Commander, we will agree – Newspaper Kommersant No. 208 (7409) dated 11/10/2022
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The fall in consumer income is forcing taxi aggregators to look for alternative ways to attract customers. People & People, developing, in particular, the Taxovichkof and Citymobil services, is launching a new travel service, LuuLuu, where passengers can offer prices. Experts doubt that the contractual pricing model in taxis can become widespread. They cite a similar service, inDrive, as an example, which never managed to take a prominent position in the market.
People & People, which manages the brands Gruzovichkof, Taxovichkof and Citymobil, will launch a new travel service, LuuLuu, in November, where the user can directly negotiate the cost of the trip with the driver. Igor Rudziy, CEO of the company, told Kommersant about this. For the new service, the company has already developed an application for iOS and Android, Kommersant was convinced. According to Mr. Rudziya, LuuLuu is planning to expand in the regions of the country and abroad through the sale of a franchise and the creation of joint ventures.
The new app provides car rides, including long-distance, courier delivery and freight transportation, according to the description of the app in the App Store. Drivers of all People & People projects can connect to work in the new service, but there is no direct integration between them, explains Igor Rudziy.
A service with a similar pricing model has been developed by inDrive, based in Yakutia, since 2012. Today, the company is based in Mountain View, California and operates in 47 countries, according to information on the company’s website.
After the outbreak of military operations of the Russian Federation in Ukraine, inDrive decided to transfer part of the employees from Russia to Kazakhstan, Cyprus and other countries, the founder of the company, Arsen Tomsky, said earlier. Also, according to him, the share of the Russian Federation from the total volume of inDrive trips was 7% at the end of February and will decrease. inDrive declined to comment.
Taxi ordering service Maxim noted that they use two pricing systems, including a negotiated one. The passenger can increase the cost of the trip or request a price offer from the drivers, the company clarifies. Maxim believes that the contractual pricing model is convenient for the passenger due to the opportunity to offer the minimum cost of the trip, but if the cost of the trip is incorrectly estimated, he will have to wait a long time for the car and bargain.
The classic pricing system depending on the demand for taxis helps to balance the load on aggregators and make the tariff fair for both parties, says Sergey Nikitchuk, partner at B1 Group (former EY). However, he adds, if the user is willing to pay less and is willing to wait for the driver, alternative pricing methods are also effective in retaining the passenger.
Vladimir Bespalov, an analyst in the technology, media and telecommunications sector, believes that the launch of the new LuuLuu project will allow the owners of the Taxovichkof and Citymobil services to expand their audience, as well as increase taxi occupancy, for example, during periods of low demand.
The contractual pricing model in taxis has not really taken root in Russia, an example of this is inDrive, which occupies a small market share, says Stanislav Schwagerus, head of the MEFT Competence Center. According to the Analytical Center under the Government of Russia, in 2021 Yandex.Taxi (66%) was the leader in terms of revenue share among taxi aggregators, Citymobil was in second place (8%), followed by Vezet, Maxim services. and Gett (7% each).
Stanislav Schwagerus believes that today, in order to increase their share in the taxi market, it is not enough for aggregators to only offer new pricing systems. In his opinion, it is necessary to support drivers, assist in the renewal of the fleet and increase the level of responsibility of services to passengers.
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