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Hailo picks up speed as a digital disrupter for taxis

Tom Kaneshige | March 12, 2013
Like it or not, CIOs and other IT leaders will have to deal with a digital disrupter who wins over suppliers and customers by wringing out inefficiencies in the market. Mobile startups like Hailo and Uber, which match up passengers with transportation, are turning the industry on its ear.

Like e-markets of yesteryear, Hailo's biggest challenge is filling its network with both passengers and taxi drivers to make its service worthwhile for either party, known as liquidity. Most companies facing liquidity challenges start out with a handful of suppliers or even a single supplier, and then attempt to woo customers-much like a traditional business.

The thinking goes that if you fill your network with passengers, drivers will follow. But Hailo took the opposite tact, which Bregman attributes to Hailo's early success in London: He went after suppliers, or in this case, taxi drivers.

The worst thing you can do is have too many customers and not be able to meet demand, which leads to poor customer experiences, says Bregman. Bad customer experience kills mobile apps. Instead, Bregman gave taxi drivers value that's independent of incremental fares, such as social networking features that let them communicate with each other and identify troublesome traffic areas.

When customers initially try out the app, there's a good chance they'll have a positive experience, such as the two minute average from tap to taxi, which, in turn, will create greater demand.

"You get to that liquidity where it affects passengers," Bergman says. "If you get the supply side right, then [customers] will love it. They will start to use Hailo rather than hailing taxis off the street. They will use more taxis and tell their friends about it."


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