Are Ola, Meru grabbing UBER's lunch?

By Sohini Sen , afaqs!, Mumbai | In Advertising
Last updated : January 07, 2015
Ola Cabs has rolled out its first TVC to promote its app. Meru is incentivising the use of its app by offering a 30 per cent discount. A look at what UBER's peers are up to.

When US-based taxi hailing service UBER's Indian expedition was marred by an incident last month (a UBER driver allegedly raped a 27-year-old woman), what it also threw up was the increasing use of app-based services in the car and taxi rental industry in India.

Now, with UBER's future in the country being questioned, other service providers in the organised car rental industry are rushing to fill the gap that has opened up. Players have come up with offers and campaigns to push the use of apps for booking cabs and car rentals.

Competitor Ola Cabs has come up with a campaign to make people aware of its app-based service. In the TVCs, a magician and a hassled employee use Ola's 'lightning fast' taxi booking app to get out of sticky situations. Created by Happy Creative Services, the campaign focuses on the ease of booking through an app. It also highlights the fact that Ola Cabs can always be depended upon, however unexpected anyone's travel plans are. Incidentally, the ads were to have gone on air in December, but following the UBER incident, were kept on hold.

Sudarshan Gangrade


"Cabs in India have traditionally been booked for planned outings, like going for a meeting or a wedding. At Ola, we are trying to push it for day-to-day urban commute, because we have noticed that travelling, especially in big cities, is often unplanned and spontaneous. And radio cabs have to be booked in advance because commuters hardly get immediate service. Our campaign tries to address this need gap," explains Sudarshan Gangrade, vice-president, marketing, Ola Cabs.

India's organised car rental industry is dominated by airport transfers, outstation cars and local, point to point transfers. Ola is the largest player in this segment with close to 70 per cent of the market share. With a presence in 60 cities and around 60,000 cabs on its platform, Ola also has auto rickshaws and the yellow-&-black taxis in its roster. According to Gangrade, Ola has not only expanded its reach and service categories, but also increased ad spends in the last six months. Its marketing budget has been upped five to six times in the last two quarters in order to popularise new categories like Ola Mini (the mini is a low-cost service; sedan - middle of the road; and luxury cars - which it calls 'business' class), Pink (the cars are driven by women for women passengers, which is available in Bangalore) and auto rickshaws.

The marketing push has had good results. Ola claims that the usage of its apps went up from 20 per cent (as a percentage of its overall bookings) in January 2014 to 70 per cent this month. It uses its call-centre in cities where smartphone penetration is still low to get people to use the app. "At every touchpoint we are pushing our app. When people call our call-centres we give them incentives to use the app. Other than the TVC, digital and outdoor campaigns have been designed to promote the app. Recently, we also had a special fare with a 50 per cent discount for bookings done through the app," added Gangrade.

Taxi stand

Ola is not the only one trying to take a bite off the UBER pie. Radio taxis like Meru and TaxiForSure have also come up with campaigns to promote their apps. Meru - one of the first radio cab services in the country - has been trying to push its app platform by offering heavy discounts. A recent radio spot explains the use of the 'My Wallet' feature on the Meru app, where consumers get 30 per cent of their money back.

Meru is giving discounts for app bookings

Meru offers a flat discount of Rs 150, along with reduced fares across cities, for first-time users of the app. It has also started verifying the driver's Aadhaar card every time a ride is booked. Additional features such as the 'Trip Tracker' and 'Ice Button' on their app (which lets people save emergency telephone numbers of their close friends or family so that the latter can track the journey) make the ride safer and hopefully up the trust factor.

This is not the first time Meru has gone in for promotions. Post the launch of the app a year and half ago, Meru had tied up with Nokia and the app was made available in Nokia app stores. Moreover, a 'happy hour' was introduced for better fares while a tie-up with Flipkart allowed Meru reach out to the consumer segment that was already comfortable with app-based transactions.

Rathin Lahiri

TaxiforSure has been presenting their drivers in a new light

"The penetration of smartphones in our addressable market is 100 per cent. Fundamentally, the business itself is reshaping. The campaign push is more to point out the dormant need fulfilled by apps," explains Rathin Lahiri, CMO, Meru Cabs.

According to Lahiri, an app makes the consumer experience extremely convenient. But more than that, it increases the frequency of travel. Meru has already seen increased bookings on weekends and Sundays for impulsive or unplanned outings. While the company's booking ratio was skewed towards planned bookings a year back, today over 65 per cent are immediate bookings, made mostly through the app.

Taxi aggregator TaxiForSure had released a campaign for its app in the beginning of December, but took it off air a few days after the UBER incident. The company plans to bring it back later this month. Alongside, the company has been creating conversations on its Facebook page by talking about its drivers in a humane way.

It is not just the aggregators and radio cabs which are focusing on the apps. Car-rental company Savaari has launched unique packages like '8 hours Unlimited KMs' (unlike the usual 8 hours or 80 km at a certain rate) and flat pricing for airport transfers. Headquartered in Bangalore, Savaari Car Rentals, is present in 60 cities and takes bookings through its website and android app.

Gaurav Aggarwal, founder and CEO, Savaari Car Rentals does not feel that any of the companies has put in additional marketing efforts post the UBER incident. "There is a huge space to be created in the 'point to point' transfer segment. All the present marketing efforts by various companies are towards building that segment. But to rebuild the trust, certain hygiene factors like GPS systems, a panic button and response centres have to be kept in mind."

Sundeep Nagpal

Sundeep Nagpal, founder-director, Stratagem Media feels that coming up with a campaign to build the sector is good, but to use discounts as a tactic is not going to work. "It is a desperate move to grab whatever market share you can. Established companies should encash on their equity and not bank on discounts. Meru's earlier campaigns have focused more on the brand image and the mobile app has only had a disguised push. But it seems like they are trying to make most of the situation since app-based services have found so many takers," opines Nagpal.

First Published : January 07, 2015

© 2015 afaqs!