On Wednesday, millions of married women across northern Indian States will observe karva chauth, the traditional festival that is intended to channel cosmic forces in the cause of ensuring longevity to their respective spouses.

Body self-adornment with mehendi is an ornamental part of this festival of faith, and the services of mehendi artists typically come at a premium.

To tap into that niche market, India’s pioneering taxi aggregator Ola is offering an uniquely Indian service: it will ferry mehendi artists to the homes of women who enrolled as on Tuesday evening.

That’s just an illustration of Ola’s ongoing effort to find emotional resonance with its customers as it goes head-to-head with its primary rival Uber, the global pioneer of the taxi aggregation business.

There’s a sense of perpetualmotion, symbolising a ceaseless energy, about Ola’s every move, and the partnerships it has built up to leverage its brand. Which is entirely appropriate, given that mobility is something of a business mantra with the company. Ola, of course, adopted the business model introduced in the West by Uber, but gave it a desi tweak to rule the Indian roads.

In the six years since it launched in 2010, Bengaluru based Ola has expanded to take in 5.5 lakh ‘drive partners’, and is today valued at $5 billion.

Having disrupted the Indian cab market with its on-demand taxi service, it has expanded the universe of its offerings to include autos, motorbikes — and even office charter buses.

And today, it is waging a relentless street battle with Uber for customers, who are discovering anew the joy of city commuting.

“We began with trying to solve the problem of unutilised inventory (of taxis) and connecting endusers by leveraging technology. That was the concept around which the entire development happened,” says Ola COO Pranay Jivrajka.

Ola’s founders — IIT graduates Bhavish Aggarwal, CEO, and Ankit Bhati, CTO — realised that understanding the behaviour of both users and drivers was paramount. And to reduce the idle time, ondemand booking was needed.

The disruption In an era when cabs had to be booked at least two hours in advance,

Ola introduced just-intime service on demand Cabs, once booked on the Ola app, would arrive in 15minutes — and since 2012, that response time has been cut down to five to ten minutes, depending on the location and taxi availability .

“Switching from booking in advance to on-demand was the major inflection point for us. Earlier, drivers would travel even 15km to pick up customers. The scale developed due to adequacy of supply, which in turn brought in demand,” adds Jivrajka.

The other strategy that scored for Ola was the rollout of services beyond the metros. “We understood that reasonably priced cabs were needed in small towns too,” he says.

However, the uneven spread of telecom technology posed a challenge GPS facility and 3G networks which are typically needed to make app bookings, were virtually non-existent in Tier II and Tier III cities.

“So we optimised our app and made it useable on 2G networks. Today, our app even works offline, using SMS.”

Mobility mantra

For Ola, the key word is mobility. “There is a need for mobility at different price points. We want to build mobility for Indians. There are ways to bring costs down and yet remain sustainable,” claims Jivrajka.

Capitalising on its learnings, Ola has expanded to aggregating auto-rickshaws, e-rickshaws, shared bikes, office charter buses and even Mumbai’s iconic kaalipeeli (black-and-yellow) taxis.

Within the cabs segment, Ola has introduced multiple options. “Two years ago, we only offered a Mini or a Sedan. Today, there are eight-nine categories that provide customised experience,” says Jivrajka. Riding on momentum, Ola has started up a whole range of other products, the most recent of which is Ola Outstation. It has also built co-branded relationships as mobility partner with events patronised by the young, including with Comic-Con and Sunburn festival. It has grown the brand innovatively through partnerships with, among others, the OnePlus range of smartphones, which became available by invitation only.

Ola passengers got a hands-on experience of OnePlus 2 during their rides; the phones were hand-delivered in an Ola cab.

Similarly, Ola tied up with Kalyan Jewellers for the dhanteras festival: cabs would pick customers up and take them to an outlet of the jeweller; customers also won a voucher for a onegram gold coin

Most recently, Ola began offering its Prime passengers a virtualreality experience during the cab ride, in collaboration with Flipkart and Lenovo Vibe K5 Note sets.

The challenge

Backed by Tiger Global, SoftBank and Chinese taxi-hailing service Didi Kuaidi, Ola has established itself in the taxi aggregation market. Yet, its business model is fraught with challenges, particularly since competition has compelled it to drive fares lower and lower. Ola Micro, for instance, offers rides in air-conditioned cabs at ₹6/km.

Jivrajka, however, reckons that this isn’t a concern for now

“Our pricing across categories is sustainable. We kept prices low owing to competition, but given the supply constraints, we don’t see the need to further reduce fares. Our gross revenues continue to increase, with scale and efficiency,” he claims.

But there is some chatter about increasing fares, and perhaps lowering incentives offered to drivers. Ola faces a challenge in keeping drivers hooked onto its platform in the face of rising competition.

“Drivers are not very loyal to the company, given the pressure to complete more trips to earn higher commission,” says VG Ramakrishnan, MD and managing partner, Avanteum Advisors.

Equally, customers too are not brand-loyal, if they get a lower fare from a rival. “Other copycat aggregators may come in to fight for market share. Ensuring vehicle availability 24x7 in newer geographies will be a challenge,” adds Ramakrishnan.

For now, though, Ola has made a mark in the taxi aggregation market and has secured investments from marquee investors.

Along the way, it has acquired rival TaxiForSure and is looking to turn a profit. “We can be profitable tomorrow, but it is about investing in the right place: getting more cars and the next set of drivers,” says Jivrajka.

On that long road to profits Ola, it appears, cannot afford to step on the brakes just yet

With inputs from Chitra Narayanan

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