Uber City Plan - Novosibirsk
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Transcript of Uber City Plan - Novosibirsk
NOVOSIBIRSK
by Anton Sazansky
December 2015
Capital of Siberian region
A young and vibrant transportation hub with a favourable business climate
2
NOVOSIBIRSK
1.5m population. 900k employed
City area: 506 sq km
Over 800k registered vehicles
178 registered taxi operators
40k-60k requests – total Daily Demand
9 522 taxi licenses issued
90% of drivers operate without license
Sources: wikipedia, 2gis, ksonline
INCUMBENTS REGISTERED DRIVERS
OWN FLEET CARS CORPORATE CLIENTS BASE FARE FLEXIBLE FARE PAYMENT MOB APP
LEADER / RUTAXI 13 000 n/a n/a $1,54 $0,17 cash yes
GRAND AVTO 11 000 500 300 $2,31 $0,22 cash yes
ATLAS 6 500 n/a n/a $2,46 $0,17 cash yes
CLASSIC 800 50 100 $2,31 $0,15 cash yes
TAXI 102 500 70 50 $2,15 $0,15 cash/ card no
GETT* n/a n/a n/a $0,77 $0,28 cash/card yes
YANDEX TAXI 150 n/a n/a $1,22 $0,25 cash/card yes
Average $1,82 $0,20
Taxi market is dominated by 5 operators with 2 distinct leadersPricing, availability and customer service are the key drivers for demand
Source: nsk.dk.ru
3
70% market share
Competitors are targeting NovosibirskLaunch Uber this Fall to acquire market share and catch Dec-Jan demand surge
4
• Launched in June 2015
• Applied fixed fare of 1.5 USD across the Right Side of the City
• Rapidly gaining popularity in Novosibirsk
• Launched in Sochi, Samara, Rostov, Ekaterinburg and Krasnoyarsk on 7 Oct 15
• Launched on 27 Oct with 150 cars from Grand Avto and RNIC
• Tariff Economy- 79 rub + 16 rub / km
• Tariff Comfort - 195 rub + 17 rub / km (first 2km inc.)
• Planned to launch luxury private driver service this summer
• Currently service is not available in Novosibirsk
TIME min DISTANCE km LEADER GRAND AVTO UBER RUTAXI DIFF GRAND AUTO DIFF
7 2 1,85 2,31 1,27 0,58 0,31 1,04 0,45
11 4 2,00 2,31 1,58 0,42 0,21 0,73 0,32
15 6 2,08 2,46 1,89 0,18 0,09 0,57 0,23
18 7 2,54 2,77 2,10 0,43 0,17 0,66 0,24
21 8 2,77 2,92 2,34 0,43 0,16 0,59 0,20
23 10 2,69 3,08 2,52 0,17 0,06 0,55 0,18
24 13 4,08 4,15 2,76 1,32 0,32 1,39 0,34
35 16 4,15 4,46 3,52 0,64 0,15 0,95 0,21
35 17 4,08 4,62 3,57 0,51 0,12 1,05 0,23
36 12 3,46 3,85 3,35 0,11 0,03 0,49 0,13
36 14 3,54 3,85 3,46 0,08 0,02 0,38 0,10
39 19 4,85 5,38 3,89 0,95 0,20 1,49 0,28
46 25 5,77 6,00 4,59 1,18 0,20 1,41 0,23
Ave $3,37 $3,70 $2,83 $0,54 16% $0,87 24%
WED 16:22 TRAFFIC: 4 POINTS
Launch UberX at 0.77 USD base + 0.05 USD km/minBuy market share by pricing 15-25% below competitors
Sources: Yandex maps, Leaader and GA mob apps5
FARES Oct Nov Dec Jan Feb Mar
Flexible RUB RUB3,50 RUB3,50 RUB4,00 RUB4,00 RUB4,00 RUB4,00
Flexible USD $0,05 $0,05 $0,06 $0,06 $0,06 $0,06
*Ave. UBER fare RUB
RUB184 RUB184 RUB203 RUB203 RUB203 RUB203
*Ave. UBER fare USD $2,83 $2,83 $3,13 $3,13 $3,13 $3,13
6
Launch with 2 months promo fare to buy market share
* Excluding surge pricing
TOTAL DEMAND AVE Day Week Month
REQUESTS 000 47 320 1 280
TOTAL DEMAND Mon Tue Wed Thus Fri Sat Sun TOTAL
REQUESTS 000 35 40 40 45 60 55 45 320
Total demand for cab service is 40k-60k requests / day
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UBER REQUESTS
DEMAND ACQUISITION TARGETS 6m 12m 36m
TIME 10% 17% 31%7-9 am 279 474 865
9-5 pm 1 579 2 684 4 895
5-7 pm 376 639 1 166
7-11 pm 1 153 1 960 3 574
11-1 am 924 1 571 2 864
1-7 am 389 661 1 206
REQUESTS / DAY 4 700 7 990 14 570
REQUESTS 000 / MONTH 132 224 408
Generate 51k Sign ups to achieve 6m demand aquisition target
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SIGN UPS ESTIMATION 6m
Rides / month 1 3 7 10
*Total users % 54% 29% 14% 3%
*Total requests % 22% 26% 32% 20% TOTAL
UBER #Sign Ups 000 29 16 6 1 51
Total taxi users 000 282 151 73 16 521
* Yandex Taxi usage pattern Moscow 2013
SIGN UPS GENERATION 6M Oct Nov Dec Jan Feb Mar
Sign Ups % / month 6% 12% 26% 22% 18% 16%
Sign Ups 000 / month 3 6 13 11 9 8
UTILISATION trips / 1hr 1,2 1,2 1,4 1,4 1,3 1,3
FULL TIME 6 days/week - 12 hrs/day
Oct Nov Dec Jan Feb Mar
% of all Drivers 40% 43% 47% 50% 53% 57%Trips / day 14 14 17 17 16 16Peak trips/day 7 7 9 9 8 8Off peak trips/day 7 7 8 8 8 8
PART TIME 4 days/week - 6 hrs/day Oct Nov Dec Jan Feb Mar
% of all Drivers 60% 57% 53% 50% 47% 43%Trips / day 7 7 8 8 8 8Peak trips/day 4 4 4 4 4 4Off peak trips/day 3 3 4 4 4 4
DRIVER BONUS Oct Nov Dec Jan Feb Mar
Peak bonus /trip USD $1,54 $1,54 $1,08 $1,08 $0,92 $0,92Off Peak bonus /trip USD $0,46 $0,46 $0,31 $0,31 $0,23 $0,23
SUPPLY Oct Nov Dec Jan Feb Mar
New Drivers / week 10 17 21 24 26 28
Onboarding drivers and estimating their work schedules
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FREE RIDES ESTIMATION Oct Nov Dec Jan Feb Mar
TOTAL COMPLETED 000 7 18 41 65 86 116
* FREE RIDES (ave 36 %) 63% 51% 39% 27% 21% 15%
* FREE RIDES 000 4,2 9,3 16,0 17,5 18,0 17,4
FREE RIDE COST usd/trip $3,85 $3,08 $2,31 $2,31 $2,31 $2,31
Free ride should gradually decrease over time period
10
Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 TotalWeek 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 6m
DRIVERS 20 30 40 50 67 84 101 118 139 160 181 202 226 250 274 298 324 350 376 402 430 458 486 514 514
DRIVER CHURN 8% 2 2 3 4 5 7 8 9 11 13 14 16 18 20 22 24 26 28 30 32 34 37 39 41 Target
TRIPS (000) 1,0 1,4 1,9 2,4 3,3 4,1 5,0 5,8 8,3 9,6 10,9 12,1 14,0 15,5 16,9 18,4 19,2 20,7 22,2 23,8 26,4 28,1 29,9 31,6 10%
(000 USD)
GROSS REVENUE 3 4 5 7 9 12 14 16 26 30 34 38 44 48 53 58 60 65 70 74 83 88 93 99 $1 033
Uber split 20% 0,5 0,8 1,1 1,4 1,9 2,3 2,8 3,3 5,2 6,0 6,8 7,6 8,7 9,7 10,6 11,5 12,0 13,0 13,9 14,9 16,5 17,6 18,7 19,8 $206,63* Surge split 20% 0,1 0,2 0,2 0,3 0,4 0,5 0,6 0,7 1,2 1,4 1,6 1,7 2,0 2,2 2,4 2,6 2,7 2,9 3,1 3,3 3,7 3,9 4,1 4,4 $46,28
NET REVENUE 1 1 1 2 2 3 3 4 6 7 8 9 11 12 13 14 15 16 17 18 20 22 23 24 $253
COST OF SALES 3 5 7 8 9 11 13 15 13 15 18 20 19 21 23 25 20 22 24 25 25 26 28 29 $422
Free Rides Cost 2 3 5 6 5 6 8 9 8 9 10 11 9 10 11 11 9 10 11 12 9 10 10 11 $204Driver Bonus 1 1 2 2 3 4 5 6 6 7 8 9 10 11 12 13 11 12 13 14 15 16 17 18 $218
GROSS MARGIN - 3 - 4 - 5 - 7 - 6 - 8 - 9 - 11 - 7 - 8 - 9 - 10 - 8 - 9 - 10 - 10 - 6 - 6 - 7 - 7 - 4 - 5 - 5 - 5 -$169S&M 4 4 4 4 4 4 4 4 3 3 3 3 3 3 3 3 2 2 2 2 2 2 2 2 $72
G&A 3 3 3 3 3 3 3 3 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 $56
EBIT - 10 - 11 - 12 - 14 - 13 - 15 - 16 - 18 - 12 - 13 - 14 - 15 - 13 - 14 - 15 - 15 - 10 - 10 - 11 - 11 - 8 - 9 - 9 - 9 -$297
6m Weekly Earnings Forecast
*Average surge rate taken as 40%11
6 770 registered Sole Traders (ST) account for less than
10% all drivers in the City
Shadow drivers push out licensed taxis from the street Physical threats and property damage are not uncommon
City is split into sectors by shadow drivers’ controlling groups
Licensed drivers attracted to going back into shadow to reduce costs and tax payments
Uber brings transparency and safety to City transportation
system
Absence of regulatory oversight provides no incentive for drivers
Around 90% of City drivers operate without taxi license
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Current Legislation Proposed Legislation
76 USD fine for not having a license
Mobile platforms are not covered
Lack of control over law execution
Does not mandate drivers to obtain licenses
460 USD fine for not having a license
Mobile platforms classified as “telecom services” Responsibility for obtaining license put on drivers
Does mandate drivers to obtain licenses
Lack of regulation provides scaling opportunities for UberProposed legislation to tackle shadow drivers due for government review this Fall
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Drivers and Riders safety
Drivers may be assaulted by criminal elements controlling major transportation hubs.
Introduce driver emergency button. Driver screening and background checks.
Taxi licencePolice raids aimed at shadow drivers. Fines and driving license confiscations.
Oblige new drivers to obtain permits via Uber partners. Assist drivers in obtaining license.
Taxi lobby push back
Fiscal, antimonopoly and police checks on Uber Taxi lobby may adopt collusion policy.
Educate policymakers about Uber business model and vision. Implement “too big to fail strategy”.
Unclear legal framework
New laws may be introduced to put more pressure on Uber.
Collaborate with Mininstry of Transport to implement sensible, safety-based ridesharing regulations.
Surge pricing Angry riders
Severe surge pricing may occur due to extreme weather conditions in winter.
Address negative attention via social media channels.
Competitors Imitators
Increasing competition may boost driver churn. Harder to acquire market share from increased competition.
Retain competitive bonuses for drivers. Raise fares or surge pricing. Build community among drivers.
Safety issues and licensing are the biggest challenges
14
Uber
20% split
Customer service
Marketing
S&D management
PR / GR
Product management
Training
Drivers’ examination
Uber Partner Entities
5%-10% split
Source drivers
Licensing
Training
Docs/Background checks
Leasing
Drivers’ examination
Drivers
70%-75% split
Driver services
Car rental agreement
Customer service
Referrals
Uber partners to onboard drivers and provide licensing assistance Motivate full time drivers to become ST and connect directly
15
1. Economic effect: creating new jobs in the City
2. Transport system effectiveness: high density coverage, availability, decreasing congestion
3. Safety: bringing down drink driving
4. Improving ecology: falling traffic congestion
5. Transparency: motivate shadow drivers to ride for Uber and obtain license
Educate city officials about Uber vision and business modelMeet Ministry of Transport and Transport Department of City Administration members
16
Supply scaling
• Taxi forums. Radio. Media.
• Partner with recruitment firms
• Reward full time drivers. Retention bonus.
• Motivate drivers to build career with Uber
• Referral bonus system
• Partner with car leasing companies. Buy out opportunity
17
Demand scaling
• Promote Uber in social media. Instagram, VK, Facebook
• Support local events and celebrations. Opera Theatre, Novosibirsk Expo Centre
• Partner with local HoReCa. Hilton, RosInter, Denis Ivanov, Food Masters
• Engage Uber for Business. City Administration, Sberbank, Beeline, Pharma
• Connect with Academpark. Co-working, Big MOBI Fest
• Celebrity ride. Achieve WOW factor
18
Engage companies into synergetic partnershipsUse high traffic venues to promote Uber
19
CUSTOMERUBER
TELE2
1st Free Ride
SMS with Uber app download link and promo code
Residual amount from 1st
free ride credited to
customer’s TELE2 account
Generate sign ups through synergetic partnership with TELE2
20
Register free business account with Flamp
Flamp emails invitations to its users with Uber
promo codes
Users ride Uber and leave their reviews/comments on Flamp
Users with the best feedback are rewarded
with Uber credits
Partner with Flamp.ru to generate Sign Ups
2 600 000+ visitors per month
21
22
TOO DRUNK TO DRIVE? THE CITY WILL CALL YOU AN UBER
14 Feb – Happy Valentine’s Flowers, chocolates, ice cream
23 Feb – Defender of Fatherland day Free rides for veterans
3 Mar – Pancake week Pancakes, honey, jam
8 Mar – Women day Flowers, chocolates, cosmetics
12 Apr – Cosmonautics day Planetarium tickets Free ride for every 108th rider
12 Apr – Happy Easter Chocolate eggs
9 May – Victory day Free rides for veterans
26 Jun – City day Fixed fare across city center
27 Jun – Youth day Condoms with Uber Logo
30 Oct – Mothers day Pampers, baby care products
31 Dec - Happy New Year Tangerines
Support local celebrations with on demand Uber deliveriesIncrease brand awareness and build a positive reputation
23
SHEREGESH- SIBERIA SKI RESORT -
The most popular ski
and snowboarding resort
in Russia
Over 1 mln visitors
each year
LAUNCH CAMPAIGN
SHEREGESHSiberian ski resort
UberHELI
Welcome to Siberia.
THANK YOU