How to achieve reliability in vehicle sharing
Reliability plays a center stage role in most, if not all businesses, and shared mobility is no different. The lack of reliability can then be the downfall of your business. ‘The rental that never happened’ is every shared mobility provider’s nightmare. Now, as to why that rental didn’t happen can vary, but at the end of the day, in the eye of the potential consumer, it translates to a lack of reliability. If consumers cannot trust that a service will be available when, where, and how they need it, then they’re not going to come back next time. This is especially important when it comes to shifting consumer habits from defaulting to a private vehicle, when the goal is to get them into the more sustainable, shared vehicle alternatives.
The rental that never happened
Not being able to start the rental of a shared vehicle can be due to a number of reasons: the location of the vehicle may not be accurate so the user ends up not being able to find the vehicle; the vehicle’s telematics and/or connectivity solution might be down and not be able to send/receive messages to the cloud, meaning the vehicle can’t respond to the user’s app request to start the rental; in moped sharing, there may be a helmet missing from the top case, which would mean the user isn’t able to ride the moped safely. Not only would these situations cause frustration for the user, but it would also result in unnecessary inconvenience and impact their decision to choose shared mobility for future trips – whether that’s your service specifically or other available options in general.
To build or buy, that is the question
Reliability results from the seamless interaction between the different components of the shared mobility business both physical when it comes to the vehicle and digital for example connectivity, sharing software or user app. This relatively young industry is starting to learn that not all these components need to be developed in-house. Since speed to market is important, you don’t have to start from scratch. Quite the contrary! When it comes to deciding whether or not to build or buy the components of your shared mobility tech stack, there are different questions to consider:
What are the key components and processes for a reliable product? Where can operators differentiate? Can a reliable solution be found from other industry experts?
Let’s start by looking at the different components involved in a shared mobility business:
- Telematics and connectivity
- Fleet data management software
- Sharing software and booking application
With the wide range of vehicles available in the market, most operators will be able to find one that will meet their needs. Notably, the market has a growing number of purpose-built vehicles that are sturdy and robust enough to handle the high usage that comes with a shared vehicle. When it comes to the telematics and software components of the shared mobility tech stack, this is where the decision to build or buy becomes a critical part to building up a reliable service.
One strategic approach to the build or buy decision is to identify which areas would allow you to differentiate your service and which are “mission critical” basics that are necessary but not meant to “wow” the customer. Aspects that have the potential to “wow” the customer include developing a strong vehicle and trip experience, making it easy and simple to use the booking app, and setting up custom pricing and offers tailored to the customer. The “mission critical” basics, on the other hand, include driver’s license verification, payment processes, and telematics connectivity. These are important processes but don’t differentiate one service from another. As a result, it may make sense to choose a proven third-party provider to outsource these components to. By doing so, this will free up your in-house developer resources dedicated to innovating your core business differentiators and creating unique customer experiences.
Investing in future growth
As responsible business owners, operators certainly think twice about what investments they want to make, especially with their tech stack. When it comes to telematics solutions however, experience shows that cost of investment in a high reliable connectivity solution may seem expensive in isolation when looking at capital cost and even operational costs but actually delivers huge savings and is cheaper in the long run. It directly results in smooth customer interaction, less support requests and excellent user experience and will ultimately contribute to scale and grow the business.
In a nutshell
There is increasing competition in the mobility space and the growing amount of shared mobility services are saturating the market. Our experience from 25+ years in the industry has shown that maintaining reliability and focusing on the competitive advantage, while keeping operational costs in check, are the main challenges that operators are faced with today. Clearly a tough balancing act. Shared mobility operators need to decide whether to build or buy – at the right time and with the right partners.
This will enable operators to focus resources on further developing their core competencies that set them apart from their competition, while efficiently outsourcing other components of their tech stack to reliable and proven third-party suppliers.
With this approach, the reliability factor is not compromised, and even strengthened further. A strong third-party supplier like INVERS, through economies of scale, can offer more cost-efficient standardized solutions at a higher quality, supported by continuous maintenance and innovation, while reducing the shared mobility operator’s business complexity.
Source: Mobility Makers