Business plan for the launch of Lyft in the Indian market and also evaluating the value proposition

INTRODUCTION:

Lyft Inc. Is a San Francisco, California based company and operates in 644 cities in the United States and 12 cities in Canada. It was started in 2012 and launched peer-to-peer marketplace for on-demanding ridesharing. For the quarter ended December 31, 2019, it had 22.9 million active riders. Mission: Improve people’s lives with the world’s best transportation. Market Opportunity in India: With massive Urbanization, from 2014 to 2018, India was the world’s fastest growing major economy, surpassing China where transportation is a massive market. India,s market is still in the early majority stage in capturing the massive opportunity of rideshare. I believe that it has a significant incremental opportunity to address transportation needs of businesses and individuals.

BUSINESS MODEL CANVAS

Customer Segments: The Lyft business model has three groups of customers: users, corporate business and drivers. The user segments consists of those who do not own a car and want cost-efficient ride from their doorstep. Drivers are those who own a car and want to earn extra income by working on their convenient time. Business partners are the corporate companies which are dependent on the private transportation option to provide employee’s pick-up and drop facility.

Value Proposition: Machine learning algorithms continuously matches riders with drivers and provide faster arrival time, localized pricing and maximum availability. It also dynamically incentivizes drivers to be on the platform when the riders are seeking transportation. At the same time, it also address pain points of the customers. The company provides transparency to the users by showing exactly where the taxi is at all time. It also provides digital receipts to the customers. Its customized ride option helps the corporate partner solve transportation problems.

Revenue Streams: The company earns commission on every ride sharing. It also own few number of vehicles which it give to those who want to drive but don’t own a car. The company earns revenue by deducting from their commission. It provides customized ride solution to the corporate partners as well as to the public events from where it earns transaction fees.

Channels: The company uses mobile application, web application, email and text message to connect with the users. It also uses traditional digital and social media marketing strategies.

Customer Relationship: The company provides variety of offers customized to the user needs. Its AI driven application automatically invites the driver to login on the platform when the demand is high. It has two way rating systems. If the driver is rated 4 star or below, Lyft obtained detailed feedback, reviews the situation and follow up if necessary on the ride experience. It also provides 24/7 customer support to riders and business partners.

Key Activities: The company spends a good amount of time to grow rider and driver bases. It makes investment in brand and growth marketing to increase customer awareness. Lyft maintain a zero tolerance to drug and alcohol policy for drivers and periodically checks and takes required action. Approximately 43% of company employees work in product management,engineering and design organizations, including several hundread employees in level 5 engineering centre in Palo Alto, California.

Key Resources: Lyft has AI driven technology platform which as features such as pricing algorithm to balance the price and market demand. It also has routing algorithm to ensure that the customers wait time is as short as possible. It has a good number of experienced and skilled drivers. As of December 31, 2019, it had 5683 employees in over 100 offices and additional locations, including Driver Hub, Driver Centres and Service Desks.

Key Partners: The main key partner of the company is drivers who own the cars and insurance companies which provides insurance to the riders. It also has contract with vehicle maintenance service providers as well as vehicle leasing service providers. To use maps and navigation system, the company is dependent on the third party API providers.

Cost structure: There are huge cost occurs in brand and growth marketing. Then, there are driver payments on weekly basis. It has approximately 6000 full time employees who get paid on monthly basis. The company is dependent on third parties for some of the technologies and services such as payment gateway, driver verification and so on to whom it pays a good amount of money.

Value Proposition Canvas

PERSONAS

1.VISHNU MAGAM

• 60 years old

• Retired and working for social benefit

• Focus on Environment Sustainability

• Follow traditional way to solve daily problems

• Maintain punctuality and discipline in life

• Loves to be genuine and transparent, expect others to be the same

• Follow traffic rules and love safe and smooth driving

• Read newspaper every day and listen to old songs on radio

• Love to socialize

• Doesn’t like uncleanliness

• Apprehensive in using the technology because of many clicks

• Rely on others to learn technology and search anything online

• Loves to pay everywhere in cash

• Doesn’t likes very crowded places

• Prefer economical products

2. VAMSHI MAGAM

• 35 YEARS OLD

• Running a startup

• A tech savvy

• Hate to reimburse the transportation claims on daily basis

• Want to hire driver and purchase car for office work

• Prefer cost-effective solutions

• Prefer trust, safety, reliability and privacy

• Prefer prompt solution from vendor/service provider

• Prefer digital and accurate receipts of every official expenditure

• Very much concerned about women employees safety especially, during office travelling hours

Customer profile

Customer jobs: The target customers are retired, businessman and young men/women. All of them focus on environment sustainability and prefer cost-effective solutions.

Customer Pains: They don’t like to pay more money and they are very much concerned about safety and security. They don’t like to waste time in waiting for a cab. Retired persons doesn’t like to book cabs because of many clicks which is hard for them to understand. Businessmen are scared of sending women employee for safety reasons. Even the young women are scared of going alone in a cab. Retired/less educated persons don’t like to pay by card or online in contrast to that businessmen and young men/women prefer paying online but businessmen doesn’t like to settle every single transaction on daily basis instead they prefer monthly basis.

Customer Gains: They love to get services for cheaper rate and also without waiting for a long time. Retired persons enjoy booking a cab by themselves in just one or two clicks. They love to settle every financial transaction transparently.

Value Proposition

Pain Relievers: The company provides emergency access to 100(police control room) within the app. It also allows sharing the live tracking of rides with the family and friends. It has integrated payment option as well as pay by cash option, also partnering and taking many initiatives to reduce the riding cost as much as possible.

Gain Creators: The company technology effectively matches riders with drivers through advanced dispatching algorithm provides faster arrival times, localized pricing and maximum availability. The company continuously working to reduce the friction in the booking process like “one tap ride”, So riders can reach their destination quickly. It provides digital and transparent receipts for every ride.

Product and Services: The company provides on-demand cab availability customized to user needs. It also provides monthly billing option and Lyft pass to corporate partners. Company is continuously working towards the drivers network. It has IOS app, Android app and web booking software.