Any innovative business that brings an added convenience to a traditional service is bound to receive a huge inflow of traffic and volumes. It is only after the volumes become huge that a business realizes the need for diversifying into multiple funnels, so it can give a special offering of each kind for customers.
The ride-hailing business also falls into the same category. When Uber opened the gates of location-based on-demand transportation, it was a massive hit. It became so popular that even the market for Uber clones started to grow and a lot of entrepreneurs took clone scripts for launching their own ride-hailing service business.
The Growth of Ride-Hailing Business
The biggest proof of the growth of the ride-hailing business has to be in how mainstream the expression ‘Let’s book an Uber’ has become. In addition to this, Statista has shown that the revenue from the ride-hailing sector has been growing from little over $150 billion in 2017, and is all set to cross the $200 billion mark in 2020.
The penetration is expected to grow in the Asia-Pacific region, owing to the presence of populous countries like India and China.
The Need For Segmenting Customers
It is only when you handle huge volumes of customers, you realize that not all customers are the same. There is no one-size-fits-all formula. Ever since cabs have transitioned from being a luxury to utility today, there is a need to segment users based on what they expect of their service.
It is quite possible and has been proven many a time in history that segmenting of customers in any field can result in the revenue getting doubled. The ride-sharing industry cannot be an exception to this evergreen strategy.
The Benefits of Customer Segmentation
As discussed in the above paragraph, the most obvious and important outcome of segmenting customers is the increase in revenue. It also helps establish a with your using different emotions. This results in an improved brand-empathy
For some of them, it is about availability while for some, it is about punctuality. For others, it is about luxury. And for a few, it is about isolated events that your brand has helped them in a way that it touches their emotions – like their drive on a first date.
Better Marketing
Marketing is about connecting with the right people at the right time with the right message. Segmentation helps isolate the ‘right people’ with respect to the timing and messages. If you have segregated your luxury-users and have a method to identify them separately, you do not have to talk to them about the efficiency in pricing.
With the availability of different marketing media like social platforms, email, and even notifications, it is quite possible that your marketing is extremely effective when you have a segmented approach towards your customers. In the long run, it is also possible to identify the most profitable segment and invest more money in marketing for those users.
Better Product-Improvements
Picking up from where the last paragraph was left, a product needs to be continuously innovated to stay relevant and profitable. The innovation needs to be in line with the demands of the customers. In order to understand the needs of different sets of customers, it is important to segregate them into distinct groups.
If there is a set of customers who do not fall into any of the pockets that you have already created, it presents a new opportunity for business and marketing. This exploration can be possible only when you create buckets of customers. Based on these customers, you can develop the ride-hailing app either from scratch or through ready-made solutions like Uber like app solution.
Better (Profitable) Business Models
If you can precisely cater to the requirements of a specific set of customers, it is quite possible that they stay attached to your brand. This also translates into them continually using your services and keeping the revenue counter ticking. After all, any strategy has to culminate in profit.
How Do You Segment?
Remember the times when you use to connect with random strangers in Yahoo! Messenger? The basic questions that you asked still remain the basic parameters for customer segmentation – age, gender, and location! In addition to that, with the depth of demographic data that is available from social platforms, it is easier to segment and target people according to their interests and professional attributes.
Above everything, one of the best segmenting tools that you have is in your App itself! Based on their frequency of using your services, the kind of cars that they prefer, the places between which they usually commute, their willingness to use your services during surge pricing and the payment options that they use, you can segment your customers.
Segmenting by financial capabilities is one of the most important and lucrative ways to segregate your customers. If you can separate the people with high spending potential, you can sell them certain add-on services that make them feel pampered. A few examples can be options to make the driver wait, choosing cars of their choice, luggage help, and even setting the air conditioner temperature.
Conclusion
Every business looks forward to increasing its revenue in every way possible, and making the revenue double is bound to excite and entice any business owner. Simple strategies like segmenting your customers can go a long way in creating channels for effective marketing that will result in increased profits. After all, a customer might not like surge pricing, but a business owner is bound to be delighted to see a surge in revenue.
