The work performed during this reporting period (which is the totality of the project), concerns all six foreseen tasks:
Task1: Product-market analysis
To assess whether CORAL really meets the needs of the e-commerce market, we conducted a study in which several e-commerce owners, potential targets of our technology, were interviewed. Even though the solution offered by CORAL is language-agnostic, we conducted this study by focusing on the Spanish e-commerce market, since we understand that geographical proximity and language offers us an important advantage when contacting such e-commerce owners. These interviews had as consequence changes to the the revenue scheme, the technological core, and the long-term strategy of CORAL.
Task2: A/B testing for assessment of perceived quality.
Under project CORAL, human supervision, which is expensive because of its nature, is assigned to those strings that are more important for generating consumer confidence. This allows us to span a broad range between the cost incurred by when using pure machine translation (typically in the order of 0.2¢/word), and the cost incurred by when using human translators to translate all the texts present in the website (typically in the order of 10¢/word). By selecting those texts that are more important for the quality perceived by potential consumers, our goal is to allow e-commerce stores to establish their own mid-point in that range, hence adapting our service to the translation budget that the specific e-commerce avails of. This combination of machine translated texts and human translated texts, which we have named selective translation, constitutes the main technological hypothesis to be tested in project CORAL, namely, that selective translation and human translation will lead to approximately the same conversion potential. For assessing this, we conducted an A/B test in which a certain product was marketed using different translations, and the conversion results were measured. As a result, all conditions ended up being undistinguishable. Even though surprising, the results obtained in this A/B test present an interesting business opportunity. Given the fact that all three translation types seem to yield similar conversion rates, the assumption under CORAL is even more valid: e-commerces that wish to internationalise their business can choose to start off with a pure machine translation (with perhaps some tweaks in the most visible parts of the website), and then slowly transition to human-translated texts. This will allow e-commerce stores to enter new markets with a lower economic entry barrier, and decide whether to invest more in translations once ROI is being realised. Hence, and even though we did not expect raw machine translation to yield similar conversion rates as professional translation, we understand that the main technical assumption under project CORAL is validated, allowing e-commerce stores a lean approach to the website internationalisation problem.
Task3: Freedom to operate analysis
Since Sciling’s staff doesn’t include legal experts or experts in patent research, we decided to subcontract this task to Nordic Innovators, a research and innovation consultancy agency, after exploring other possible alternatives (such as “Pons Patentes y Firmas”, “SVMMA Asesores”, and “Econet Consultants”), ensuring the best value for money. After Nordic Innovator’s FTO report, and Olleros Abogados more intensive analysis of patent US20140200955, the conclusion is that there is no patent that would prevent Sciling from commercialising the service offered by CORAL, not even in the United States.
Task4: Assessment of the dissemination channels
During the duration of the project grant, the following dissemination channels were studied:
a) Direct mailing to e-store owners
b) Conferences and trade fairs
c) Reports in newsletters
d) Dissemination via channel approach (e-devs and marketplace solutions)
As a result from this analysis, a baseline customer acquisition cost of 500€ was established, which will be very useful for further exploring of dissemination channels.
Task5: Assessment of revenue streams
Upon design of project CORAL, revenue was planned to be generated by charging a commission on top of sales generated in the languages offered via the CORAL service. Even though many of the e-store owners interviewed would accept such commission, these interviews quickly revealed that it only makes sense whenever the specific e-commerce store already has a proven ability to reach the consumers. Generating revenue only by means of commission would put the economic viability of CORAL at risk, whenever the e-store being dealt with is not able to generate enough revenue and does not have a clear internationalisation strategy. As an alternative, we asked the e-store owners how much they would be ready to pay for such a service, and a monthly fee of 100€ arose as an average consensus.
Task6: Economic viability
The economic viability analysis was conducted in collaboration with Valencia’s CEEI (Centro Europeo de Empresas Innovadoras - European Centre for Innovative Enterprises), a European-wide network of enterprise centres devoted to supporting and developing new innovation-based SMEs. This economic viability analysis was conducted in the form of a business plan, and revealed that project CORAL is economically viable and profitable.
