Why traditional taxi business should take their business online

 You've been running your taxi company successfully for years relying on street hails and call-in reservations. But over the last few years, you’ve noticed business slowing. Fewer people are hailing your cabs or booking over the phone. Ridesharing apps like Uber and Lyft seem to be everywhere, letting passengers request an on-demand car service from their smartphones.

As a traditional taxi operator, you face a choice - evolve your business to meet changing consumer preferences for digitally booking rides or risk becoming obsolete. Going online may feel daunting, but it’s essential for competing in the modern landscape.

Here’s why digitizing your taxi dispatch is necessary for keeping up with new mobility demands - and tips for making the switch.

Benefits of going online for traditional taxi companies 

Apart from the benefit of getting modernized, there are several other advantages and importance of taxi booking software that you can gain by going online. A few of them are below. 

Reach a Broader Customer Base

In the past, you could rely on foot traffic and street hails for customers. But consumer habits have changed. These days people want to book rides without waiting on the curb or making calls. They expect a few taps on an app to summon a car.

Digitizing lets you expand beyond physical streets and phone numbers. Mobile apps give access to huge pools of potential customers - including tech-savvy younger riders. An app makes your cabs visible to anyone with a smartphone across the entire metro area. This lets you scale up dramatically.

Instead of fighting rideshare companies, going online lets you compete for the same growing market of riders. An app puts your taxi company in the palm of every passenger’s hand.

Improved Customer Experience

Beyond widening your reach, digital taxi bookings also upgrade the rider experience. Features we now take for granted from Uber and Lyft – like estimated arrival times, real-time ride tracking, driver details and ratings systems – raise the bar for customer expectations.

Going online isn’t just about convenience anymore – it’s demanded for an acceptable user experience. With app capabilities, passengers can watch as their taxi navigates to the pickup destination. Confidence is inspired knowing trip progress and driver details. Frustration is reduced without staring down the street hoping to spy a taxi sign.

Digitization also aids accountability to riders through driver ratings and centralized customer feedback. You gain rapid user feedback to rectify any decline in service quality – ensuring standards stay high.

Increased Efficiency

Transitioning from analog radio or phone dispatch to digital coordinates offers you enhanced coordination and efficiency. An integrated solution means drivers, dispatchers and customers communicate seamlessly through the same system.

With digital tracking of all vehicles in the fleet, empty taxi cruising time hunting for fares drops substantially. Dispatch routing can guide drivers to neighborhoods and events with high demand instead. Apps provide dynamic heat maps guiding your fleet availability to flow optimally with customer needs.

Digital platforms also compile performance analytics, reporting key metrics like driver earnings, passenger wait times and peak occupancy levels. Access this data empowers smarter management – directing resources when and where they’re most valuable.

Valuable Customer Data and Insights

Collecting customer ride histories and profiles is hugely advantageous as well. A digital framework registers every trip directly, generating a trove of analytics on passengers and travel patterns. Possession of this data is powerful.

With visibility on ridership demographics, popular routes and booking habits, you gain critical input for business decisions. Features can be adjusted to suit commuters or airport transfers. Marketing can be tailored more successfully when customer segments and behaviors are understood. Pricing models can find the right balance through testing against real metrics.

Opens Additional Revenue Streams

A ride-hailing app also unlocks opportunities for ancillary earnings, like promotional discounts, premium car services, advertisements and corporate partnerships.

Bulk transportation accounts with hotels, businesses or airports also grow more accessible. Package deals can offer these partners discounted fares in return for exclusive rights or branding programs. Event sponsorships at local venues, festivals or tourist sites present similar mutually beneficial arrangements.

The benefits swiped by rideshare disruptors can become your advantages as well with the right digital adoption. These additional products and partnerships diversify income channels beyond standard taxi services.

The Challenges of Making the Switch

Upgrading to app-based digital coordination carries notable challenges of course. The investment required in software development, equipment and driver training is no small barrier. Ongoing IT, customer service and marketing costs need inclusion in budget planning as well.

You may also face internal resistance from veteran drivers and dispatch staff unaccustomed to new technologies. Their workflows face serious disruption by phasing out radios for smartphones and software systems. Resentment or distrust of automation is common. Expect a transition period getting all staff proficient and embracing the digital systems.

Passengers similarly need education that your taxi service now offers an app-based alternative. As an unknown entity, you lack the brand recognition to organically attract customers familiar with Uber or Lyft. Investing in promotional deals to incentivize app downloads is imperative until reaching scale.

Competing on price also gets far more complicated against intensely competitive rideshare rivals. Sacrificing too much margin is unsustainable, but failing to battle on affordability risks losing riders.

Steps for Transitioning Your Taxi Company Online

While obstacles do exist in digitizing your taxi business, none are insurmountable. Let’s walk through the step-by-step process for making the switch:

Step 1: Research software dispatch providers and features 

With Uber as the template, ride-hailing apps have become available as white label solutions for taxi companies. Assess platform options to understand capabilities that best suit your needs regarding functionality, fleet size, IT requirements, and costs.

Step 2: Survey drivers and customers

Before selecting a vendor, collect feedback from cab drivers and regular patrons. Inquire their feature preferences and pain points to address through digital migration. Factoring their needs into platform selection and design avoids dissatisfaction later.

Step 3: Set development timeline and budget

Scoping the timeframe and investments demanded is crucial next. How long will building integrations and testing reasonably demand before officially launching your branded platform? How do upfront and ongoing expenses compare between prospective taxi app providers?

Step 4: Choose provider solution and integrate

With market research completed, picking the right taxi management software vendor to partner with is the leap of faith! Coordinate your administrators and developers to connect capabilities with inventory management, payment processing, reconciliation and payroll systems.

Step 5: Design app interface

Ensuring your ride-hailing app's user interface promotes seamless experiences is critical as well. Rely upon user testing groups to refine pain points in the passenger and driver interfaces. Using familiar icons and optimal information architecture avoids confusing first-time users.

Step 6: Train taxi drivers on app usage 

Your fleet should undergo immersive training for utilizing driver versions of the app. Cover step-by-step navigation, managing rides and bookings, communication with dispatchers and troubleshooting problems. Mastery by those directly interfacing with riders is essential.

Step 7: Market online platform launch

With the technology primed, marketing efforts take focus to announce your taxi company is launching an app alternative for digital bookings. Promotional discounts can help attract initial users and reviews. Search engine and social media advertising should emphasize your localized area advantages over mega-players like Uber or Lyft.

Step 8: Run beta test phase

Before an official wide release, have a group of drivers and customers pilot the app for several weeks. Encourage beta users to report problems or confusing aspects. Refine lingering tech glitches and simplifypoor app flows based on their real feedback.

Step 9: Continually update capabilities

Taxi apps constantly evolve with new features and solutions. Commit to steadily upgrading functionality once established to keep attracting customers. Listen to user reviews and monitor metrics to guide improvements addressing dissatisfaction or early signs of decline.

Embracing the Digital Future

Consumers overwhelmingly demand technology empowering convenience, transparency and options. That’s the reality facing taxi companies as mobility behaviors shift.

Digitizing your dispatch and reservations is daunting but ultimately necessary to stay competitive. The costs incurred pay dividends through access to new customers, powerful analytics and revenue diversity. Streamlined coordination simultaneously makes staff more productive.

While rideshare unicorns have disrupted the scene, they also provide a template for adapting. Joining the digital ecosystem around app-based taxi bookings frustrates inertia cementing decline. Meeting customer expectations for online coordination is the only path ensuring your cab company’s survival. Though the transition requires real work, taking your taxi business online promises sustainability.