Final Report Kartiksaini BBA6A PDF

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PROJECT REPORTONCUSTOMER PREFERENCE TOWARDS OLA AND UBERSUBMITTED IN PARTIAL FULFILLMENT FOR THEAWARD OF THEDEGREE OF BACHELOR OF BUSINESSADMINISTRATIONUNDER THE GUIDANCE OF MS. RITIKA BHATIAFACULTY, MAIMSSUBMITTED BY: KARTIK SAINI 03614701717BATCH NO. 2017-2020 BBA 6-ACONTENTSTopic Page No.Student ...

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PROJECT REPORT ON CUSTOMER PREFERENCE TOWARDS OLA AND UBER SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF THE DEGREE OF BACHELOR OF BUSINESS ADMINISTRATION UNDER THE GUIDANCE OF MS. RITIKA BHATIA FACULTY, MAIMS SUBMITTED BY: KARTIK SAINI 03614701717 BATCH NO. 2017-2020 BBA 6-A

CONTENTS Topic Student declaration Certificate from Guide Executive Summary Chapter 1: Introduction Chapter 2: Review of Literature Chapter 3: Research Methodology Chapter 4: Data Collection Chapter 5: Data Analysis Chapter 6: Findings and Suggestions CHAPTER 7: Conclusion References/Bibliography Appendices

Page No.

STUDENT DECLARATION

This is to certify that I have completed the Project titled “Customer preference towards Ola and Uber” under the guidance of “MS. Ritika Bhatia” in partial fulfillment of the requirement for the award of degree of Bachelor of Business Administration (BBA) at Maharaja Agrasen Institute of Management Studies, Rohini. This is an original piece of work and has not been submitted elsewhere.

KARTIK SAINI

Certificate from Guide

This is to certify that the Project titled “Customer preference towards Ola and Uber” is an academic work done by “Kartik Saini” submitted in the partial fulfillment of the requirement for the award of the Degree of Bachelor of Business Administration (BBA) from Maharaja Agrasen Institute of Management Studies, Rohini. It has been completed under the guidance of Ms. Ritika Bhatia (Faculty Guide). The authenticity of the project work will be examined by the viva examiner which includes data verification, checking duplicity of information etc. and it may be rejected due to non-fulfillment of quality standards set by the Institute.

MS. RITIKA BHATIA

Executive Summary

India witnessed entry of app-based taxi services through aggregators such as Uber and OLA somewhere in 2013. Uber group entered Indian Radio Taxi Services Market in 2013 and started its operations in Delhi in December 2013 and offered services under three band names namely, Uber Black, Uber X and Uber Go. ANI Technologies Pvt Ltd. an Indian Aggregator, introduced OLA app-based Taxi and auto services around same time.

Uber and OLA entered the taxi services as aggregators to provide app-based taxi services to passengers in major metropolitan cities in India. Both Ola and Uber offered passengers air-conditioned taxi services at comparatively cheaper fares. Assured taxi service at a door step to be summoned on the mobile app gave the passengers the much-needed comfort coupled with reasonable fares. In many cases the fares offered by Uber and OLA were found to be less than the fares charged by 3-wheeler autorickshaws. No wonder, in less than a year's time there was a major shift of passengers from traditional black & yellow taxis and autos to the newly introduced air-conditioned app- based taxis offered by Uber and OLA.

This major migration of passengers from traditional taxi/auto services to app-based taxi services obviously created panic amongst the taxi/auto owners/drivers as they witnessed losses in their daily revenues and their very survival threatened. On the other hand, the passengers - hitherto harassed and exploited by the taxi/auto drivers - had a smile on their face as they got comfortable journey ride at a most affordable price.

Chapter-1 INTRODUCTION

1.1 INTRODUCTION

About Ola ANI Technologies Pvt. Ltd. operating under the trade name Ola, is an Indian online transportation network company. Ola was founded as an online cab aggregator in Mumbai, but is now based in Bangalore. As of September 2015, Ola was valued at $5 billion. In March 2015, Ola Cabs acquired Bangalore based cab service TaxiForSure for about $200 million. From the 25th of June 2015, Ola users have gained access to TFS cabs via the Ola mobile application. By November 2015, Ola had acquired Geotagg, a trip- planning applications company, for an undisclosed sum to strengthen its new bus-shuttle service. It was founded on 3rd December 2010 by Bhavish Aggarwal (currently CEO) and Ankit Bhati. As of 2014, the company had expanded to a network of more than 200,000 cars across 100 cities. In November 2014, Ola expanded to incorporate autos on-trial basis in Bangalore. Post the trial phase, Ola Auto expanded to other cities like Delhi, Pune, Chennai and Hyderabad and Kolkata starting December 2014. In December 2015, Ola expanded its auto services in Chandigarh, Indore, Jaipur and Guwahati, Visakhapatnam. Ola is valued at $5 billion as of September 2015.Ola provides different types of cab service ranging from economic to luxury travel. The cabs are reserved through a mobile app. This cab service supports both cash and cashless payment options with Ola money. It claims to clock an average of more than 150,000 bookings per day and commands 60 percent of the market share in India. November 2014 Ola also started on-demand auto rickshaw service on its mobile app in Bangalore, Pune and few other cities.

About Uber Uber Technologies Inc. is a transportation network company headquartered in San Francisco, California, United States, operating in 528 cities worldwide. It develops, markets and operates the Uber car transportation and food delivery mobile apps. Uber drivers use their own personal cars, although drivers can rent a car to drive with Uber. Uber has been a pioneer in the sharing economy and the changes in industries as a result of the sharing economy has been referred to as "Uberification" or "Uberisation". Uber has also been the subject of protests and legal actions. Uber was founded in 2009 as UberCab by Garrett Camp, the cofounder of StumbleUpon, and Travis Kalanick, who had sold his Red Swoosh startup for $19 million in 2007. The name "Uber" is a reference to the common (and somewhat slangy) word "uber", meaning "topmost" or "super", and having its origins in the German word über, meaning "above". Kalanick joined Camp and gives him "full credit for the idea" of Uber. Camp spent $800 hiring a private driver with friends and had been mulling over ways to decrease the cost of black car services ever since. He realized that sharing the cost with people could make it affordable, and his idea morphed into Uber. "Garrett is the guy who invented that shit," Kalanick said at an early Uber event in San Francisco. The first prototype was built by Camp, and his friends, Oscar Salazar and Conrad

Whelan, with Kalanick being brought on as a "mega advisor" to the company. Uber's first market was San Francisco and, following a beta launch in May 2010, Uber's services and mobile app officially launched there in 2011. Originally, the application only allowed users to hail a black luxury car and the price was 1.5 times that of a taxi. In February 2010, Ryan Graves became the first Uber employee, getting the job by responding to a tweet from Kalanick announcing the job opening, and receiving 5-10% of the company. After ten months as CEO, Kalanick succeeded him as CEO in December 2010. Graves stepped down to become the company's COO. In 2011, the company changed its name from UberCab to Uber. During the initial development of the Uber app, the company created a think tank consisting of a nuclear physicist, a computational neuroscientist, and a machinery expert who worked on predicting demand for private hire car drivers and where demand is highest.

OBJECTIVES OF THE STUDY

A research study tends to follow and achieve specific objectives. The objectives of this particular study are:  To know the views of people regarding various radio taxis.

 Comparison between various radio taxis.

 To study the preferences and buying behaviour of consumers in case of taxis.

1.3 SCOPE OF THE STUDY

1.1 The purpose of the methodology is to design the research procedure. This includes

the overall design, the sampling procedure, the data collection method and analysis procedure.

1.4 INDUSTRY/COMPANY/PRODUCT/PROCESS DETAIL

It's hard to believe that a company whose only product is an app on your phone that calls taxis it doesn't even own, is valued at $62.5 billion (approximately Rs. 4,19,562.5crores). Uber's business model depends on being the middleman between the taxi driver and the rider, and managing transactions on the app. Doing this, Uber has scaled globally to 67 countries and 360 cities, taking on governments and taxi unions around the world, and completing a billion rides by the end of 2015. Before Uber arrived in India though, another company was able to implement a similar model here, and today, Ola is one of the most well-funded tech startups in India. It raised over $900 million (approximately Rs. 6,713 crores) in 2015 alone, valued at over $5 billion (approximately Rs. 33,058 crores). Uber's playbook hasn't seen it take a position of dominance in India, where Ola is providing real competition. Here's how the two companies stack up against each other.

By the numbers There are a number of different things to consider when comparing the two companies. The number of cars, the fares they offer, and of course, the number of customers on both platforms shows the difference between the two. App install data seems to indicate that Ola has the lead in India. The Ola app has been downloaded more than twice as much as Uber, according to a survey by WhichApp, based on app data of over 90,000 Android users from India. App install data seems to indicate that Ola has the lead in India. The Ola app has been downloaded more than twice as much as Uber, according to a survey by WhichApp, based on app data of over 90,000 Android users from India.

According to Quettra's Asia data, which tracks installs on Android devices, Ola Cabs app installs lead Uber four to one as of the end of May 2015. Ola says it has over 25 million customers in India, as of October 2015. The gap in iOS app installs might be smaller, or even skewed in the other direction, but according to Statista data for December, Android has a 64.32 percent share of the Indian market, while iOS is a mere 1.82 percent, so this gives a fairly clear picture of which app has been downloaded more in India. "Immense availability and a wide range of mobility options for different use cases makes us the most preferred platform for millions," says Anand Subramanian, Senior Director, Marketing Communications at Ola. Ola also remarked that WhichApp's survey data does not track install data on TaxiForSure's app - Ola acquired TaxiForSure in March 2015, adding the cars and users from that service to its own platform. We also asked Uber to confirm the details about app installs, and although the company stated that it could not share specific data, it did not contradict the figures we shared. Instead, Uber shared information from app analytics platform Similarweb that compares the current install rates for the two apps. This data shows that in terms of the number of new users added each month, the two apps are closer - Ola still has a lead, but it was ahead by 7.5 percent in July 2015, and is leading by 6.74 percent in current app installs in 2015. Another data point from the report shows that Ola's active users have decreased 12 percent while Uber's have gone up by 3 percent in the same period - however, none of the data that Uber has shared actually contradicts the numbers we're seeing, since it doesn't include the base figure being used to calculate the percentages. Uber began its India operations in 2013, and currently has over 200 full time employees, and plans to invest $1 billion (Rs. 6,808 crores) in India by 2016, the company stated in an email. Uber says it has over 250,000 driver partners on its platform, and is available in 26 cities - its latest launches were in Ajmer, Jodhpur, Mangalore and Udaipur. Uber had added autos, to its app in April, but removed them in December. Ola claims to have one lakh more vehicles available via its app. Ola says that it has a fleet of 350,000 vehicles, include government-licensed taxis and autorickshaws.

Founded in Jan 2011 by IIT Bombay alumni Bhavish Aggarwal and Ankit Bhati, Ola says it is presently operational in 102 cities, and it claimed a growth rate of 30 times in 2015. It also says it received one million booking requests a day in October 2015.

Although Ola's reach appears to be a lot bigger than Uber's, it's worth pointing out that the actual experience in smaller towns can be a little different than using the service in cities - on a

recent trip to Lucknow, we saw wait times of over 30 minutes at all times, and had multiple trips cancelled by drivers who said we were too far away. This makes sense when you consider that its fleet of taxis is, at best, 30 percent bigger than Uber's (and probably less than that), but it's covering nearly five times as many cities.

Who's got cheaper fares? Uber Founder Travis Kalanick, while addressing a session at Start Up India event in New Delhi last month said that Uber had started out as a private beta with high-end Mercedes cars, but then shifted its focus to low-cost rides. "What we found is that low cost means that lots of people can use it. Lots of people using it, means lots of cars. Lots of cars mean low pickup times, and also means reliable pickups in a bigger area," he said. "It also means, for the driver, that they can make more money, because where they drop you off, they're more likely to get a trip back. We found that the cheaper products were actually more luxurious." How does this stack with the prices you see on your app? While comparing both their offerings, there are a few differences that you should keep in mind. Ola lets users make advanced bookings with the Ride Later option, while Uber does not. Uber has a cancellation free, Ola does not. Both services have a per-minute charge as well, which varies from Rs. 1 to Rs. 2.5 depending on the car's category. Ola's per-minute ride-time tariffs only start ticking five minutes after the ride in some cities, according to the tariff charts. Apart from this, in Hyderabad and Bengaluru, Ola levies an 'Airport rate' that has a much higher fare and minimum bill amount, which can prove costlier than radio taxis, based on surge pricing. Both companies have launched ride sharing services and private carpooling services in Delhi. Ola plans to launch Ola Share in 20 cities across the country over the next six months. A quick analysis of all the fleets, (which range from hatchbacks to sedans, to luxury sedans and SUVs,) operating in the Indian metros reveals that the lowest minimum fare for a cab is in Kolkata, where an UberGo starts at Rs. 45. At the time of writing, UberGo had a per kilometre charge of Rs. 6 in Chennai, Rs. 7 in Bengaluru, Delhi, Hyderabad, and Kolkata, and Rs. 8 in Mumbai. On the other hand, an Ola Mini costs Rs. 10 per kilometre in Bengaluru, Hyderabad, and Chennai, and Rs. 11 per kilometre in Mumbai. The only city where it is cheaper is in Kolkata, where it costs Rs. 7 per kilometre. In Delhi, an Ola Mini costs Rs. 8 per kilometre, with a minimum fare of Rs. 100 for the first four kilometres, while an UberGo has a minimum fare of Rs. 60. Generally speaking, it appears that UberGo is likely to be the cheapest on your wallet, barring any surge pricing. Predicting which app will have higher surge rates at any point in time is something that's worthy of a PhD thesis. With a market size of INR1 14.4 billion in 2011-12, the five-year-old Indian radio cab industry was expected to grow by 30.9 per cent in the next five years.2 The industry was dominated by four

companies - Meru Cabs, Easy Cabs, Mega Cabs and TABcab (see Exhibit 1). The still fledgling industry offered no obvious or accepted business model that could be emulated. By refining their models through trial and error, radio cab companies in India stumbled upon two types of fleetbased business models - company owned and franchise based (see Exhibit 2). Typically, radio cab companies relied on two streams of revenue generation- fares and advertisements (commonly referred to as “cabvertising”).

Though it was in a nascent stage, the radio taxi industry in India witnessed huge demand and high growth. The fleet size of radio cabs, mainly concentrated in four Indian metros,3 was about 15,000 in 2011-12. With demand far outstripping supply, the total number of radio cabs was expected to increase at a compound annual growth rate (CAGR) of 25 percent.4 The decline in the fleet size of non-radio taxis due to ageing cabs, the significant growth of India’s urban population, increase in disposable incomes, high traffic on other forms of public transport, greater perceived comfort compared to driving one’s own vehicle official reimbursement of taxi fares, influx of tourists and increased airport trips, were some of the factors that contributed to the soaring demand for radio cabs. However, constraints on the supply side due to the shortage of suitable and educated drivers, high cab maintenance costs and varying government regulations in every state hindered growth. Many drivers who already owned their own cabs or worked for other non-radio cab operators balked at paying the high daily rental fee to the radio cab company. Even though radio cab drivers typically earned 70 per cent more than their nonradio taxi counterparts, many drivers preferred not to join radio cab companies. The fact that it was compulsory for them to pay daily rentals even if they were not driving the cab meant that they had to work every day of the week. Issues such as these reduced the availability of drivers. Further, the radio cab industry was highly regulated and government regulations were state specific. Red tape, the ceiling on the number of permits that could be held by a radio cab operator, stringent criteria for qualifying to become a radio cab driver, restrictions on size of the radio cab and government regulations regarding fares, were some of the negatives of the regulatory environment in which the radio cab industry operated. Factors such as these contributed to the sub-optimal supply of radio cabs, resulting in high rates of denial of service (see Exhibit 3). Given the existing demand scenario, the four big radio cab companies were estimated to have a shortfall of 3,619-5,467 cabs in the major cities in which they operated.

Rajiv Vij, CEO, Easy Cabs, was quoted as saying, “Over the next five years, we expect to see 5-6 big cities, each with a population of about 20,000 radio taxis, with three large operators controlling 80 per cent market share. We also see the rise of 20 Tier II cities, with a population of 5,000-10,000 radio taxis each, with 5-6 players controlling up to 70 per cent market share.”6 For radio cab operators, airport trips were the most preferred service, but point-to-point commuting services were also expected to become increasingly lucrative. Analysts predicted that three to four years post 2011 there would still be huge demand for radio cabs; however, there would be significant competition from online car aggregators7 and car rental companies. In addition to providing services similar to radio cab operators, these companies offered inter-city services, which were not offered by radio cab operators. Competition would also come from economy radio cabs, which did not have a sizeable place in metros, but were expected to successfully operate in other Tier I and Tier II cities, 8 where the four major radio cab operators planned to make their foray in the future.

To meet the existing demand, the major radio cab companies had to scale up their operations. This required greater investment, which the companies managed by infusing equity capital into their businesses. Thus, even after five years in the business, major radio cab companies had not yet become profitable.

A smartphone and a good network connection is almost all that a consumer needs today to fulfil an entire spectrum of needs. Tech-savvy Indians have an app for just about everything; from booking movie tickets to planning holidays, ordering groceries and of course, hailing a cab. The on-demand ...