Milestone 2

Navigation

• Home
• Sitemap

This wiki

This page

Session 6, 26th October, 2006 - Milestone 2

Assessment of mechanisms to generate corporate support

What is the corporation’s past innovation record and practices?

TomTom is a relatively young enterprise that started in the early nineties, then under the name of Palmtop, to produce software for PDAs. In 1991 they produced applications ranging from dictionaries and personal finance products to games and route planers. The steady evolution of PDAs and smartphones allowed TomTom to developp more and more sophisticated applications which resulted in the first navigation software for PDAs in 1996. From then on, TomTom can be seen as the leader in personal navigation. They introduced several innovations in this market, most of them as a result of continuous development of their own products and the integration of already existing services from other technology sectors. By combining mobile phones and their personal navigation products they opened a market for delivering real-time information to their devices. This approach allowed them to inform its users about road accidents, tailbacks and heavy congestion earlier than any other source.

1991 - Palmtop starts to develop applications

1996 – Launch first navigation software for PDAs

1999 – Developed carrier grade location server technology with Ericsson to provide maps, routing and other location-based services (LBS) for mobile phones

2002 – Launch of first GPS-linked car navigation product for PDAs, the TomTom Navigator

2003 – Developed NavCore Software Architecture upon which all of the Company's navigation products are based.

2006 – Launched TomTom WORK and TomTom Mobilty Solutions

TomTom About
Innovation award
A history of innovation and category-defining products
investors.tomtom.com

What problems might arise in its support of the venture at various stages?

To guarantee the success of TomAd, we need advertisers. But it might be that there are no advertisers which are interested.
Gas stations represent a fundamental part of our venture idea. TomAd depends on the collaboration with the gas stations in order to update the navigation systems with new data (i.e. new advertisements) and to collect also user data. So, the problem could be that the gas station companies are not interested in a collaboration with us.
We have to convince the management of TomTom which can fail due to many reasons. Assuming that we have well done our work by writing a excellent business plan, there might still be some other issues such as:
- TomAd does not fit the strategy of the management.
- The management is not willing to dispense the necessary amount of money to implement TomAd.
There are many technical problems that could arise. The two most obvious problems are:
- Implement, support and maintenance of WiFi infrastructure at the gas stations.
- Data synchronization between user’s end device and the system (e.g. not frequently enough because costumer might refuel the car once per week).
The market might not accept the idea because the costumer is willing to pay more money to stay advertisement free.
Is it possible to control the content of the advertisements?

What benefits might accrue to it from the venture? (A strong strategic benefit may be desirable but is not essential)

The possibility to place advertisements on their systems allows TomTom to decrease the price of their navigation systems and therefore sell even more of their products or gain more revenue for every sold unit. With the new technology it will become possible to provide updates, software or maps, for the navigation device and in addition the already existing technology TomTom Map Share will be fed with faster updates than with the current approach where users have to upload informations about maps from their personal computer. The up-to-dateness of their system can be improved and generates a strong benefit for their customers and a strong point when trying to win new customers.

How will the idea be sold and to whom?

The idea will be sold in three times. First, we will need to convince the gas stations companies to collaborate with us. They are essential to the development of our WiFi infrastructure. In return, this partnership would bring them low cost or even free advertisements.

The second step is very important because the price of the product will be directly related to it. It consists in persuading different companies to buy advertisements. We offer them the opportunity to reach drivers and passengers like never before. The two common ways of making advertisement were by radio and by road panels. Now their advertisement can be a lot more effective by using sound and image. Also, the partnership of an important company in this project could help to reinforce it image. For example, it could help to provide an image of innovation supporter or security.

Finally, the idea must be sold to the customers. The advantages are clear. The TomAd will be cheaper than any other car navigation system. It will also offer new and unique features as the possibility of providing updates, software and maps for the navigation system. The TomTom Map Share will also be faster than ever.