From being the first app-based cab booking service in India, Ola is rapidly growing in its category, and has very much been in the news. Sudarshan Gangrade, VP – Marketing & Category, Ola talks about building the category like an FMCG product and offering seamless urban transport to the consumer
BY HENNA ACHHPAL
Q] Tell us the growth story of Ola from Day 1 to now.
Ola was started in 2011 and it has been one of the fastest growing start-ups in India, both in terms of volume and valuation. It started with the idea of being a cab rental service, but the founders quickly realized that point-to-point commute or within city travel is a big pain point. It was a huge market opportunity; untapped and unorganized by nature as well. We stopped calling ourselves a cab company quite some time back, we are a company that enables urban transport.
At the beginning of 2014, we were in about 4-6 cities, now we are in 51. The closest competitor is in 10-12 cities. In terms of revenue, we’ve grown about 30-35 times in this year itself. We’ve launched multiple categories – Mini, Sedan, Prime, Autos, and Kaali-Peelis in Mumbai. We have the largest fleet with about 85-90,000 cars on our network, which is many times more than the closest competitor. We were the first ones to introduce app-based bookings, about a year-and-a-half back, far ahead of the market. At the beginning of 2014, bookings through the app stood at 15-20% and grew close to 75% by the end of the year. We hold about 70% of the market-share.
Q] Ola Money was introduced only in October. What took so long?
Again, we were the first ones in the category to introduce a wallet-based feature. Once we saw a dramatic adoption in app-based bookings, and as people got comfortable with our technology, we thought it was the appropriate time to introduce Ola Money. We could have introduced it earlier but from a product technology point of view, we were working on a bunch of priorities. Now, 30-40% of bookings happen through Ola Money.
Q] Discounts and offers seem to be your primary marketing strategy. Why?
Like in e-commerce, heavy discounts are partly to fast-track trial behaviour. When we launch a new feature, we need to give people that extra fillip for trials and we’ve seen that repeat rates are high thereon. We also use email and Digital to promote a new feature. We don’t sell the price point as much as we promote the cashless and seamless experience. It’s a habit formation strategy which takes time to adopt.
Q] How has the category evolved since you started?
The entire category has been created from scratch and we feel proud that we’re building it. Within city commute was not there, there were few players, small in size and unorganized by nature. We’ve seen a dramatic change in how people are using the service. Taxi service was always about planned or one-off journeys. We’re making it a part of daily commute. We’re building the category like an FMCG product. People have quickly moved from once a month use to once a week, and now it’s every other day. Our high frequency customers use Ola 18-19 times a month.
Q] How does Ola stand out from its competition?
To build this as a daily use category, we’re focusing on three pillars. One is availability, which is crucial. People should not wonder when a cab will be available. Eventually, we want to make sure that a transport option is available every two minutes. The second is affordability. If we want to be in the daily use space, we need to be affordable. We are not a niche, super-premium luxury service although we have categories that are premium by nature. Accessibility is the third big thing, which is why we’ve been pushing the app. A customer doesn’t need to call up somebody or wait in a queue. It’s the age of smartphones, the age of people having control over what they want.
Q] When a customer has a bad experience, they’re bound to blame the brand. How do you deal with such a tricky marketing situation?
Our core is technology. We don’t own, we’re aggregators. Individuals own the vehicles, we connect demand and supply. However, it’s difficult to explain to people that we are an aggregator model. Eventually, they’re making the booking through us so they expect us to deliver on the service as well. We have multiple mechanisms in place so that the service is delivered efficiently. We have a strong customer support as well as strong tracking analytics. We continuously track driver ratings. If a driver suddenly falls below a certain level, we immediately take action. We have control over whether they will be on our platform. We try to control the experience that is delivered, but in the end we cannot own it.
Q] How are you making use of marketing?
Over the last few months, we’ve started to use marketing dramatically. We are entering a lot more new cities. There is a huge awareness that needs to be created. In existing cities, we use marketing to build brand awareness. About eight months back, we were still in the ramp up mode; we had the problem of demand, so marketing only played a support function. Now that we’ve reached a certain stage, we are beginning to build the brand. We’re using marketing as a tactical tool to generate demand. We keep doing a lot of interesting things either at the local or regional level. Our strength is real-time, so during Diwali, we had an initiative of getting a box of sweets delivered to loved ones in real-time. During Christmas, in Bangalore, we had a Santa on call. Customers could click a button in the app and within minutes, a Santa would be at their home to deliver a bag of goodies. These are centred on getting people to go to the app and explore it. When we launched autos in Bangalore, we asked people to click a selfie with their auto driver.
Q] What is the media mix like?
The mix depends from city to city. If it’s a launch city, OOH and Print will be heavy followed by Radio. In existing cities, it’s typically Print and Radio. Digital is a key part of our business, but we are still offline heavy as this is a city-centric business by nature. We work closely with Facebook and Google, and are building several beta products with Facebook. Last week, we launched our first ever brand campaign, Chalo Niklo, spanning TV, Print, OOH, Radio and Digital.
Q] What are Ola’s targets for the coming year?
We will be in 100-plus cities, introduce a few more categories which are currently in the pipeline. Autos will be ramped up across most of the cities. We’ve got Mini, Sedan, Prime but all three categories are not present in all cities. We will make sure there is availability across cities. Year 2015 is going to be a very busy year for us.
ABOUT THE BRAND
Ola (formerly Olacabs), founded in 2011 by IIT, Bombay alumni Bhavish Aggarwal and Ankit Bhati, is India’s leading mobile application for cab booking, integrating city transportation for customers and drivers onto a technology platform. Ola’s proprietary mobile application for drivers across commercial transport vehicles helps them connect with customers looking for a safe and reliable ride. Customers can access Ola through their mobile application for Android, iOS and Windows. Ola offers over 60,000 cabs across 50 cities. Using the Ola app, commuters can also book autos in Bangalore, Delhi, Chennai, Pune and Kaali-Peeli taxis in Mumbai.
FACTS
Creative Agency: Happy Creative Services
Media Agency: Motivator World
Digital Agency: In-house
PR Agency: Aim High Consulting
MARKETING TIP
Having systems that are continuously looking at data, and tracking data at a granular level is extremely important.
CMO FILE
Sudarshan Gangrade is responsible for Ola’s marketing across online, offline, social and partnerships. He also oversees setting up the category management practice at Ola, the latest additions include Ola Prime and Ola Pink. He is an engineer from IIT, Kharagpur and an MBA from IIM, Bangalore. Sudarshan has over 11.5 years of experience across FMCG, Advanced Analytics, Government projects and e-commerce. Earlier in his career, he has worked with UIDAI, Babyoye, WNS and Asian Paints.
Feedback: henna@exchange4media.com
