A revolutionary sleep pod hotel in the heart of Gatwick airport.
Budget travellers continuously seek low cost and convenient solutions to their accommodation needs. This is a real challenge given the limited supply of well located, high specification budget accommodation.
Podtel Gatwick would be a 124 bed sleep pod hotel in a prime location on the land side of Gatwick Airport South Terminal, which should appeal strongly to the budget traveler. Designed by Jon Gray, founder of the successful sleep pod manufacturing company Podtime, the pods would offer a 24 hour service to travelers at Gatwick at very competitive prices – an average price of just £25 for an overnight, or £4 per hour during the day (for a minimum of 3 hours).
This is less than half the price charged by the nearest competitor at the airport, and also the perfect contingency accommodation in the event of delays or adverse weather.
To revolutionise the airport accommodation market. The lower price should attract those who are travelling on a budget, and who want to make their travelling experience easier and more relaxing. Guests can stay in the Podtel prior to catching an early flight, or after arriving on a late flight. They can also use the Podtel during the day, for rest or work, while waiting for a connecting flight or in the event of a delay.
Podtel Gatwick can keep its prices low because of the elegant and efficient design of the pods – they can stack two levels high to maximise the use of the available square footage, yet they remain comfortable, private and welcoming.
The spacious pods boast features such as double beds, high quality linen, ample luggage space, power points, privacy doors, internal lighting and Wi-Fi. Each pod would be refreshed and cleaned by on-site staff after use. There would also be wash-basins available to guests in separate cubicles.
A modern and user friendly online management/booking system would be built so that booking the Podtel is a quick and simple exercise. The accessibility of this service is designed to fall in line with the low cost budget airline model, as an affordable yet functional bolt-on to short or long haul journeys.
Gatwick Airport is enthusiastic and keen to see Podtel come to life as another unique offering to its passengers. Jon has been working closely with Gatwick over the last year to organise the lease for the space and the planning of the overall project.
Gatwick is the perfect international stage on which to introduce the concept, and after running Podtel Gatwick for a period of time, most likely a year, we would look to expand into other airports, both domestically and internationally.
After conducting passenger surveys at Gatwick we have discovered that 96% of passengers say that they would use the Podtel. The feedback from a sample size of 50 travellers was positive and extremely encouraging.
Jon established Podtime (www.podtime.co.uk) in 2011. He then teamed up with Paul Grindrod and after about a year of R&D the first pod product went on sale. Since then pods have been sold to a variety of clients, from corporate offices to pod hotels around the world. Some recognisable clients include Facebook, Nestle, GlaxoSmithKline, Roche and The Olympic Village.
Podtime have shipped pods to nine countries (The UK, the US, Canada, Russia, Japan, Switzerland, France, the UAE and Australia) and have distributors in America, Asia and Australia. One significant feature of the pods is their marketability. Podtime has been on BBC 2, ITV, Channel 4, Sky Sports News, and CNN. Podtime has also appeared as a feature in The Telegraph, The Guardian and the FT as well as many other international publications.
The objective is to now establish Podtel under a new limited company in which Podtime would have no interest. Jon will dedicate his full time and effort towards Podtel.
The current cash flow forecast is based around charging passengers an average price of £25 per night. For an overnight stay the opening prices are likely to be as follows:
Single bed = £22 / night (lead in price)
Double bed = £25 / night
Double Deluxe bed = £30 / night
And £4 per hour during the day for a minimum of three hours.
Each pod would be refreshed by cleaning staff with clean sheets after every use. We have a suitable linen company lined up for this with costing and laundry logistics incorporated into the plan.
We would also provide large wash basins for guests in separate cubicles, 8 male and 8 female, allowing further revenue streams such as hand towel rental (not currently included in the financial plan).
Podtel won’t offer snacks and drinks as there is a 24 hour Café Nero directly outside the Podtel which would be an excellent facility for our guests.
The people plan incorporates a manager, receptionist and cleaner for the early shift (6am – 2pm), and for the late shift (2pm – 10pm) and a receptionist for the overnight shift (10pm – 6am).
The occupancy figures have been factored in line with the fluctuations in passenger traffic throughout the year, and we have allowed for a gradual increase in occupancy up to the predicted levels over the first three months as the Podtel concept gains traction. Jon has also negotiated 6 months’ rent free period after opening as part of the heads of terms with Gatwick.
A further funding round is anticipated for expansion and this round will not dilute any investor shareholding. It is anticipated that the primary return on investment will be realised at the point at which the company is sold.
The majority of the funding will go into the setup of the Podtel, which includes some light infrastructure build, the build and installation of the pods themselves, advance rent payments, and the required fire safety systems as discussed with Gatwick.
Other spend is for the online management/booking system, pre-opening marketing costs, intellectual property, insurance and legal fees. Finally the remaining funds will help to bridge the timing of the cash flow during first few months. The timing of the capex payments has been carefully considered.
There is no personal guarantee on the lease since a lease deposit has been agreed that will be covered by the investment.
Last year there were 38M passengers passing through the airport, over 100,000 passengers per day, on average. The Gatwick passengers surveys conducted (of a sample size of 50 who were sleeping in the airport) reveal a high level breakdown as follows:
Age distribution:
10 to 20 = 6%
20 to 30 = 49%
30 to 40 = 21%
40 to 50 = 10%
50 + = 14%
Gender:
40% Male, 60% Female
It’s clear that the target market is weighted towards the younger traveller, however the service will be made to be suitable for all ages. The Podtel will be marketed with a premium feel so as not to discount any demographic, at a highly affordable price.
The target market will centre on those who might use a modern boutique hostel. The early adopters will most likely be of the younger, tech savvy generation who like to try out exciting new innovations like Podtel, along with the budget conscious.
Some choice comments from the Gatwick passenger surveys we carried out are as follows, in response to the question ‘Would you use the Podtel and why’:
‘Yes please, the idea is way long overdue.’
‘Yes, the current hotels are so expensive.’
‘Yes, I do this trip on a regular basis, a cheap overnight place to sleep would be very good.’
‘Yes, I missed my flight and have to wait here overnight.’
‘Yes, nearby the departure lounge and very economical.’
‘Yes, the £20 -£30 price range is highly competitive and a very compelling offering.’
‘Yes, I think this will work very well.’
The marketing strategy will begin three months prior to opening using a creative advertising agency who have experience of marketing accommodation within Gatwick. We intend to press release on the day of launch and it is anticipated that this should create a substantial round of international PR.
We are working with a company that provides media in Gatwick Airport to design appropriate advertising. We intend to establish directional signage throughout the airport with one or two sample pod units placed in both terminals of the airport so that walk in customers can see/try before they buy.
On-going marketing activity would involve working with Gatwick and other associated partners for promotional activity. Most importantly we would build the Podtel brand from the ground up as one of great reputation, excellent customer service and premium comfort.
From time to time we can vary the pricing structure in line with seasonal use as well as running engaging promotional campaigns.
Other competing hotels within the airport fall into two broad categories, the premium, charging a minimum of £150 per night, and the mid-range, charging a minimum of £60 per night. In contrast Podtel will fall under a third ‘budget’ segment, charging £25 per night – less than half the price of the nearest competitor at the airport.
Aside from the price, we would ensure success against our competitors by putting the customer first and generating an excellent reputation for customer service through hard work and dedication throughout the team.
We would rigorously and carefully select and nurture the Podtel staff as those with professionalism, passion and above all outstanding customer service. The staff would have the understanding that a large element of the brand building falls on their shoulders.