Since Uber’s launch, there’s been many positive conversations around the ridesharing industry. The ridesharing market has continued to experience tremendous growth. This article takes a close look at the ridesharing industry and the key players. It also includes the emerging rideshare advertising vertical within the industry.
Ridesharing: A Disruptive Technology
Ridesharing is a transport model. It matches drivers and passengers at short notice for one-off shared rides. In this arrangement, passengers can request rides using smartphones with GPS. They can also use social networking technologies. This helps them connect with drivers closest to them. Ridesharing wasn’t designed to augment traditional automobile transportation. It was developed to provide a more convenient mobility alternative for expanding cities.
Major cities across the globe are becoming more congested and busier each day. Ridesharing becomes a better alternative to traditional public transportation options. It eases passengers’ lives. For example, individuals and small groups of people can request rides at the tap of a button. This eliminates the stress of waiting in a long line for public transport or driving in a rush hour traffic jam.
Ridesharing appeals to metropolitan-area adults traveling alone or in small groups. It’s a great option for elderly users too. It gives them some sense of freedom. They can use ridesharing instead of depending on their families or caregivers. Now, they can go to doctor’s appointments, run errands or visit friends with a click of a button.
People in urban areas consider ride-sharing to be a cheaper form of transportation. It is cost-effective when compared to using a taxi. But why? Ridesharing companies do not fall under regulatory and licensing requirements. Traditional taxi operators have to adhere to these regulations and requirements. Also, rising vehicle and fuel prices is another factor that makes ridesharing attractive.
Who Are The Key Players In The Ride-sharing Industry?
Over the past few years, many ridesharing companies have emerged. The journey started with Uber and shortly after, Lyft. These two companies and others have revolutionized more than how people travel. They’ve also changed how people live and work. They all share the mission to reduce the hassles in traditional public transport. But, each of them selects a relevant business model. This is usually according to their target demographic area.
Here’s a brief overview of the major key players in the ridesharing market:
Uber is the largest ridesharing service in the United States. The American company started out in 2009. It aims to solve the rising transportation problems in San Francisco, California. To achieve this, the company created an app. It enabled users to hire black cars for their personal use around the city. That’s the beginning of the multibillion dollar ridesharing company. Now, it’s disrupting the transport space.
Overtime, Uber has refined its core services within the ridesharing space. Users can request a ride in a supported city with a few clicks on their smartphone or tablet. Riders have an array of options to choose from, depending on their needs and the size of their wallet. For example, you can get a cheap ride from UberX. Another cheap option is Uber Pool. This allows two or more riders to ride together and share the fare among themselves.
Meanwhile, more exclusive options are available for riders that want greater comfort. For such riders, they can go for Uber Select, Uber Black or Uber Lux. The fancy Uber SUV and Uber XL are also available for riders that need more room. Uber also enables you to request a much bigger vehicle when you opt for Uber Assist. This option provides more space and a trained driver.
Uber operates like traditional taxis. But, they’re different on the basis that Uber uses private vehicles. They’re also exempted from the regulatory framework applicable to taxis. As a result, they charge less compared to regular taxis. The company operates in more than 65 countries and over 600 cities worldwide. In the third quarter of 2019, it globally reached over 1.7 billion trips. The company’s total value of bookings worldwide has more than tripled since 2016. It reached 16.5 billion USD in the third quarter of 2019. Uber controls more than 65% of the ride-sharing market share.
Lyft is the second biggest ridesharing company in the United States. Unlike Uber, its brand recognition doesn’t spread beyond the North American market. Still, the company has recorded impressive growth since it launched in 2012. Lyft currently operates in more than 300 U.S. cities. These include San Francisco, New York and Los Angeles. It offers more than 1 million rides daily.
Like Uber, Lyft offers its users a wide-range of mobility options. You can request a regular Lyft ride that takes you straight to your destination. This service comes at a relatively low cost. You can share your ride with friends, family or colleagues using Lyft Shared. Another is Lyft Pool, this is an option that allows you to ride with other Lyft riders. With this option, you share the fare among yourselves. The company also provides you with a more exclusive option where you can drive around in style. You can enjoy this offering by opting for Lyft Lux.
Lyft incorporates other means of transportation for your convenience. You can choose to ride on bikes and scooters. The platform also offers a service called Lyft Transit. This option lets you know schedules for public transport close to you. This includes schedules for trains, buses and ferries.
Lyft’s audience isn’t limited to only individuals or small groups of people. Lyft has special offers for businesses via its platform known as Lyft Business. Lyft Business is a transportation management platform. It enables businesses to take care of the transportation needs of their staff. This platform enables you to manage your staff’s access to rides through a central portal. It also provides important analytics on how much you’re spending on transportation.
Gett is another key player in the ridesharing industry with a fair market share. The company used to be known as GetTaxi. Gett is an Israeli on-demand transport company that focuses on corporate ground mobility. Gett is a great option for users that are looking to get the following services:
- On-demand ride-hailing
This ridesharing company adopts GPS technology to connect users with drivers. In this way, it is like Uber and Lyft. Users can order rides through the Gett website or the Gett app. Gett has more reasonable pricing than other ride-share companies. It maintains stable pricing, whether you’re requesting a ride in peak periods when demand kicks in or not. This is unlike Uber.
Gett is competing well with the likes of Uber and Lyft. But, Gett still has low brand recognition in the U.S. for now. It has a strategy to gain a strong foothold in the U.S. rideshare market. The company recently acquired Juno, a growing rideshare company in New York. Gett is trailing behind Uber in the United States. But, statistics show that Gett is available in more U.K. cities than Uber is. The ridesharing company currently has a presence in more than 120 cities worldwide.
The company is committed to protecting users’ privacy and data. This reflects in the number of security certifications it has to its name. For example, Gett is ISO 27001-certified. This is a security certification for Information Technology and Management Systems (ITMS). It’s also GDPR compliant. They’re also about to have cloud privacy encoded as ISO 27018. Communication between riders and drivers only occurs on the secured app.
Gett is attracting big investors. The company recently raised more than $800 million in total funding. This includes $300 million from Volkswagen Group. If well-utilized, these funds will significantly boost the market status of the company.
Wingz is another San Francisco-based ridesharing company. This company started out in 2011 as a domestic rideshare business. It offered rides to and from the airport. Overtime, it has evolved and now has a presence in about 30 cities in the United States.
Wingz enables riders to connect to drivers through the Wingz app or website. But there’s something unique about the company. It’s unlike other rideshare companies that connect a rider to a random driver close to them. Wingz allows riders to request specific drivers to take them to their destination. The app also enables them to collate a list of their favorite drivers for future bookings.
Wingz also enables users to book rides from 2 hours up to 1 year in advance. Incredible! Right? For a rider riding to and from the airport, they can input their flight details. This is to keep the driver updated on the status of the flight. Like Gett, Wingz operates a flat-rate policy anytime, anyday. The pricing doesn’t have to surge like Uber. As a result, a user only pays the estimated price of their rider after the ride has ended.
Other rideshare companies include Didi, Grab, and Ola.
The Rideshare Market
The last 8 years or so of ridesharing has been quite prosperous. From Uber to Lyft, the industry has continued to attract investors’ attention. They’re also gaining attention from the general public. Despite the opposition from traditional mobility companies, the industry has defied all odds. It has become one of the biggest markets that’s worth investing in.
If you are interested in knowing the factors that are driving the market, here’s a brief insight:
Technology is a game changer. It’s revolutionizing the choice of how people work, shop and socialize. This techno-revolution wave has caused a shift in how people perceive automobile travel. People are now seeking more convenient and more cost-effective means of transportation. They prefer a transport model that allows them to order ‘private’ vehicles with a few clicks. They’re tired of lining up in a long line at terminals, waiting for public transport.
Traditional ground mobility arrangement doesn’t fit into the future of urban transportation. Ridesharing is a better alternative and more people are realizing that. The more people who use ridesharing, the more evident the benefits become. Ridesharing eliminates the challenges that go with traditional taxis and cabs. This includes stress and parking. With ridesharing, passengers can save time and reduce the cost of transportation.
Research reveals that over 85% of U.S. rideshare users report convenience (not price) as the primary reason they use a provider like Uber or Lyft. Ridesharing provides users with the highest possible convenience. You can order a ride from the corner of your room whenever you need one. The ridesharing market thrives on customers’ positive sense of experience.
The ridesharing market is expanding fast, as positive perception from the public increases. Uber, for example, is available in 65 countries and over 600 cities worldwide. In 2018, the rideshare company recorded a global ridership of over 5.3 billion rides. With its monthly users averaging 95 million all over the world. It generated $11.3 billion in net revenue worldwide in 2018 and $3.8 billion only in the third quarter of 2019. Uber’s ridesharing platform is valued at $76 billion.
Worldwide, developing countries like India are prominent players. They’re boosting the demand for the ride-sharing market. Europe, North America, Africa and the Middle East are witnessing rapid infrastructure growths. This, in turn, is fueling expansion in the ride-sharing market. Parts of Asia and the Pacific region are anticipated to exhibit higher growth rates in the next 5 years.
The ridesharing industry has inspired innovation in the advertising space. Advertising agencies have seen huge prospects in ridesharing. They’re taking advantage of ridesharing to target passengers with relevant ads.
What is rideshare advertising?
Rideshare advertising is an advertising model. With this model rideshare vehicles are used for ad placement. Rideshare advertising agencies pay rideshare drivers to display ads to their passengers. There are two ad formats: in-car and on-car. In-car rideshare advertising uses the inside of rideshare vehicles. There, they show ads to riders. This is usually with the aid of a tablet. Tappin X and Play Octopus are examples of in-car rideshare advertising companies. On-car advertising uses formats like: car wrapping, stickers, and rooftop video screen. Vugo, Wrapify, and Carvertise operate this model.
Economic benefits of rideshare advertising
Everyone, drivers, rideshare advertising agencies and passengers, benefits from this advertising model. The driver provides the agency with a space to advertise products or services. In return, the drivers get paid for displaying ads to their passengers. Passengers receive relevant ads that may solve certain challenges they’re facing.
Driver’s pay is determined by how much riders or passers-by engage with the ads. Rideshare advertising companies use facial recognition technology to time and stamp the ad. This makes it easy for them to measure engagement with the ads. The number of hours the driver drives is another factor that determines their pay. For example, someone who drives for 25 hours or more weekly can earn up to $200 a month.
The ridesharing market can triple its current total market value in the next five years. That’s if the key providers are willing to do the right thing. Currently, the industry attracts a fixed audience: young adults living in metropolitan areas. But how do they reach the untapped market? Rideshare companies have to make their services more accessible to a broader population. This will encourage more people to use ridesharing in a wider range of circumstances.
Table Of Contents
Chapter 2 – Ridesharing: A Disruptive Technology
Chapter 4 – The Rideshare Market
Chapter 5 – Rideshare Advertising
Chapter 6 – Conclusion