Slovenian Entrepreneurs Cover Istria with a Ticketing Cloud

On Tuesday, May 15, the Finance newspaper published an article by journalist Janja Simonic titled "Slovenian Entrepreneurs Cover Istria with a Ticketing Cloud." The article covers the involvement of Programski atelje A&Z d.o.o. in the Istra Inspirit project, led by the Istrian Development Tourism Agency (IRTA) under the auspices of Istrian County.

How did you obtain the contract for the Istra Inspirit project?

To answer that, I need to go back a few years. In 2004, the city of Rijeka selected Programski atelje A&Z as a partner in the e-Munis project through an international tender. Through this project, the city was introducing advanced electronic public services for its citizens, and one of those was designated as a unified city ticketing system. We built it on the DRAGON Venue information platform, which is our own proprietary development. The Rijeka city ticketing system, if I may use that somewhat archaic term, remains after many years the only system of such scope in Croatia and the wider region, and a model of an effective solution that takes a modern and comprehensive approach to event promotion, marketing, and ticket sales. The e-Munis project attracted considerable attention from Croatian media, and through their coverage, our company was presented as a potential partner for Croatian local communities facing similar challenges. When Istrian County was looking for a competent partner for comprehensive information support for marketing and selling experiences under the Istra Inspirit brand, this did not go unnoticed, and I can say that, among other things, the Rijeka reference was probably the decisive factor that tipped the client's choice in our favour.

What is the project worth and where does the funding come from?

The value of the initial project, which began this year and will be completed in June 2013, is just over 100,000 EUR, and it is fully financed by Istrian County. But the pilot project is only the first step in implementing a new regional tourism strategy aimed at positioning Croatian Istria on the world tourism map as a region of experiences. In pursuing this goal, Istrian County has brought in the best human resources, led and coordinated by Dr. Manuela Hrvatin, and following Croatia's full EU membership, approximately 1.5 million in non-refundable EU funds are planned for subsequent development stages of the Istra Inspirit project. Additionally, opportunities are opening up for cross-border cooperation projects (so-called "cross-borders"). Ideas and plans for connecting tourism stakeholders in the Istrian region with stakeholders from the Slovenian Karst (e.g., Postojna Cave, Lipica Stud Farm, and others) are already maturing, and I hope that decision-makers on both sides of the border will understand the challenges of the times and recognise the unique opportunity before us. I am optimistic about this.

Where and how did you identify your business opportunity?

The Istra Inspirit concept is a genuine small revolution in tourism, as it sweeps away many entrenched stereotypes in content, promotion, and marketing. I could even say that this concept changes the paradigm of tourism product marketing. Our role in this project is multi-layered. Besides supplying and implementing the multi-functional and multi-channel DRAGON Venue information platform, which is the fundamental working tool for promoters, marketers, and sales teams, we simultaneously provide consulting, specialist knowledge, experience, and international best practices (know-how) in the field of comprehensive Event Management. By transferring knowledge into the Istrian environment and laying the foundations of regional cloud-based ticketing (Software As A Service) for all of Istria, we are building on the experience of Rijeka's city ticketing, and it is very likely that the ticketing cloud will expand from Istria to other Croatian regions in the coming years, where tourism is an important or even key economic sector. In all likelihood, the Croatian market will offer us several more challenges and opportunities in the coming years to demonstrate the quality and usefulness of our knowledge and the effectiveness of the DRAGON Venue systemic information platform.

How much will you earn from this project?

We began changing and adapting our business models over a decade ago, and for many years now we have been selling services rather than software. Apart from the initial implementation costs of the DRAGON Venue information platform, which the client will pay, our main revenue in the Istra Inspirit project depends on target audience interest and the success of ticket sales for events. The initial project in this tourist season will present 27 experiences at nine historical locations to target audiences. With each event limited to 200 visitors and a uniform ticket price of around 30 EUR, ticket sales will generate approximately 150,000 EUR in turnover. Under the current contract, a percentage of this turnover goes to our company. For 2013, an expansion of the experiential content offering and the number of events is already planned, starting in the spring months and running through late autumn. Although forecasts are thankless, especially in such turbulent circumstances as we are witnessing now, certain indicators fill me with optimism, and I project that the Istrian ticketing cloud will generate over 500,000 EUR in ticket sales turnover in 2013, while the total potential of Croatian Istria in this specific segment I estimate at several tens of millions of EUR annually, based on current knowledge and data. The business interest is obvious.

What are your business goals for 2012 and 2013?

When we talk about the Croatian market, this year we will focus primarily on the project in Istria, upgrading and modernising the system in Rijeka, and implementing an automated spectator access control system at the football stadium in Pula. The year 2013 will be most marked by the second phase of the Istra Inspirit project and the expansion of the DRAGON Venue platform user base to include operators of cultural, museum, sports, and similar activities. We will also seek opportunities for a smaller-scale cross-border pilot project through which we could test various business models and gain the necessary experience for larger projects in the coming years. Of course, we will continue developing software with undiminished intensity and seek opportunities to expand into new markets. We plan to have the DRAGON Venue platform present in at least ten markets by 2015.

What about plans for the near future?

We certainly want to continue co-shaping development trends and remain at the top of the global electronic ticketing industry. To make this happen, we will maintain a high pace of development, and already in autumn 2012 we will offer users in Slovenia innovative promotional, marketing, and sales tools that will enable direct and personal electronic communication with each individual visitor, as well as maintaining and nurturing e-contacts, all with the goal of greater visitor satisfaction and better sales results. We will also continue to seek opportunities to replicate the deal from a few years ago, when we sold intellectual property rights for DRAGON Venue to the largest private IT company in the United Kingdom, together with an appropriate set and scope of services. Since the British company needs quality consulting and ongoing expert support, the cooperation continues and its financial scope is also growing. There is another important aspect to this deal. Along with an internationally significant reference, the UK events market gives us the opportunity to draw on the most up-to-date organisational, marketing, and business knowledge in the event management field. We convert this knowledge through the development process into concrete software functions and solutions, which makes each new software version even more competitive on world markets, and some ideas and professional insights we also implement through the Mojekarte.si web portal. In line with the challenges and dynamics of our flagship DRAGON Venue development and our success in entering new markets, we will of course strengthen our human resources and maintain the competences of our development team and our user support and consulting team.

How is your business doing in Slovenia otherwise?

Taking all circumstances into account, we are satisfied with 2011. Among the developments in the domestic market, I think it is worth highlighting the successful entry of DRAGON Venue into the tourism sector. The usefulness, effectiveness, and flexibility of this working tool, along with international references and the team's competences, convinced the management of Postojna Cave, Ljubljana Castle, Lipica Stud Farm, and the Park of Military History in Pivka to adopt the platform. Together with Bled Castle and Skocjan Caves Park, virtually all the key entities that shape the Slovenian tourist attractions market are now among DRAGON Venue users. This opens up challenges and opportunities for connecting these tourism entities and creating extra added value that arises from the sale of more sophisticated tourism products. The DRAGON Venue platform remains open to all who recognise the opportunity to develop new products and services in cooperation with other stakeholders, open new marketing and sales channels, and make the most of the advantages of modern information and telecommunications technologies, especially the internet and mobile telephony.

What did you mean by that?

The professionals and policymakers in Istrian County have realised that things in tourism have been changing extremely fast in recent years, and that the existing concepts and principles of promoting, marketing, and selling tourism products simply no longer work. This realisation has triggered a renewal process through which a new concept is being shaped, one that highlights experiences as the primary motive for a tourist to visit a destination, and assigns the role of the fundamental promotional, marketing, and sales channel to interactive web services on modern portals, with special emphasis on the role and importance of direct, personal communication with visitors. It is difficult to briefly summarise the far-reaching consequences of introducing this new concept here, but fundamentally it brings: new markets, new target audiences, structural changes in the guest profile, a longer tourist season, and higher added value. Is that not exactly what everyone wants? Since I have been following the development of the Istra Inspirit concept from the creative idea phase, I am convinced that Slovenia offers many opportunities for similar stories that would be financially sustainable and self-financing within just a year or two. Perhaps it is time to look beyond our own navel-gazing, look around, and get to work -- rather than listening year after year to decision-makers telling us stories about Slovenia's lack of international recognition.

Please explain more about your solution.

The internet and electronic communications offer countless opportunities, eliminate the time, spatial, and other limitations of traditional business, and give free rein to the imagination and creativity of promoters and marketers. The modern tourist plans their journey in detail, and the decision-making process increasingly takes place on the basis of easily accessible, always available, clearly organised, attractively designed, and engagingly presented information. The medium that comes closest to these expectations is, of course, the internet. Is it even possible to offer a visitor from any part of the world greater convenience than being able to learn about the offering of a chosen destination in detail and in their most comfortable language from their home computer, to browse the offering and choose according to their own taste and preferences, to take advantage of early purchase benefits or last-minute deals or promotional or package offers, and finally to make a secure payment in complete privacy and print a voucher? And is there better, cheaper, and more effective promotion than when a guest who has purchased tickets in the online store for the Lighthouse of Love (one of the Istra Inspirit experiences) shares this news with their friends on Facebook or another network with a single click? Does that not sound like a discreet yet clearly expressed invitation to friends for a gathering in Savudrija, and is not a personal recommendation one of the key decision-making factors for visiting an attraction, show, or event? There is no doubt that for an ever-growing number of modern travellers this is the most attractive way, as the number of reservations and direct purchases made this way has been rising steeply year after year. But the story does not end with the first purchase, as that should be the beginning of an ongoing communication with the visitor via their email address. With respect to all the written and unwritten rules of email communication, an appropriate communication strategy, and attractively designed messages, many visitors will continue receiving updates about new offerings, interesting happenings at the destination, special or promotional deals, and the like for years, and will respond to them -- sometimes with purchases, sometimes by recommending the offering to their friends and acquaintances. The Istrian ticketing cloud will offer all the possibilities we have discussed, in a form and manner that ensures the best user experience.

How did you develop this solution?

As a joke, I could say the idea was born in the previous millennium, since the system has been in continuous development since 1990. I estimate that over all this time we have invested over 1,200 person-months in developing ticketing software, to use a project management unit. In the latest development cycle, which began in 2006 and through which the third generation of premium software under the DRAGON Venue brand is being created, we have invested around 2 million EUR. Despite the fact that our product competes with solutions from the biggest names in the electronic ticketing industry, development is no less intensive, as we want to continue staying at the top. 2011 was particularly dynamic, and I estimate we invested around 400,000 EUR in additional development and platform upgrades, which opened the door for us to enter the tourism sector. 2012 will be similar.

In your opinion, what is the secret of your success?

We simply never run out of innovative and boldly entrepreneurial ideas, or the courage, dedication, and commitment to make them happen. The excellent combination of qualities of the company's founders, who drive development, marketing, and user support, together with a well-chosen team of colleagues, form a group that sets high goals and achieves them. For breaking into the Croatian market, it was crucial that at that moment we had, alongside a working software solution that was at least a step or two ahead of its time and the competition, the necessary knowledge and experience. That is why it was able to fully satisfy and even exceed the expectations of our first client -- the Croatian National Theatre in Rijeka. Our successes in other markets also proved that the key factor was that from the very way we presented our product and concrete solutions and services, we stood apart from established stereotypes largely shaped by the competition, and we were able to listen better to customer needs and offer them something more.

What share of revenue do you generate in foreign markets?

Currently, besides Slovenia, we are present in the markets of the United Kingdom, Ireland, Croatia, Libya, Lebanon, and the United Arab Emirates. Outside Slovenia, we generated around 20% of turnover in 2011, and we plan for this share to grow in the coming years. Investments in development and entry into new sectors, especially tourism, should yield results as early as 2013. We plan to generate close to half a million EUR in turnover in foreign markets in the 2013-2014 period.

What advice do you have for other Slovenian companies?

Every entrepreneurial story is different, so advice is often a double-edged sword. But it may be useful for someone to hear that establishing a subsidiary company in Croatia was a business move in the right direction.

When did you establish the company?

Programski atelje A&Z d.o.o. was established in 1996, and today we sell our own solutions and services in European markets as well as outside the EU. The company offers its eleven employees a range of personal and professional challenges, while providing a creative and stimulating, yet also stable and secure working environment. Over a 15-year period, we have built a pedigree and international reputation, and we are building our future on the foundations of sustainable growth, stable operations, profitability, investment in development, timely recognition and understanding of market needs, creativity, innovation, and proprietary brands. I believe this is a combination that will continue to ensure our international competitiveness and bring us success in the future.

Ljubljana, May 2012