YourCabs generates more than 50% customers via online booking - What’s their story?
YourCabs is a Bangalore-based technology platform to aggregate fleet owners and vehicles, in the car rental space. Founded by Rajath Kedilaya in 2011, the company has managed to create an intelligent network that manages real-time supply and demand of cabs.
The evolution
We started out with a marketplace model where we directly listed vendors (fleet-owners) with their inventory. But that had to change, as very few vendors were ready to move into an electronic platform, and we also realised that since most vendors had very poor service or support, customers held us accountable for any booking.
We then shifted towards a variation of this model where we take ownership of the booking and then broadcast it to attached vendors or drivers, who could bid for it. We have provided web, mobile, and IVR-based interfaces for our partners to bid and manage a booking. This model allows us to handle both the short-tail (city taxi) and long-tail (outstation, luxury) in a single platform.
The motivation to solve this problem
Indian urban centres have been dependent on autos and personal vehicles for a few decades now, and there are no alternate options in last-mile travel for people who need a cleaner, safer, and efficient mode of transport. We believe in addressing this pain point with our model, by making cabs extremely accessible, in terms of both availability and price. We already see a reduction in the price-gap between an auto and a cab.
The number game
We do around 300 transactions a day in Bangalore, with a 10% mom growth. Since the cab space is hyper local, we are focusing on profitability rather than scale. We are currently profitable operationally and intend to be fully profitable in a few months. We have built in a lot of technology into analytics (heat maps, demand prediction etc.), early warning systems, and also have built a great booking interface. This helps us manage bookings and meet great service standards with a very lean team. Almost 50% of our bookings are done online and we have a repeat rate close to 70%.
We have around 150 vehicles in the vehicle aggregation model and over 1200 vehicles in the vendor aggregation model. Revenues are primarily through commissions.
Generating demand online
We’ve tried to get the basics right. We’ve invested time in SEO, getting some good content on the site and targeting ads. We’ve mostly done our marketing online too. We’re seeing a good traction from the segment of people we’re targeting (they haven't found a big difference in male:female ratio between phone or online bookings). We’ve invested in detecting fake online bookings early as well. If you ignore this aspect, the number of cancellations is in the 3% range for phone bookings and in the 1% range for online.
What does Uber’s entry mean?
The cab market is divided into low-cost (Indicas), premium (sedans, Innovas), and luxury. We believe the large target market in emerging countries to be low cost travel, while Uber worldwide concentrates on high-margin luxury cabs. Luxury local travel is a small market currently in India, but demand can be created with significant investment of money and time. We don't see our paths crossing anytime soon though!
Website: YourCabs