process they may have gone through.

In all seriousness though.  I think this is a great step towards improving the facilities for business transactions through mobile phones. The challenge as Smart Phone usage grows for business transactions will be catching the eye of your average Smart Phone using Joe and Jane on the street.