How Taxi Apps Improve Customer Experience and Win Market Share

When Uber and Lyft jumped onto the transportation scene, the traditional taxi industry had to do something—fast. Once passengers were able to order a car and be on the way to their destination in a matter of minutes, standing on a corner with a hand in the air or calling a dispatch number quickly appeared outdated in the eyes of Millennial riders. The customer experience offered by Uber and Lyft impacted the taxi industry irreversibly and the savviest of fleet owners knew that they would need to incorporate comparable tech to stay competitive with the Silicon Valley disrupters.

As competition increased, taxi fleets all around the world realized that the only way to keep up was to improve rider experience with their own apps. Riders needed to be able to order a taxi just as easily as they could summon an Uber or Lyft. Upon launching their own apps, taxi fleets recorded significant improvement in customer retention.

However, this is not a simple case of ‘may the best app win’. There are a number of advantages that taxi fleets have that can’t be replicated by rideshare—advantages that can be better exploited via available technology.

Cabs can still provide more immediate service at airports, hotels, and in areas where cabstands are still utilized. The protection provided by government regulations places these vehicles exactly where the rider needs them. This allows riders to hop right in instead of having to order a rideshare vehicle and wait. When taxi fleets enlist the right tech, this places cabs at a real advantage over their newer competition.

RideYellow and Flywheel, for example, partner with LISNR to bring ultrasonic technology to their fleets, allowing riders and drivers to pair instantly on vehicle entry. This functionality allows riders to know whose car they’ve hopped into and pay seamlessly from their app without having to wait for a rideshare vehicle to find them.

Previously, riders would enter a taxi and had to enter a code in order to pair with their driver. This process was a bandaid fix to the larger issue of authentication. When digital payments are in use, drivers and riders need to be able to connect with one another to ensure that the correct rider account pays the correct driver for the journey in question. Doing this manually set taxi fleets back a few steps in their quest to improve the riders experience. That’s exactly why RideYellow partners with LISNR to help riders and drivers pair automatically, making code confusion a thing of the past.

These technological innovations are in direct response to the increasing competition between taxis and rideshare companies. One major obstacle that taxi fleets still face centers on the sheer number of taxi apps out there. Uber and Lyft have the advantage of working in a number of cities, using the same app for any trip. In order to compete, hyper-local taxi apps will have to provide meaningful incentives and impeccable user experiences to get riders to contribute to the 40 apps on average they have installed on their smartphones. That is exactly why Flywheel and RideYellow chose LISNR as their technology partner—to create a safer and easier experience for riders and drivers.

As competition gets fiercer in the transportation industry, taxi fleets and dispatchers will need to differentiate and elevate their customer experience to win back market share from the likes of Uber and Lyft. Riders have been trained to wait for rideshare vehicles because they offer an easy experience, but cabs just need a few minor tweaks to provide a similar experience. After all, if a taxi is there right when a rider needs them and is able to authenticate in a matter of seconds, watching a rideshare driver inch towards the rider’s destination in-app will become the less efficient option.

Taxis have provided safe and easy rides for over 100 years and this staying power represents their ability to innovate and focus on the customer. Ultrasonic technology is the latest tech that is helping taxi fleets compete. And it can help with much more than authentication, such as facilitating frictionless payments as well.

If you would like to improve the function of your taxi app and provide a seamless rider experience, get in touch with the LISNR team.