Presented by: Taj Zadhra-Ogunsola
Afro Technologies ® Nigeria 2014 ©
Competitive Analysis
2
Afro Technologies competitive analysis assesses Lagos taxi service market. The analysis focuses on three core areas of Afro Technologies business - ‘technology’, ‘service’, and ‘innovation’ forms the key goals. As a new company entering a market with strong competitors, extra efforts needs to be made to weigh the threat and opportunities. Thereby enabling the organization to position the business to compete favorably in cities across Pan-Africa.
Technology Technology must be developed and designed with users in mind. Therefore, a friendly UX/UI that’s easy to navigate, easy to use but simplifies a process in any market operating a mobile taxi service.
Service Provide an experience different from traditional taxi service. It must seek to win customer loyalty on service offered; service promised; service experienced; and service delivered where consistency is imperative.
Innovation Innovation is setting a foundation and giving customers a virtual price haggling experience they can relate with, across different cultures to differentiate the product and service globally.
Information in this presentation is a competitive landscape for the marketing team to devise an appropriate strategy that favors Afro Technologies. Furthermore, position the business in the premium segment to aggressively combat their main competitor for market share to drive growth and sustainability going forward.
Afro Technologies ® Nigeria 2014 ©
Agenda Competitive Analysis
Technology Services Innovation
Help customer hail a taxi electronically by connecting drivers to them and allowcashless payment methods in-line with CBN laws.
To offer the service in as many cities across Africa, with the aim of expanding into Europe or America once Lagos becomes financially profitable.
The brand aim to compete with it main rival by position the brand into the high-end taxi service given customers much needed taxi service offerings such as ‘Taxi’-Standard, , ‘Private’- Executive and ‘Lux’s’- premium car service.
App New Cities Options
Current SituationInternal issues – Technology
Afro Technologies ® Nigeria 2014 ©
It’s mobile Convenient
ComfortableCashless
(future UPS)
Current SituationWhy would customers use Afro Technologies AfroCab?
Technology Services Innovation
Afro Technologies ® Nigeria 2014 ©
Cloud Computing(use locally or globally)
Application (not a call centre/agent)
Web-based Apps (Services &
Mashups Software as Service Cloud Computing)
Mobile App
Current SituationAccessible
Technology Services Innovation
Afro Technologies ® Nigeria 2014 ©
Transportation Application AfroCab Future Products
Afro Technologies ® Nigeria 2014 ©
Current SituationService by Afro Technologies
?
Technology Services Innovation
Current SituationInnovation Process
Technology Services Innovation
Afro Technologies ® Nigeria 2014 ©
Primary Strategy Secondary Strategy
Primary strategy is services that improves traditional norms of how transportation is
used by incorporating technology applications to simplify its purpose.
AfroCab’s digital marketing will include Google’s Ad-Sense and Yahoo Ad-Sense to
increase potential ride requests.
Differentiation Factors are as follows:Product knowledgeBrand cultureBrand communicationThe teamGrowth process
Current SituationDifferentiation
Afro Technologies ® Nigeria 2014 ©
Secondary strategy is to focus on related product/service across the African global by
creating demand-based services within carrier logistics, breakdown services, laundry
services, and car sharing service as the market requires it.
Focus on refining the technological product experience’s interface for better look and
feel of the brand culture and inline with charging consumers needs as well as
technological developments.
Current SituationInnovation
Primary Strategy Secondary Strategy
Afro Technologies ® Nigeria 2014 ©
Partnership Route Sponsorship Alliances
Forming strategic partnership will drive the business to compliment the brand whilst
building long-term customer loyalty across service categories to benefit customers.
Strategic alliance are as following:
Creating Pan-African PartnershipInvest in custom application Flexible API for corporate client requirements Celebrity endorsements to strengthen brand and grow customer base
To positively positioned the brand in the minds of clients using available opportunities.
Current SituationPartnership Alliances
Afro Technologies ® Nigeria 2014 ©
Digital age has challenges - the tyranny of ‘more’
Marketing is the only public function
Ready, Fire, Aim - experience is better than planning
80/20 rule
Avoid the short-term trap
Marketplace results matter most
ROI total vs. Individual totals
What is new vs. Last year
Balancing Afro Technologies Innovation
Current SituationBalancing Innovation, Results & Predictability
Afro Technologies ® Nigeria 2014 ©
Strengths Weaknesses Opportunities Threats
Visionary leader Financial Expertise'sMobile tech-productsAfrican readiness for
ePayment channels
Technology applicationHigh price of vehicle
leases Limited market data in
some African cities Unknown brand nameManagement control
New middle-class growth Launching new serviceCheap Labour marketPotential tourist marketDevelopment of social
media/social networkGrowing consumer
markets
Uber (competitor) Access to FinanceMobile devices usedCultural & Political
issues Economic down turnsRoborts
SWOT Analysis
Current SituationSWOT analysis
Afro Technologies ® Nigeria 2014 ©
Competitive Analysis
Market Development Strategy
Diversification Strategy
Market Penetration Strategy
Product Development Strategy
Existing market New market
Exis
tin
g p
rod
uct
N
ewp
rod
uct
Market Penetration Strategy
(MPS) is selling existing products
to the present market. This
strategy is applicable but is likely
to change when the business
expands across the Africa market.
Furthermore, this would open
opportunities for the business to
attract potential investors.
Current SituationAnsoff matrix
Afro Technologies
Afro Technologies ® Nigeria 2014 ©
Geographics
Main Cities Growth cities across Africa Lagos 6.4% of Nigeria’s population live in this cityAbuja FCT 1.0% of Nigeria’s population live in this cityPort Harcourt 2.6% of Nigeria’s population live in this city
Launch City Lagos with 21m population
Growth 2nd-fastest growing city in AfricaDemographics
Male pop. 51% Female pop. 49%%
Age Young Career Adults (26-40) 39%Professional Adults ( 41 – 50) 19%Matured Management Adults (50+) 10%
Income Low Income (above Naira NGN100,000 p/m)Middle Income (above Naira NGN350,000 p/m) Higher Income (above NGN 550,000)
Product: AfroCab Taxi Services
Source: WPR World Population Review 2014Strategy Nigeria, Renaissance Capital, 2011
Young Adults 26-4039%
Adults 41-5019%
Matured Passengers51
+10%
Others 32%
AfroCab’s Target Customers
Young Adults 26-40
Adults 41-50
Matured Passengers51+
Others
Market Segmentation
Current SituationMarket segmentation
Afro Technologies ® Nigeria 2014 ©
15
Target market
Age group: 30 – 51+
Lifecycle: Young adults/Adults & Matured
Gender: Male and Female
Occupation: Middle-class university students, persons in managerial, executive, and professional positions.
Income: Middle and higher income earners
Target Locations Main cities (Ikeja, Ikoyi, Surulere, Victoria Island, Lekki (1-6 arounds) Ikeja GRA, Airports (Domestic/international) Lagos Island business areas, local jetty points shopping malls, train stations Main Land, Lagos Island, and outer Lagos (anywhere within 30-40 mile range).
Target
Afro Technologies ® Nigeria 2014 ©
Current SituationAfroCab Target Market
Afro Technologies ® Nigeria 2014 ©
Customer-Oriented Service Provider AfroCab Users in detail
Name Size Revenue Problem Solution
Young Career Adults 30- 35 y.o with an Income aboveNGN100,000 p/m), works in the city centre
Smartphone Users Device: Android Tecno/Blackberry Q5/Q10Cities: Lagos, Port-Harcourt or Abuja
Represent 35% of our market interest
Our Young Career Adults spend on average of NGN2,500 on rides p/w
Late to work or needs a taxi but doesn’t want to stand outside to hail for one.
Hailing a taxi electronically without sweating in public.
Targeted product; ‘Afro Standards’
Adult Professionals 35 – 40 y.o. with Income ranging above NGN350,000 p/m, works in the city or is self employed
Tech-Savvy Users Device: Android Samsung /Apple iOS 5sCities: Lagos, Port-Harcourt or Abuja
Represent 45%of our market interest
Our Adult Professionals spend on between NGN3,500-NGN4,500 on rides p/w
Works in the big city, and married with 2.4 children owns a used car but only drives at weekend. Has access to company pool car during the week but uses taxis regularly for convenience.
Requires a taxi service ASAP but worried about the state and condition of the vehicle. They are tech-savvy mostly but want a comfortable ride.
Targeted product; ‘Afro Executive’
Matured Management Adults 41 - 50+ y.o. with Higher Income above NGN 550,000 or more, owns two or more vehicles but dislike driving when driver is not around.
Business Users Device: Apple iOS 5s/Windows Lumia range/Android High-end Samsung or HTCCity: Lagos or Abuja
Represents 20% of our market interest
Our Matured Management Adults spends on between NGN6,500-NGN7,500on rides p/w
Dislikes any form of disruption and is willing to pay for a premium service to maintain the status-quo.
On-demand services is second nature to them. They prefer no questions asked but wish to reach their destination without paying cash.
Targeted product: ‘Afro Lux’s’
Afro Technologies ® Nigeria 2014 ©
Customer-Oriented Service ProviderCustomer Segments
Cu
sto
mer
Seg
men
t
This customer segment is divided into two groups rather than three. ‘Tech-savvy’ and ‘business users’ are one demographic but are targeted differently, using two separate service categories (Afro-Executive and Afro-Lux’s).
Smar
tph
on
e ta
xi u
sers
The smart taxi users mainly uses taxi services for airport trips; shopping; eating out; going to bars or nightclub; business appointments; and generally anytime when driving is not the preferred option.
Tech
-Sav
vy a
nd
Bu
sin
ess
Use
rs-
Uses taxis because: personal driver is off duty, and it is too late to have a family member pick them up or too intoxicated to drive.
Frequent taxi users with smartphones, opened to technological changes, and considered ‘early adopters’ with positive traits for market entry,
People who have smartphone People accessible to big cities
People who don’t mind spending more for reliable and convenient services
People who work professionally (new middle-classes’)
People who like change as the way forward
People who move around 24/7 People who dislikes traditional
taxi services and prefer the mobile app version for simplicity
Segmentation
Afro Technologies ® Nigeria 2014 ©
Customer-Oriented Service ProviderSegments by Trip type and by User Type
Segment by Trip Type:
Inter city point to point – the traditional 8 hrs. or 4 hrs. charter service.
Intra city – daily usage.
Airport drop-offs.
Segment by User Type:
Smartphone Users - Young Career Adults (individual
personal travel – (retail)
Tech-Savvy Users - Adult Professionals (for meeting,
going places and airport drop- offs and OTA – online
travel aggregators)
Matured Management Adults - Business Users
(corporate business travel/companies and third-parties
offering the service to their direct client/customers).
Afro Technologies ® Nigeria 2014 ©
Afro Technologies' offers a low cost pricing strategy where the company bears no financial costassociated with running a taxi operation, government fees, unnecessary employees (driver) or itsvehicle maintenance overheads.
Specifically:No inventory No fees as a “taxi service operators” No toll gate chargesNo drivers pays any Afro Technologies any fees to deliver the serviceconnect passengers to drivers from a large pool Drivers are our partners not employees
Attractiveness:Ease of becoming driverWork when you want Constant jobs at your footNo pressure, you’re your own boss Drivers on the network can accept lower revenues than normal taxi drivers
Competitive AnalysisUnique value proposition
Afro Technologies ® Nigeria 2014 ©
Afro Technologies Local Taxi/Car Hire Companies
Advance Booking No Yes
Hiring Method Smartphone App Flag/Call Centre/Dedicated taxi queue
Payment Cash/Credit card Cash
Driver/Passenger Rating Available NA
Pricing Structure Negotiable/ Flexible Structured
Fare Sharing Anyone Limited to friends
ETA to Destination Available NA
ETA of the Ride Available Available (Apps Only)
Car Self Rented from Taxi Company
Driver’s perspectives Flexible Rigid
Law & Regulation (more on this later) Grey Area Well-defined
Value Capture to Company Commission Fe Rental Fee, Advertisement
Competitive AnalysisAfro Technologies VS Taxi
Afro Technologies ® Nigeria 2014 ©
021
Competitor/As a Brand Quality Price/fare Service Awareness
AfroCab (Afro Technologies) Poor Average Poor Poor
Afro Taxi Segment Good Excellent Average Poor
Afro Comfort Segment Poor Average Average Poor
Pure Lux’s Segment Bad Poor Average Poor
Uber (Uber Technologies) Excellent High Very good Very good
UberBlack Segment(Locally)
High HighVery good (locally)
Very Good
Easy Taxi (as a brand) Average Very Good Poor Average
Taxi/Private Good Average Very good Average
Competition
Awaiting time
Poor
Poor
Poor
Poor
Excellent
Poor
Average
Average
Competitive AnalysisCompetition
Afro Technologies ® Nigeria 2014 ©
Afro Technologies VS Taxi Pricing Structure
Afro Technologies
- Base fare - Negotiable - Fares based on distance and competition- Surge pricing (toll gate only)
- NA
Taxi
- Base fare - None metered fare based on distance- Additional cost
- Peak hour / midnight surcharge- Public Holiday surcharge - Advance booking fee- Presentation based surcharge - Tool Fee surcharge- Area based surcharge - Airport - City
Afro Technologies ® Nigeria 2014 ©
Competitive AnalysisCompetitor’s unique value proposition against AfroCab Product
Afro Technologies ® Nigeria 2014 ©
Competitor’s StrengthsCompetitor’s unique value
propositionCompetitor’s Weaknesses
Incumbent: Recently raised Series C funding for $307 Million,
mostly from Google, at a valuation of $3.5 Billion.
Best funded and highly innovative company
Present in 50 cities in North America, Europe, Asia-Pacific.
Payment through credit card only, splitting of fare option,
vehicle selection. Costs depend on demand.
Revenue is based on percentage of fare, time and mileage.
Great selection of robust
service offering at a
premium price.
Excellent global brand
appeal to High Life Seekers
Limited African presence and understanding of the
local markets despite an aggressive push into
emerging markets
Testing the waters in Cape Town, Johannesburg and
Durban, with limos only
Business Model not entirely adaptable to the whole
of Africa
Strongest on high end limo service, not well suited
for scale in African markets
Credit cards use very limited in Africa
Decision: Act
Challenger: Low cost; charges not more than 5% of total
revenue.
The company has raised $25 Million to date.
Network of more than 45,000 taxi drivers with presence in 41
cities across 14 countries, mostly in Brazil and the rest of Latin
America.
Has announced intention to enter Africa, including Nigeria.
Has the best understanding of emerging markets of all the main
players.
Parallel user experience to
AfroCab targeting taxi and
private passenger segment
(with rebranding and new
user experience AfroCab
can overcome this).
Like the others, focused largely on the formal taxi
market, which limits scope
Application functionality similar to competitors
With 7.2% YoY growth, Easy Taxi is the category thought
leader
Decision: Act
OGA TAXI
Afro Technologies ® Nigeria 2014 ©
Competitive AnalysisCompetitor’s unique value proposition against AfroCab Product
Wanna-be competitor Propositions Response
Incumbent: Oga Taxi is new to the market and offers
nothing new with no market share.
Average licensed taxi app technology (Taxi Hawk) that
lacks UX, UI and brand personality.
Oga Taxi, operates in Abuja. The company may pose a small threat to
the business.
Challenge: Threat to Abuja space and ‘Afro Taxi ‘TA segment
Decision: Monitor
Incumbent: SayTaxi has a small but unique TA but this
is hard to determines
Say Taxi's UX and UI experience is pretty impressive in
the interaction between the passenger and the (app)
product.
The company operates in over 25 countries with a
global presence.
Strategy is to act slowly by fitting in culturally but is likely to deploy an
aggressive Market Penetration campaign to increase market in
AfroCab’s space - Lagos.
Challenge: ‘Afro Taxi ‘and ‘Afro Comfort’ TA segment
Decision: Act immediately
Challenger: Tranzit is a low value Taxi, car hire and
carrier service. It has a growing target audience unique
to their service offering but not significant enough to
disrupt AfroCab’s market space.
Implemented a diversification strategy to serve three
sectors from passenger to carrier transportation.
Spends minimum amount on passenger acquisition and
brand awareness to grow market.
Likely to steal our market and TA in Lagos, if they are successful with
additional venture funds, can become a real competitor.
Challenge: ‘Afro Taxi ‘TA segment
Decision: Close monitoring
Strengths
Has raised over $50.6 Million to date. Available in 14 cities including London, Barcelona, Madrid,
Boston, Chicago, New York and Tokyo. Both cash and card payment accepted. Interested in emerging markets but is focused on launching
in some Asian markets first and preoccupied with regulatory issues in the US.
Weaknesses
Limited Global presence Application functionality similar to competitors; no real
differentiation Focused only on regular metered cabs, therefore unsuited to
African markets
Minor players in parts of Africa include SnappCab (South Africa), Tranzit (Nigeria).
Unique Selling PropositionsDefining the Customer - AfroCab
Drivers and passengers are thetwo most important customers toAfro Technologies.
‘The Diamond Effect’,demonstrates their impact to the business and how each corner of the diamond generates an income for the growth of the company.
The Diamond Effect
DriverPassenger
Afro Technologies ® Nigeria 2014 ©
Cost based pricing
•Cost plus pricing/basic cost covering
•Contribution pricing
•Working back method/ expected return
Market oriented pricing/demand
based pricing
•Transparent pricing
•Market skimming
•Penetration pricing
•Price to meet customer expectation
•Free rides, discount & sales
Competition based pricing
•Destroyer pricing
•Price matching
•Price bidding
They are three basic pricing strategy as suggested in the
diagram across. However, a review of our product service
indicates the company will benefit by applying a pricing
strategy based on volumes of completed and requested rides.
Hence, the reason ‘market oriented and demand pricing’ has
been selected, based on the nature of the business.
Currently, monthly expenses cannot cover revenues
generated working on a ‘flat’ 10% commission. AfroCab’s
commission is lower than competitors operating in the same
city (Lagos). A review upward (20%) is imperative to sustain
long-term financial returns. Furthermore, the more rides
completed the likelihood of incurring additional marketing
cost.
Competitive AnalysisPricing strategy
Afro Technologies ® Nigeria 2014 ©
Pricing strategy Value Based Pricing- AfroCab
Total
22
3
Rated from 0 to 5 max
0
5
10
15
20
25
30
1- Overall brand 2- Customer service 3- Experience 4- Premium product Total
Comparison of attributes of AfroCab against competition
Afro Technologies Uber
Afro Technologies ® Nigeria 2014 ©
Pricing strategyValue Based Pricing – AfroCab
Total
4
10
4
0
5
10
15
20
25
Speed Comfort Cleanness Friendliness Total
Comparison of attributes among Lagos transportation options
BRT Buses AfroCab Local taxi
Speed Comfort Cleanness Friendliness
AfroCab 3 2 2 3
BRT Bus 1 1 0 2
Lagos Taxi 2 0 1 1
Rated from 0 to 5 max
Afro Technologies ® Nigeria 2014 ©
Afro Technologies VS Taxi Driver’s Perspective
Afro Technologies
- Requirements - No professional taxi license required - Use your own vehicle
- Income - Flexible timing – part time work - Surge pricing may provide higher hourly
wages
- Expenses - Petrol - Personal insurance - Maintenance of personal vehicle
Taxi
- Requirements - Professional taxi license /
“medallion”
- Income - Full time work (i.e. cover daily
rental work) - Fixed surcharges
- Expenses- Fixed rental fees payment - License fees payment as a taxi
driver
Afro Technologies ® Nigeria 2014 ©
Drivers
- Partner Loyalty rewards program
- Possible Vehicle Financing Possible discount Car Insurance
- Possible Life & Health Care insurance for partners
- Ride growth Incentives
Customers
- Partnerships with local establishments e.g. restaurants, shops
- Price promotions- Sponsorship Activities- Celebrities involvement - Service offering (Wi-Fi)
Retain & Gain New
Afro Technologies VS Taxi Strategic control
Afro Technologies ® Nigeria 2014 ©
Adopted using Uber’s Strategic Control concept.
ThankYOU!
Top Related