Major strategies for OLA’s success!
Owning a car in 2010 was still a dream for many but traveling was an inevitable part of life for which everyone was dependent on local taxi services. These taxi services used to control the market and nearly 85% of them belonged to the unorganized sector and the lack of facilities offered by these local taxi services and their dominating control over the taxi market created a demand for an organized sector in the taxi market, which was captured by OLA. The idea behind Ola came to Bhavish Aggarwal after he found himself stranded in the middle of the road on his way to Bandipur from Bangalore where he was looking for a taxi. Due to a bad experience of car rental situation, two IIT Mumbai graduates Bhavish Aggarwal and Ankit Bhati decided to mend the system of the car rental which became the basis of initiation for ola cabs. Ola started as Olatrip.com which was a small website venture that offered weekend trip packages. Ola-cabs or commonly known as Ola which started as an online cab aggregator in Mumbai, which rapidly expanded its business in other Metropolitan cities, and now the headquarter resides in Bangalore. By the year 2014, Ola had expanded its network which now comprised 200,000 cars across 85 cities, including all the metropolitan cities and other important cities.
OLA Market share
The current taxi services market in India is driven by two major players — ANI Technologies Private Limited (Ola Cabs) and Uber India Systems Private Limited (Uber India). In FY 2019, Ola Cabs accounted for a share of 72.44% of the total revenue generated by the online taxi services market whereas, Uber India held a share of ~21.01%. Other players in the market include Meru Mobility Tech Private Limited, Mega Cabs Private Limited, and together they accounted for ~6.55% market share. The transition from the radio signal-based tracking system to GPS and GPRS-based tracking system was introduced by ANI Technologies Private Limited (Ola).
The major strengths that helped OLA to outstand its competitors:
1. Ola was the first taxi aggregator service provider in the country.
2. The services (Security, comfort and economic) offered by Ola are well appreciated by the public
3. Digital marketing has helped to create awareness about the company.
4. Increase in customer base due to high authenticity and good user experience.
5. Financial collaboration has brought funding for expansion.
6. Collaboration with government authorities for medical help in a crisis.
OLA have the below mentioned business opportunities:
1. As Ola coordinates through the smartphone app, an increase in the number of smartphone users provides them with a great platform to increase their customer base.
2. Disposable income can be increased.
3. Convenient services create huge demand among customers.
4. In tier 2 and 3 cities, there is a lack of travel infrastructure by the government is less which has open doors for business expansion.
5. Collaboration with the healthcare sector.
Business model
Ola started as a taxi facilitator where cab bookings were done through various numerous channels like pre-bookings, booking through the site, call centers, and mobile applications. After reconsidering the methodology and analyzing the heavy adaptability and good response from application users they shifted booking of cab only through a mobile application. The source of income for OLA is based on the commission of each ride. OLA turned out to be a great innovator for transportation, which offers simple alternatives for travel (OLA mini, sedan, auto). OLA doesn’t own cars nor do they employ the drivers, they simply connect with the drivers through the application.
Promotional and marketing strategies of Ola for business growth
Ola did everything from attending the calls of the customer to providing a driving facility to the desired destination. This was done for being a market leader, for achieving the same below strategies were followed.
1 EMPOWERING THE DRIVERS: Ola helped the drivers in buying their cars at huge discounts and affordable repayment scheme by collaborating with leading car manufacturers.
2 OLA MINI: It was one of the successful marketing campaigns by OLA. The main feature here was the price which was equivalent to the auto price.
3 STRATEGIC PARTNERSHIP WITH MAKE MY TRIP: In the year 2013, Ola cabs did a partnership with making my trip. Under which the customers of making my trip gets rental car facility for pick up and drop at the desired destination. This helped in acquiring a large customer base as people became more aware of the brand.
4 TREATING CUSTOMER WITH CARE: Customer is the center of marketing. This was done for building customer loyalty. Ola made sure that customers are treated well and are given all the comforts, they started emphasizing more on customer complaints and providing timely resolution.
5 ADVERTISING PARTNERSHIP WITH TVF: Ola did a partnership with TVF (The viral Fever) which is an Indian online web series platform. Ola acquired customers through TVF customer base and vice-versa.
6 OLA BOATS DURING CHENNAI FLOODS: Ola launched its ferry service in the situation of crisis. This was developed to help stranded people reach home and also to deliver essential material including food, water, etc. This enhanced the social reach for ola.
7 ECONOMIC STRATEGY: Ola focuses on target marketing where fleets are segregated according to customers’ needs and affordability. Ola pink focuses on women’s safety and is introduced for women. People prefer it much because ola offers less price compared to its aggregators.
8 SOCIAL MEDIA: Ola used various marketing channels for brand promotion and awareness, from all the social marketing tool Ola preferred Facebook as the number of users is high. The campaign over Facebook which was termed as the #chaloniklo campaign was a huge success. It enabled users to download the app and it increased the popularity of Ola apps. After the campaign, the consumer acquisition rate increased rapidly.
Effect of COVID-19 on OLA.
OLA laid off 1,400 employees as its revenue take a hit amid the coronavirus lockdown. CEO Bhavish Agarwal mentioned that their revenue has dipped 95 percent in the last 2 months. Most importantly, this crisis has affected the livelihoods of millions of our drivers and their families across India and our international geographies.
Bhavish mentioned in a blog that they had hoped the crisis is short-lived and the impact would be temporary. However, he said, the Ola leadership team has taken significant salary cuts to keep tougher decisions at bay. He pointed out that people are preferring to work from home and air travel has also been limited to essential trips, resulting in long-drawn implications for the company.
How OLA is helping its drivers in crisis
· INR 20 crore relief fund for driver-partners
· Crowdsourcing platform ‘Drive the Driver’ for drivers across platforms
· Launched ‘Ola Sahyog’ an interest-free micro-credit program for its drivers
· Free masks and sanitizers for drivers-partners
· Issued mandatory safety guidelines for drivers and riders
· Lease commission rebates for driver-partners
· Medical support & covered income loss of up to Rs. 30,000 for infected driver-partners in India
· Up to 14 days of financial assistance for affected drivers in Australia
In may 2020, OLA was backed by Softbank and Uber, which has helped in resuming services in certain cities under green and orange zones. The deadly virus, which is resetting consumer behavior towards the usage and adoption of different services and pushing businesses to revise their growth strategies for the post COVID world, might challenge cab-booking businesses to address hygiene concerns of customers.
Ola is now live in over 100 cities in green and orange zones and has mandated some measures to be followed by the drivers I.e. to clean cabs before every ride, use of masks, and disinfectants. Non-AC rides to avoid recirculation of air, asking for cashless payments, etc.
OLA initially was a startup which constantly worked on their growth as well as enhancing customer relations, OLA experimented with many different business strategies and took every opportunity given to them. A very big part of their success was focused on user experience which helped them becoming a multibillion-dollar brand, similarly @EdifyAccelerators is a Management Consulting firm. They provide Management consulting, Business Consulting, Business Strategy and Growth for MSMEs, SEMs and Startups. They work on business enhancement keeping customer as the center and analyzing every business opportunity available and help in finding the best strategies for your business growth.
References
Neelima Saini
Done as an intern for Edify Accelerators @https://www.linkedin.com/in/edify-accelerators-498361194/