This case requires candidates to estimate demand for a disruptive technology by analyzing current airline passenger data and applying churn assumptions to different customer segments. The key insight is recognizing that first-class passengers have the highest willingness to switch (80% churn), creating disproportionate revenue impact despite smaller passenger volumes. Candidates must combine market sizing, financial analysis, and strategic thinking about competitive response.
The R&D team of Travel Wizard, a technology innovator, just announced that they have successfully invented a teleportation device which they plan to launch commercially next month. This device consists of a transmission room and a receiver room which can be placed at any distance and this one-of-a-kind device will be able transport a passenger between the two rooms within seconds.
Your client is the owner & CEO of SG Airlines, one of the biggest airlines in the world and she wants to know a few things: (1) How many customers should they expect to lose to Travel Wizard? (2) What will be their annual reduction in profit as a result?