Bike-taxi services, often seen as an off-shoot of the popular on-demand ride-hailing services, have received an exceptional response in many parts of the world where last mile connectivity still remains a major challenge. This was evident in the $1.17 billion funding raised by Mobility startups in India across 56 rounds in the first nine months of 2019. The two largest players, Ola and Uber acknowledge this shifting trend, where riders are turning to cheaper and quicker means of travel. As such, we can expect these companies to bank more on bike taxis to shore up the falling ride numbers in recent years.
In many developing and highly populated countries, people have been migrating from rural regions to urban cities that offer lucrative employment opportunities. Many of these opportunities lie in the transportation sector, which is dedicated to meet the demand for everyday services. But transportation from nodal points to the final destination remains a major challenge. Following are some of the ways in which Bike Taxis address this problem:
We’ve talked about the growing population of urban cities and one of its most notable consequences is traffic congestion on the roads. To beat the traffic, commuters in countries like Indonesia and Nigeria make use of bike-taxis, which proves to be a convenient and affordable means of travel. Since two-wheelers take less space on the road than cars, they don’t contribute to existing traffic congestion woes.
Bike Taxis or two-wheelers consume far less fuel than cars and as such, they’re an affordable way to travel. In India, it’s estimated that a bike taxi ride costs around Rs. 60-70, compared to a cab ride which costs Rs. 200 for the same distance. So for the cost & time-conscious rider, the bike-taxis make an obvious choice.
We know the bike-taxis’ effectiveness to zip through the busy, traffic-congested city roads but they are almost tailor-made for the rural stretches and narrow lanes, where the last mile connectivity always remains the biggest issue.
Most of the south-Asian countries form the base of the bike-taxi market. India is currently the world’s largest two-wheeler market with an estimated 2 crore plus vehicles sale in 2018, which translates into 60,000 two-wheelers every day. Bike taxis are the preferred mode of transport in these countries and the success of startups like Ola and Rapido is a clear indication of that fact.
In areas where there’s a lack of public transport, bike-taxi services help generate employment opportunities and support the livelihood of thousands of people. This eventually contributes to the growth of mobility and builds an inclusive mobility ecosystem.
Bike taxi businesses have been around for over a decade now. Initially concentrated mostly in Southeast Asia, they’re beginning to acquire new markets in India, Africa & even Latin America. Following is a list of the most notable bike-taxi businesses:
Bike taxi apps work much like their forerunners i.e. taxi booking apps. Everything is geared towards helping the rider get an affordable and convenient experience at the tap of a button using the mobile app. To make that possible following features are offered in a bike-taxi app.
Geolocation is the basis to operate all on-demand ride-booking services. It works exactly the same way in bike-taxi apps as it does in the taxi-booking apps. The riders turn on the GPS on their smartphones and enter their destination. The app finds the nearby drivers, after which the rider can book a ride.
Both the rider and driver should be allowed to share each other’s feedback. This is vital to maintain a safe platform, gather crucial user insights, and understand users’ pain points.
Ride details sharing is seen as a standard feature in all on-demand bike taxi apps. Using this feature, the riders can share their ride details with friends and family. The details are usually shared via many of the IM apps already installed on the user’s smartphone.
Along with cash payments, a bike-taxi app should offer online payment options using internet banking, debit/credit cards, or e-wallets. Since these payment methods transmit vast amounts of financial data, they should meet the PCI compliance guidelines.
For safety purposes, the rider should be able to view the basic information such as name, address, photo, driving license, and details of the motorbike. This proves useful to perform an identity-check, driving experience, and also to have some background information about the driver so as he/she doesn’t strike as an altogether total stranger at the start of the ride.
Thanks to the GPS technology, it’s now possible to get minute details about someone’s exact location, and based on the traffic conditions they’re in, how long it will take them to reach a certain point. This has been a highly popular feature in taxi-booking apps. Usually, riders require an estimated arrival time before booking a ride, so they can be sure of how long they’ll have to wait before their driver arrives. The ‘reach destination’ time proves useful to know beforehand, how long the ride would take to reach the destination. Since if the time estimate is unfavorable to the rider, he/she may decide against booking a ride.
Very similar to the estimated arrival time, riders like to know the approximate fare before booking a ride. The fare is usually calculated using a different set of algorithms that take a lot of factors such as locality, distance, timing into consideration. Prices can also go up during peak hours when there’s a sudden increase in demand for bike-taxis.
Ride match or verification acts as an additional safety check for both the rider and the driver before starting a ride. After booking a ride, both rider and driver receive an OTP on their apps. Once the driver reaches the rider’s location, both are required to verify the ride using that same OTP.
My ride feature is useful for drives to keep tabs on all their completed and upcoming rides. They can quickly browse through their past rides to gain insights about their earnings and ride experience. The upcoming rides menu can help them plan their schedule effectively.
To keep the rider updated about the whole process, bike-taxi apps send out real-time push notifications at every major event. Major ride notifications include booking confirmation, driver’s name, vehicle & estimated arrival update, driver’s actual arrival update, and ride completion update, and so on.
A dedicated FAQ section for most common queries related to the bike-taxi service is provided within the app. This answers most of the concerns/issues that users might have related to the service without the assistance of help & support staff. In case the users have to report something, they can be directed to a Report Issues screen to describe their concerns in detail and submit them for a review.
A successful bike-taxi business has the potential to churn out millions of every imaginable currency in the world. The business looks simple on the paper; it revolves around conveying passengers across different locations of their choice. It’s different from public transport since the pick-up and drop-off locations are selected by the rider. The choice factor is what makes this business model so popular among people.
Before starting a bike-taxi business, it’s vital to properly understand and research the industry. The great thing about a bike-taxi business is that it can generate sales effortlessly so long as the vehicles are well equipped to carry out their services. But this knowledge alone isn’t enough; it has to be backed by key insights for maximum output. Following are some of the ways in which you can give your bike-taxi business the perfect start to become successful:
Strength, Weakness, Opportunities, Threat (SWOT) analysis is a perfect way to kickstart your business planning.
When entering any market, you have to know the core strength that you will be counting on from time to time to tackle new challenges or establish your identity. In a bike-taxi market, it could be your innovative mindset or simply the location of your business.
It’s better to know from the outset what might be the drawback of your service. For most startups, effecting change remains the biggest challenge. For instance, in your area, people might be overly reluctant to switch to bike-taxis. Another weakness could be a lack of trust and confidence if you’re new to the scene. Whatever the challenge might be, look for innovative ways to find solutions and move to the next step.
You might have seen an idea blast its way to success in a foreign market. Now you’re confident that with little tweaks and adjustments it can be successfully applied in your target market. In a bike-taxi market, much like any other sphere of business, it’s better to act quickly before you lose the first-mover advantage to an unknown competitor.
It’s crucial to take stock of the unfavorable government policies, economic downturn, and the competitive business scenario. Threats are inherent in any business activity but that shouldn’t deter you from creating more opportunities for your success and popularity.
Understanding market trends is crucial to successfully launch your bike-taxi business. For instance, currently, we’re seeing the taxi industry grappling to regulate the ridesharing services. But sound business knowledge would suggest that’s a bad idea since more competition leads to deregulation.
The way prices are calculated is also quite important. At present riders input their current location and destination to receive a customized fare, which takes into account the profitability derived from long distances (discounted prices for longer trips).
Finally, it should be quite clear that people enjoy their smartphones and if you can’t offer them convenience, then you may well lose their goodwill. Uber is a perfect example of how to win customer trust through innovation, flawless execution, and rapid response.
Identifying who your target audience is and then proving the various benefits your service offerings would bring to them is vital to establish a successful business. You may find that in your target market, most families own cars; but your job would be to explain why cars may not always fulfill the mobility needs of every family member all at the same time. It may also be a good idea to distribute questionnaires to find out how many adults and teenagers with cars in their houses have actually boarded taxis in their lifetime to get from one place to another. Furthermore, it’s better to categorize the target audience across the following profiles:
Bike taxi apps have a huge potential in the on-demand mobility services, particularly in the densely populated regions around the world such as Asia and Africa. The fact that these countries already have enormous two-wheeler markets and a population highly attuned to the ways of traveling on such vehicles makes them ideal for business undertakings.
If you’re planning to launch a bike-taxi startup, FATbit experts can provide the necessary technical guidance and further help build a custom bike-taxi app for your business.
Disclaimer: The Blog has been created with consideration and care. We strive to ensure that all information is as complete, correct, comprehensible, accurate and up-to-date as possible. Despite our continuing efforts, we cannot guarantee that the information made available is complete, correct, accurate or up-to-date. We advise - the readers should not take decisions completely based on the information and views shared by FATbit on its blog, readers should do their own research to further assure themselves before taking any commercial decision. The 3rd party trademarks, logos and screenshots of the websites and mobile applications are property of their respective owners, we are not directly associated with most of them.