Overview

Two kinds of customers use taxi service in India- one that books
online and one that doesnt.
As a cab service it is important to target both segment of users.
Meru cabs- target both these markets and also touted as
Indias No.1 radio taxi service.
Direct Competitors of Meru Cabs- Ola Cabs, Easy Cabs,Uber.
Indirect Competitors- Auto Services, Metro/local trains/buses.
Carpooling Services (Quick Rides)
Lets now juxtapose our Meru Cabs with one of our tough
competitor Ola Cabs for analysis.

1

Meru Cabs
Meru cabs kick started in 2007 in Mumbai by Mr.
Neeraj Gupta. Neeraj was born in a business
running family and he carried out the legacy.
Goals and Strategies: Being one of the oldest
Taxi service in India, Meru cabs is the No.1 Radio
taxi service. Started as a radio taxi service in
Mumbai, Meru Cabs goal was to spread its service
Background
to all major cities. From the offline service Meru
cabs have expanded to online service. Meru cabs
have also entered the international market such
as France.
Funding: Headquarter in Mumbai, Meru cabs has Funding:OLA has received a close to $1.2bn founding
raised $75M in two rounds of funding over 2015-
16. Some of the investors include Brand Capital
and India Value Fund Advisor Private Limited.
Size: Current employee strength of Meru stands
around 1000. And fleet strength of about 20K plus.
Revenue :For 2015-16 total gross revenue was
around 600cr and for 2016-17 its estimated to be
800cr.
OLA Cabs
OLA cabs started in 2010 in Mumbai under ANI
Technologies PVT LTD.
Founders are the IIT Bombay alumni Bhavesh
Aggarwal and Ankit Bhati.
Goals and Strategies: OLA cabs is the Indias
largest taxi aggregator. Its entry to the travel market
was well timed as there were no service like UBER in
India. Now the OLA is a common word in every young
urbans citizen. It has acquired TaxiForSure in recent
past. It has a plethora of services under its hood.
Size: Currently based in Bangalore, with 3500+
employees and fleet size of 350k.
till date with recent funding of $50mn from Vangaurd.
Some of the investors include DST Global, SoftBank
Capital and Sequoia Capital.
Revenue: For 2015-16 total gross revenue to be
expected at 3000cr as it is not undisclosed. However,
OLA declared a loss of 700cr for 2015.

Meru Cabs
Locations:Meru cabs operates across 24 different
cities, offering 5 different types of product flavors. It
has a global tie up with Frances G7.
Target Market: Customers who are in need of cab
instantly.
Assets: Has company own fleet size of around
2000,which has reduced drastically since the taxi
aggregator license was obtained. Does in-house
software development.
Business Model
User Segment: Wide range of user profiles with all
age ranges and demographics would need hassle free
taxi service. One of the unique users include to and
fro riders from airport.
Revenue Model:
For company owned cars: Company charges fixed
amount of money from the drivers (1000-2000rs) per
day as company fee that includes planned car
maintenance. For aggregator service: Company
charges anywhere between 10-18% of the trip fee.
Strategy Shift:
Initially company owned all the cars, which involved
lot of investment, to attract more taxi collaboration
the company has gone for light asset becoming just a
middleman for customers and taxi.
Company has also made its foot in online cab
booking apart from
offline (radio services) to bag more customers.
OLA Cabs
Locations: OLA operated across 100+ different cities.
Major share of business happens in metropolitan cities.
Target Market: Customers with internet connection who
are in need of cab instantly.
Assets: Since the company is a cab aggregator, the only
asset is the interface which the software application.
User Segment: Has a wide range of portfolio users of all
ranges and demographics with internet connection. Major
segment include commuters in metropolitan cities.
Revenue Model: Company has similar model of business
for revenue as Meru cab does. Runs on a commission per
trip model where in OLA charges a commission fee for the
sales it does. The commission is anywhere between 10-
15% and also the length of the trip. OLA owns the
technology platform.
Strategy Shift:
In 2014 to get a better exclusivity of market share, OLA
started to buy its own fleet of cars, which was looked as a
reversal strategy in the market.
OLA Autos-As part of taxi service auto service was
included this had a gamble since it could have disrupted
its cab services within a city.
OLA launched its OLA share as part of the car pooling
service which was a major hit among the metropolitan
cities.

Meru Cabs
Strengths:
Larges radio taxi service in India.
Preferred taxi service at airports in Mumbai, Delhi,
Hyderabad and Bengaluru.
Has strong foothold in tier 2 cities like Kochi,
Bhubaneswar because of its offline mode of
Strengths and Weakness
booking.
No Surge pricing.
Pain Points:
iOS app has very ordinary user experience with
cut down features compared to Android.iOS
ratings for current version is very low.
Comparatively more cab unavailability of cabs for
a given destination.
Drivers tend to cancel the bookings.
Prices are stacked slightly higher than Ola.
Price differences are huge in app booked service
and offline service.
Need to improve on wallet integration with the
app.
Pain points sources are user reviews of the app (link) Pain points sources are user reviews of the app and some
and reviews found online.
OLA Cabs
Strengths:
Regarded as Indias first taxi aggregator.
Acquires TaxiForSure and made it No.1 player in India.
Has high awareness among the Target segment
because of its aggressive marketing.
Has different services such as OLA Money, OLA autos,
OLA Caf, luxury car rental services proving its rapid
expansion among different sectors.
Provides car Wi-Fi facility for riders.
Pain Points:
OLA share rides has infamous repute of reaching the
destination late.
OLA cabs in tier 2/3 cities is yet to be matured. Only
very recently introduced the offline cab booking
facilities.
As any one with taxi license can be driver at OLA, it
creates a weak spot for itself for any misdeeds of the
driver.
OLA cabs spends a huge amount of money on
promotions which cuts through its profits.
market analysis of the business.

Meru Cabs OLA Cabs
App Downloads: Andriond Downloads 1M-5M. iOS App Downloads: Andriond Downloads 10M-50M. iOS
not released. not released.

App Ratings: Android rated at 3.8. iOS current App Ratings: Android rated at 4.0. iOS current version
version is rated at 1, whereas previous versions has is rated at 3, whereas previous versions has 3.3 rating.
3 rating.
App Reviews: Android reviews has positive reviews
App Reviews: Android and Apple reviews has whereas the Apple reviews are not up to the mark.
slightly bad reviews due to its unreliability and
Product Analysis

technical glitches. Performance: App performance in both platforms are

good.
Performance: iOS app hangs during continuous
usage. Functionality: App allows users to select the pickup
location and drop location and select the type of taxi and
Functionality: App allows users to select the pickup book. Has 5-6 variant booking options in Andriod and iOS
location and drop location and select the type of taxi as well.
and book. Has 3 variant booking option in Andriod
app Radio Taxi, Sedan and outstation, which is not User Experience: User experience is smooth. User gets
present in the current version of iOS. to see the price ranges of different variants right on the
landing page helps user to decide.
User Experience: Interface is not cluttered. User
flow is very easy. User is not bombarded with many Design: The UI layout has map background like other
options. Resolution issues are found in different cab services. The drop location text box is quite hidden
android devices. behind the pickup location when the landing screen
opens up which could confuse the user.
Road Ahead
Now that OLA has made their mark in Metropolitan
cities, it will be looking at expanding their horizon to
spread across 200-250 cities. This would give OLA a
bigger target segment, with varying tariff rates suiting to
the local city it will try to monopolize the region.
OLA will start concentrating more on the loyalty
programs such as OLA Select to retain its users from
switching the taxi aggregator. In major cities it has
become conveniently easy to switch the product. Hence
we could see a lot of loyalty and reward features coming
in.
6
References

https://www.merucabs.com/about-us/
http://www.isb.edu/ctlc/meru-cabs-case/meru-cabs
https://play.google.com/store/apps/details?id=com.winit.merucab&hl=en#details-reviews
http://www.forbesindia.com/article/work-in-progress/merus-flawed-business-model-negates-its-brand-
value/33480/1
http://www.vccircle.com/news/consumer/2014/04/02/how-meru-cabs-asset-light-strategy-may-help-it-break-even

https://www.crunchbase.com/organization/ani-technologies#/entity
https://www.quora.com/How-does-OlaCabs-work-What-is-their-business-model-and-is-it-earning-them-profits
https://play.google.com/store/apps/details?id=com.olacabs.customer
http://www.livemint.com/Companies/mXPmsZTx2xrqU8YMTWfRnL/Ola-revenue-rises-eightfold-to-Rs418-
crore.html
http://economictimes.indiatimes.com/small-biz/startups/ola-recorded-loss-of-rs-796-crore-for-fy15-as-it-spent-
heavily-to-maintain-market-lead/articleshow/52876645.cms