Introduction to the Company

UpGrad Product Management Competitor Analysis

Student Name: Shiva Prasad Lagula

Direct and Indirect Competitors of Meru cabs

Direct Competitors Indirect Competitors

Competitive Analysis of OLA and Meru CabsBackgrounds OLA Cabs Meru Cabs

Goals Major goals to bring is to:• convenience• price transparency• standardization to consumers booking car rentals and cab services. They offer instant confirmation for car rental bookings, either online or over the phone.

Major goals:• to provide world class taxi services in every city that it enters. • always try to be the hallmark for reliable• high quality service in every city that it operates in.

Mission A market place for all types of cabs and car rentals. Using the technology to bring the same efficiency and customer experience to the car rental industry that you expect from flights.

Meru’s mission is to be considered the first choice for land transport solutions in India. And provide urban commuters in India a world class travelling experience, by using technology that has evolved in developed countries.

Strategies Some of the major strategies of OLA are :• Only App service• Partnership with private taxi owners• Variable benefits for drivers of OLA.• Works with leading financial, that provide loans to help drivers.• Offers training to ensure drivers are delivered quality service with different

car segment of car models.

Some of the major strategies of Meru are:• One touch booking• Location tracking through GPS & customer support• Tie-up with banks for payments• Expanding rural areas to more cities in India• Car rental services• Safety and protection measures for travelers.

Current Employees Estimated number of employees are 5,000 till 2015 Estimated number of employees in between 500-1001

Funding $1.3 billion , investors are The Vanguard Group $75 million, investors are Brand Capital, India value fund

Revenue Details Estimated revenue $63.8 million Estimated revenue $27 million

Founder Profiles It was founded on 3 December 2010 by Bhavish Aggarwal (currently CEO) and Ankit Bhati. As of 2014, the company had expanded to a network of more than 200,000 cars across 100 cities.

Meru cabs was founded by Neeraj Gupta in Mumbai on April 2007, by raising funds against an equity stake in the company from India Value Fund (IVF), which is a private equity fund with a corpus of over US$1.4 Billion

Business models of OLA and Meru CabsBusiness Models OLA Cabs Meru Cabs

The cities in which they operate Ola's offerings on its platform ranges from affordable AC cabs on the Ola Micro range to the superior luxury offering from Ola Lux as well as localized offerings like the ubiquitous Auto-rickshaws to Shuttle buses for daily commute. Using the Ola mobile app, users across 102 cities can conveniently book from over 450,000 vehicles available to them.

Headquartered in Mumbai, Meru Cabs is now present across 24 cities in the country, offering 5 different types of products, each tailored to specific consumer requirements. A fleet of more than 20,000+ cabs and a consumer base of 5 Million make us the largest radio cab company in India. Through world-class technology, certified chauffeurs and able fleet engineers, it aims to provide the Indian consumers a unique travel experience across the country.

The target market in which they operate

Ola cabs is targeting three sectors of market that is providing services to customers for outstation, city taxi and local rentals. These services are offered by making variation in fleet those are luxury, sedan, hatchback and Ola mini.

Meru Cabs., which currently operates on a pure B2C model i.e. directly dealing with the end consumer, now plans to cater directly to the corporate segment through strategic tie-ups. It has already started a test corporate travel program in New Delhi, where it has tied up with three corporate companies.

The revenue model Runs on a pay-for-performance model. OLA charges a commission in whatever sales they make. Also to get access to technology platform.. OLA Charge taxi owners a small fee.

Revenue from the cabs: The drivers need to pay the company, approximately Rs. 1200 every day. So for each car on the road, it is Rs 1200 per day. Advertisements on and within the car: This is the another source of revenue. The cars have advertisement inside the car in the form of pamphlets and painted on the doors as well.

The shifts in the business model had to make in the past, and the

reasons for doing so

The business model works on a very simple concept. OLA cabs acts as a facilitator in providing cab-booking services to customers through multiple channels. Customers can book their cabs through the website, call center or the popular app. OLA does not OWN any of the cabs. Only those drivers with valid permits duly authorized and verified by transport authorities can sign up with OLA and they could be either self-employed or work for an operator who owns multiple cars.

Just like how we use an OLA App, the drivers get access to a driver mobile app on their Smartphone once they register with OLA. This is done only after a thorough check of authenticity and conducting due diligence of commercial papers and personal papers of driver and operator. The drivers have a flexibility to decide their own time to login to OLA Application and accept requests for rides from customers. They may choose to remain logged out of the system as per their convenience.

The source of revenue for OLA is the commission for each drive and the costs they incur are also quiet low as they majorly have to invest only on the technology. From when they started in 2010, the sales have doubled month on month and the graph is a super upward trend and may you not be surprised to note that during the year 2014, the revenues grew more than 10 times over past year.

Business model of Meru are :• Driver deposits Rs.10000.• MERU buys the car and gives it to the driver. The driver is not an employee of

MERU• MERU trains the drivers on soft skills. Basic qualifications for the driver is a

minimum of three years of experience on the city roads and with a basic knowledge of reading addresses in English.

• The fuel cost has to be borne by the driver• The maintenance of the car is taken care by MERU• MERU helps the drivers by providing the booking to drivers through their call

centers.• The driver is free to take passengers if he doesn’t get calls from the call center• The driver is assigned a ride from the call center by tracking his presence through

the GPS navigation system and hence he can NOT ignore the call center's trip assignment.

• In return the driver provides Rs. 600-950 per day to MERU (how much exactly?)Note, it is a per day charge and not a per call charge, which is means that even if the driver does not get a call from MERU on a particular day he has to pay Rs.650-900 as “rent” for using the car.

• Whatever the driver earns above these 600-950 rupees is his own income.

Strength & Weakness of OLA and Meru CabsStrength/Weakness OLA Cabs Meru Cabs

Strengths • First mover advantage as a taxi aggregator in India• Acquisition of Taxi For Sure made it No. 1 in India• High awareness due to aggressive TV, online and print media marketing• Huge customer base & due to network effect it is increasing • Rapid expansion and online application • Multiple rounds of VC investments have made the brand financially strong• Top of the mind service

• First mover advantage as a radio taxi operator• High awareness as a taxi operator• Presence across many cities across India• Trained drivers with good condition of cars with safety of prime importance,

who are taught at the Meru training academy• Meru Cabs was one of the first companies to launch metered "Radio cabs• Available 24x7 with e-bill services for the customers• Serves over 2 million customers and has been recognized with several

awards

Weakness • Drivers are the face of the company and hence their misbehavior directly affects the brand image

• While the demand is huge, amount of cash burning is huge and monetization is very difficult

• As per their business model, it owns taxis and hence fixed investment is high• Sudden surge in competition means limited margins and lower market share

Opportunities/Threats Opportunities:• Unorganized market is huge (~90%) and hence potential is high• Increasing internet penetration & smart phone users • Rising disposable income • Shifting of consumers towards convenience creates huge demand • Acquisition of smaller players Threats :• Rising competition• Good Funding• Presence of many national players • Absence of clear government regulations in developing countries • Future is unclear due to lack of regulations and Customer loyalty is less in this

industry

Opportunities:• Unorganized market is huge (~90%) and hence potential is high• Increasing internet penetration & smart phone users • Rising disposable income • Shifting of consumers towards convenience creates huge demand • Acquisition of smaller players Threats :• Rising competition• Good Funding• Presence of many national players • Absence of clear government regulations in developing countries • Future is unclear due to lack of regulations and Customer loyalty is less in this

industry

What are the pain points faced by the customers while using

their service.

- Can’t book easily on outstation Ola cabs.- Poor Quality and service comparing to Uber- Charges higher than other competitors - On cancellation of ride, is been charged.- No proper refund policy.- No proper customer care or support.- No Time sense. Should be more disciplined on time.- Drivers misbehavior

- Most of the rides will be Airport drop and pick ups, We don’t see point A to point B pickup with in cities.

- Poor and less efficiency apps, comparing to other competitors apps.- Unreliable services- Driver never turned up on time- No proper GPS tracking system- Charges more than other competitors cabs in the cities.- Can’t schedule a ride from different location to the family or friends.

App Details & Performances of OLA and Meru CabsMobile App Details OLA Cabs Meru Cabs

How many app downloads do they have (across all OS

platforms)

Ola Cab app is on three OS platforms - iOS App store - Android App in play store - Windows Store. Based on Android app downloads there are in between 10,000,000 to 50,000,000

Meru cab app is on below platforms: - iOS App store - Android app in play store - Windows Store. - Blackberry worldBased on Android app downloads there are in between 1,000,000 to 5,000,000

What are the app ratings App ratings on Play store is 4.0App ratings on App store is 4+App ratings on windows store is 3.4

App ratings on Play store is 3.8App ratings on App store is 4+App ratings on windows store is 3.8

How is the user experience of the apps

- User can book a ride, through app only- Can book offline through SMS.- No proper GPS Navigation and usually drivers calls for address.- Faster than other competitors apps- Wait time is usually 10-20 minutes- Ola cab books the ride in less time- Good SOS safety button with GPS co-ordinates- Has many segments of car’s, including mini and pink for women.- More no.of car segments than other competitors cabs.

• User can book a ride, through any medium (Web, call, app and sms)• Booking or wait time is usually 35 minutes.• More expensive than ola and uber cabs• Preferred mainly for Airport pickup and drop.• Less safety and security features• Limited segments of cars availability• Can share and give feedback

How is the overall functionality of the apps

Ola is quite simply the Indian Uber and has quickly grown to serve 10 cities already. Modelled on the latter, Olacabs does not own its own fleet and partners with car rental services making their cars for hire available through the app. Like Uber, there are two fleet levels, sedan and mini, and even the referral credit is the same Rs 300!

Of course, the Indian company takes care of lack of penetration of credit cards in the country. You can recharge your account to keep 'Ola Money' in your account for frequent payments, or pay cash to the driver at the end of the trip. Also, my only gripe with Uber is taken care of as you can make a booking in advance as well

Meru Cabs is one of the most popular and earliest radio cabs service in India. The fleet service provides services in seven cities - Mumbai, Delhi NCR, Hyderabad, Bengaluru, Jaipur, Ahmedabad, and Chennai - with two fleet levels, Meru and Meru Plus.

Unlike Uber, the Meru Cabs app is only needed for booking the cab. Once the cab has been booked and you've contacted the driver, you don't need the app for the ride. Of course it's good to have to check out route details and share feedback, but it's not required. The meter is available in the car and you need to pay off the driver at the end of the trip.

Also, the app allows you book a cab for a trip right away (within 35 minutes) or in advance beyond 35 minutes for up to 3 days. You can also check out you booking history from within the app.

Future initiatives of OLA Cabs• The new feature, too, comes as part of Ola’s commitment to allocate $20 million for

safety initiatives over this year. • While the number masking feature will reduce the risk of any untoward experience

for passengers, driver-partners can save on their calling costs. • Ola will be able to closely monitor driver behavior and conversations, resulting in a

superior experience for users. • Apart from number masking, Ola platform offers features like live GPS tracking,

sharing of ride details, feedback and reporting during the ride as well as an in-app SOS button to ensure passenger safety.

• “As a technology platform, committed to bringing scalable and sustainable programmed to ensure that user safety and security is always above everything else”

• Ola’s ambitious plan to empower 50,000 women as driver entrepreneurs in the next three years