The future of the taxi industry – a view from the inside

Surviving in a tech heavy industry

Published on 09.06.2017, in Market news, Feature

 

What we now call the taxi industry has been around in some shape or form for the last 400 years. It started out as horse-drawn carriages for hire and is now a globe-spanning industry, including some of the biggest technology companies in the world.

At iCabbi, we are at the coalface of the taxi business. Working with over 400 taxi companies internationally, we understand that the challenge is not just coping with the business as it stands today, but preparing for the future.

As Co-Founder and Sales Director of iCabbi, I work with some of the most progressive taxi companies in the world – giving me a unique perspective on the state of the industry in 2017.

Survival of the fittest

The taxi companies that will survive the challenges of Uber and autonomous (driverless) cars are the ones that have adequately prepared for the future. The basics of the taxi industry are much the same now as they have been for generations: it’s just the mechanisms surrounding it that have changed.

At the end of the day, people just want to feel safe and comfortable. They want a car that is clean, a driver that is polite and professional – you’d be surprised at how often that one comes up, actually. People don’t mind paying for a service.

Embrace the change

As a part of my role as Sales Director, I spend my day dealing with taxi companies all over the world. And I can see that companies which are thriving in the current environment are the ones embracing change and making it work for them.

iCabbi provides the platform and the surrounding products that taxi companies and their customers use. By that I mean you can book on an app, website, or by telephone. All the other processes in a taxi business are driven by our system. So, if you work in accounts, then you are billing your customers with our system.

We had a company go live in the UK with us recently. Before they came to us, their automation level was 11 percent. After two days with iCabbi they went up to 42 percent automation. In real terms, let’s take the school run between 6.30am and 9.30am which would be a really busy time for them; after working with us for a while, they might be able to have one less person in to answer calls or make better use of this resource to grow the business.

That’s huge. If that’s replicated in the busy evening period too, then over five days you are making better use of the cost of a full salary. And that’s just the start of it.

Flexibility is crucial

Just as we’ve done as a business, I advise taxi clients to embrace a flexible approach to innovation. We’ve recently been spending more time in the area of business analytics – helping our clients to use the data they generate to help them identify patterns in terms of customer use, driver performance and much more.

The flexibility of iCabbi’s system lets us work with new technologies as they come on stream. We are actively getting involved and we are the best-placed platform for taxi companies to integrate and evolve with new developments, whether that be business intelligence or consolidation of companies, national apps or whatever else is coming down the line.

In terms of business analytics, we’ve signed a deal with Oracle and we’re developing a best-in-class solution with them. We want to enable our clients to work smarter and identify trends. For example, we may spot a growing trend of people taking a connecting taxi from a train station to a new business park – then that allows us to plan for that and communicate it to drivers.

Identifying inefficiency

The worst thing you can have in a taxi business is a driver driving around aimlessly, because they are losing money. The more effective you can make them the better.

Business analytics is not just a matter of tracking how customers are behaving. The key asset for any taxi company is its drivers, so you can gain insight into their performance too.

That’s things like seeing who is doing the most work – and also who is declining the most work or not showing up for the most work. You can reward drivers or bring them in for extra training. You can view customers’ patterns too. So if you have a regular customer that keeps using you and they suddenly stop, then you can send them out a voucher or reach out to them in some way.

The power of collective thinking – a national response

The next step for taxi companies to combat the threats to the industry seems to be partnering up and making themselves the first choice for customers no matter where they are.

In the UK, 10 of our clients have about 16,000 cars between them. And they’ve come together to build an app, called Riide, that they are plugging into the iCabbi system. If you are from Liverpool and your local taxi is Alpha Cars, then you can go down to Manchester or Leeds and book a taxi on the Riide app with one of their partners in the other city.

We have a similar group coming together in Canada and in the US, so we are seeing that there is strength in numbers. We have the technology to allow taxi companies to evolve, and that’s a great thing to see.

It’s crucial to keep on moving, however. I’m impressed by the current levels of innovation in the taxi industry as a whole, but now is not the time to rest on our laurels. It’s not a case that once the app is built, the problem will solve itself.

At the recent Automobile Barcelona conference, it was predicted that the number of cars would be up, number of apps down and that there will be a big increase in software as a service (SaaS) models by 2025 – another big shift in the landscape. This is why iCabbi is constantly boundary-scanning and looking ahead for our customers, so that we can deliver the best and most innovative solutions.

Even with the biggest clients we have, 40 percent of their bookings come from apps. You still have 60 percent or more coming in through the telephone system. People’s booking patterns are changing. The app might be the hot thing at the moment, but you don’t know where the next wave of future bookings could come from.

If you look at aggregators – which would be something like the Hotels.com model for taxis – you could have an app that selects all the companies in an area and you can book through that.

Or if you look at the Scandinavian market at the minute, there is a big push on ‘mobility as a service’ (MaaS) apps. They are multi-modal apps where you say I want to go from A to B. The app tells you the most efficient way to go is to walk down here, hop on a bus there, go three stops and then get a cab from there. So maybe people will be booking from completely different apps, but the taxi company doesn’t mind, as they are getting involved somewhere along the line.

Helping customers secure their futures

The best sales weapon we have is not in fact, our sales team, but our customers.

Our tagline here is that iCabbi will ‘transform your business’. That’s why our sales team don’t tell taxi companies about what we can do. Instead they tell them to talk to our existing companies and see how we’ve transformed their businesses.

It’s not only the businesses that iCabbi are transforming. In January of this year, I opened my inbox to an email from the owner of a taxi company which said, “I’ve been able to go out on New Year’s Eve for the first time in seven years because I trust your system.”

Now, I call that transformation.

Bob Nixon

Sales Director & Co Founder

Bob is the Head of Global Sales, and a co-founder of iCabbi. Bob gives a detailed look into 2016 and how 2017 looks for iCabbi and the industry.

iCabbi is the leading global innovator in cloud based dispatch systems, created with and for enterprise taxi partners to drive business growth.

The platform offers full visibility and control of business and is designed to reduce operational costs, increase efficiency through automation and drive customer satisfaction.

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