Linkedin Tag

Or the data network effect as a business model transformation lever

London, April 2017. There are 6 of us: 2 adults and 4 children. When you are in the streets of London with 4 crazy teenagers, the priority is not to lose them among the millions of tourists. So spending our time with our noses in a map of the subway, not so much. Until a Londoner advised us (as an evidence) to download the Citymapper app. And then, it’s a revelation! The app that transforms our vacations: not only is the transportation problem solved, but the trips become a fun event. Taking a red bus on the right side of Baker Street knowing exactly what time it will pass? Elementary!

Starting point: usage

Citymapper was created in 2011 by a former Google employee, in London. He started from the principle that it was complicated for citizens to move around the city because of the lack of information. So he had the idea of using the power of mobile applications, combined with the power of open data on transportation, and thus offering “the app that simplifies the city”.

He then set up a simple offer, through a complete service: you find on the app all the information you need to get somewhere, in real time.

To innovate, you have to create value; and clearly, it addresses several functional problems at once: information, time saving, simplification, risk reduction, organization, connection, integration, reducing hassle, etc. In short, it answers the need, in a simple and actionable way.

The human behind the algorithm

And to meet this need, he will develop a technological application, doped with data, and generating data.

It first uses open data from transport authorities and cities when it is available
it also collects behavioral data from the app’s users: trips, stops, times, geolocation, etc.
And then, it recruits the “heroes”: volunteers, fans of Citymapper, who voluntarily provide the app with information such as “where to place yourself in the train to optimize a change of metro”. Thus, for example, they manage to identify the Peseros of Mexico City, countless private minibuses not catalogued anywhere. And in Istanbul, a city with no open data, he inventoried the metro stations. Data crowdsourcing”.

From the network effect to the data network effect

Relying on humans has other advantages:

  1. first, the network effect, which is the phenomenon by which the real utility of a technique or a product depends on the quantity of its users. Ex: facebook, twitter, airbnb. Thus, with very little marketing expenditure, it manages to be installed on more than 50% of London phones in only 2 years, thanks to word of mouth and heroes.
  2. This will then allow him to activate     the data network effect: the more users, the more data, the better the service becomes.

With all this, he can then study the past, the present, and start making predictions to imagine new solutions.

“Lean testing”

It then creates an internal bus route simulation platform, which allows it to create routes and study the consequences in terms of use, behavior, etc. The tool will automatically define stops, and predict who will get on, off, where and when. The tool will automatically define stops, and predict who will get on, off, where and when. It becomes able to tell which new routes should be created, and since it can simulate their use, it can estimate their profitability: this is the first part of the experimental phase.

The second step is to set up a free bus in London for 2 days to test the route identified via the platform, while waiting for the stamp of the Transport for London (TFL). It is also testing technological evolutions on the app, with a gobot, APIs & widgets for websites and mobile shops, natural language, etc..

Administration vs. innovation: 1-0

And the Citymapper team ran into regulatory roadblocks: a weekend after the bus started operating, they decided to change the route based on the driver’s initial input. “We had to wait weeks before our change was accepted” (by Transport for London), the team writes. “It’s hard to innovate when you have to meet such deadlines.”. This was akin to trying to use real-time data to improve a “fixed route” bus service. Faced with the risk of not being able to dynamically adapt routes quickly enough, Citymapper then gave up on operating buses.

That’s it, Citymapper is no longer just an app, it’s a bus operator: the company launches its first commercial bus service a few months later to serve East London at night during the weekend: the CMX1.

 

Towards Mobility as a Service (MaaS)

But never mind: in 2018, they obtained a license from TFL to operate a shared cab service and created “SmartRide, a network, not a route.” And this even though the British capital had decided in September 2017 to ban Uber. Minicabs cannot carry more than eight people according to TFL rules, but they, are allowed to operate on variable routes. The offer then evolves into a shared minicab offer, still based on complementarity with existing services, but this time on a dynamic definition of routes in real time. As this is public transportation, bus stops (pick-up stops) still exist and are used to coordinate several passengers. Since all reservations require the app, they can match the right vehicles to the right people in real time. The technology distributes and assigns drivers to areas of the city based on demand. And they can react in real time to road closures and other transit system challenges, such as disruptions or strikes.

Of course, the app also integrates payment, and the price defies all competition.

 

Thinking big

2019. Citymapper operates in 39 cities around the world and announces the launch in London of its MaaS offering, powered by its own transportation card.

portée par sa propre carte de transports.

The subscriptions give unlimited access to buses, metro, Santander self-service bicycles, and a number of rides with the Ride service. Soon other modes of transportation will be included: VTC, scooters, cars without a license, and other floating vehicles… And beyond access to multimodal transportation with a single subscription, they are now tackling “routing for floating transportation” in addition to their existing real-time dynamic offers.

The floating transport revolution according to Citymapper

The ambition is global: as they expand their offering to other cities, they are aiming for a future where a single subscription will work everywhere across relevant cities in the world.

From mobile app to global MaaS.

 

Click here to read the article about ecosystems. 

GET THE LATEST INSIGHTS DELIVERED TO YOUR INBOX

Don’t miss the new analyses of our experts.