(Finance) – They are approximately 600 million in North America (United States and Canada) e 400 million in Europeto travelers who could be facilitated by the luggage storage service, creating the conditions for a significant market opportunity. Considering the average number of bags per tourist and the average price for storage, the potentially available market would in fact amount to 4.8 billion euros in North America and 3 billion in Europe. In Italy in particular, also thanks to the high volume of international tourists, the estimated potential value is equal to 400 million euros, approximately 15% of the European total. A service that has registered in recent years a notable growth in popularityhighlighted by the trend of online searches, increased by 60% compared to the pre-pandemic period. Among the factors behind this success, we highlight the spread of platforms operating in the short-term rental market: apartments and holiday homes do not always have the necessary space for storing luggage.
To make the point is Growth Capitala leading tech investment bank in the Venture Capital ecosystem, in Luggage Storage – Market Report 2023in which it photographs a market that can be segmented into two main categories of suppliers: traditional ones, such as physical warehouses at train stations, and digital providers, i.e. online platforms that allow travelers to book a storage space at commercial establishments strategically distributed in cities ( for example bars and restaurants), thus ensuring greater capillarity and a simpler and more flexible booking process.
“The luggage storage market is a clear example of how innovative digital solutions can simplify the movements of millions of people around the world, offering an effective and intuitive service”, he explains Lorenzo Triboli, Vice President of Growth Capital. “The strong interest, also demonstrated by the significant increase in online searches by travellers, creates the conditions for a particularly profitable market. In this context, some factors are crucial to emerge in the competitive arena: the sustainability of the customer acquisition process, taking into account both the efficiency of marketing and the contribution of the organic acquisition channel, and expansion of the network of commercial partners, which must be as widespread as possible across the territory, in addition to a competitive commercial offer that can also include additional premium services , such as for example the movement of baggage from the original storage point to the station or airport of departure”.
To date, among the main traditional suppliers of luggage storage stand out land railway stations, where travelers can take advantage of lockers or guarded storage spaces to temporarily leave their luggage while waiting to check in at the accommodation facility or in the time between check out and actual departure. Considering the 5 European cities preferred by tourists in 2022, the daily rent for a locker in the central station costs 10 euros in Venice and Amsterdam, followed by Rome (9.6 euros), Paris (9.5 euros) and Berlin (9 euros).
This luggage storage model features numerous limitations that discourage its use: poor capillarity and perception of service quality, absence of reliable information on the actual availability of storage space, impossibility to book and pay online in most cases. Problems that are solved by digital providers, which guarantee maximum territorial coverage through partnerships with commercial activities that have spaces to use for storing luggage. But above all, they completely digitize the experience: users can book in advance and pay via app often at cheaper rates, access the service 24 hours a day and take advantage of extra services such as the guarantee in case of lost or damaged luggage. Indirectly, digital providers also offer benefits to local commercial partners, who create a second source of income by exploiting unused spaces in their businesses and expand the customer base by welcoming tourists into their stores.
According to the Growth Capital report, the digital luggage storage solution is still relatively uncommon, with the American Bounce present in over 2,000 cities around the world with more than 10,000 commercial partners and a rate of 6.65 euros/day per bag , leading the ranking of the main digital players in the luggage storage market. In Europe the competitive landscape is more fragmented and it is the Italian Radical Storage, founded in 2016, that positions itself as the leader of the continent and second in the world. The company, which raised 2.5 million euros in a round led by Vertis SGR in January 2020, currently boasts 7,000 business partners spread across over 800 cities and more than 3 million bags held since day one.
In the The French player NannyBag then stands out as the top 5 in the worldwhich from 2016 to today has intermediated the custody of over 1 million bags and stands out for the lowest daily price per bag (6 euros). Following are Stasher which, based in London, has 3,600 “Stashpoints” with a rate of 6.98 euros in over 880 cities and 80 countries, and finally LuggageHero, a Danish company operating in 230 cities which boasts a collaboration network with 1,000 commercial partners and 600 thousand users. The price for the custody service (9.30 euros) is significantly above the average of the competitors (6.60 euros).