How tech, new business models could change cab industry
MINNESOTA: Almost every generation goes through a technological revolution, where newer and more elegant solutions make routine ways of doing tasks completely obsolete or irrelevant, to an extent. Millennials are generally early adopters of new technologies, while older folks often follow on grudgingly, not keen to let go of the systems they are already comfortable with.
The pre-teen population of every generation generally adopts new technology almost instinctively, as it has no ‘mental baggage’ and considers new technologies to be the standard process of doing things. But time and tide, and now the steady march of technology, seem to wait for none.
The Fourth Industrial Revolution?
A report from the World Economic Forum (WEF) notes that the First Industrial Revolution used water and steam power to mechanise production. The second used electric power to create mass production. The third used electronics and information technology to automate production. Now, a Fourth Industrial Revolution is upon us, building on the third. This one is predicted to disrupt business models and decentralise our economies as we move from value-system-based on ownership to ones enabling access.
The belief is that personally owned assets, from cars to spare bedrooms, will be part of the ‘shared economy’, and will expand entrepreneurship and diversify revenue streams. We have already seen some of this in action. Cab aggregating services like Uber, Lyft, Ola, Didi, and Grab have changed the world of transportation.
But now, connected cars, autonomous vehicles, and flying cars seem to be where the next quantum leap lies. YourStory referred to industry reports and reached out to Uber India and Ola, an international player in the in-cab entertainment space, and a legacy advertising player in India for this story. Let us take a deep-dive into how the cab space is evolving.
Could short-distance cab rides be free in the near future?
Sharing a cab is good for the environment, and also helps cabbies and cab aggregators maximise earnings. Uber India recently announced a flat rate of Rs 29 for up to four kilometres of travel on their UberPool platform.
Ola too announced a similar offering for Ola Auto rides in December 2016, and recently announced plans priced between Rs 39 to Rs 50 for up to seven km in cities like Delhi, Bengaluru, and Mumbai, for a limited time.
Image credit: Ola Blog
While these prices are already quite low, James Bellefeuille, Founder of Vugo, believes that short-distance cab rides could in fact become free for end consumers in the near future. Headquartered in Minneapolis, Minnesota, Vugo is a cloud-based B2B mobility media platform that provides an in-cab content-play experience to passengers of rideshare platforms like Uber and Lyft in the US.
James was recently in India on a personal trip and spoke to YourStory over the phone about his journey and how he sees the cab space evolving in the US and emerging markets like India. In 2011, James was working at an ad agency during the day, and moonlighted as one of the first Uber drivers in Chicago. He would generally recommend restaurants and places to visit to his passengers, but didn’t see many of them paying much interest to his recommendations. Then, he tried a different approach. He began sharing brochures of places or menus from restaurants with his passengers, and found that a visual aid created more interest and impact.
He realised that there was a big market that could be tapped here, by providing riders with personalised recommendations and content. So, along with his co-founders, James launched Vugo in June of 2015, and now has over 10,000 drivers in the United States across multiple rideshare platforms like Uber and Lyft on their platform. Vugo team. James on the extreme right
‘Netflix and ride’?
Vugo works with brands to stream custom content on tablets that are fitted in cabs. They also share the revenue with cabbies, serving as an additional source of income to them. James said,
A typical Vugo advertisement is a 30 second-long video; it’s targeted using our datadriven TripIntent Technology, which ensures that ads are relevant and contextual to a passenger’s trip.