The Spanish-born ride-hailing company is rolling out a pilot multimodal subscription model to 40,000 users in Madrid this week, with plans to expand to other markets throughout Spain and Latin America.
The “Cabify Go!” subscription service is somewhat akin to a loyalty scheme for recurring (or would-be recurring) customers. All of Cabify’s different mobility offerings — ride-hailing service, electric moped MOVO, bike subscription and courier service — are already available under one app, but now customers will also be able to get discounts that are designed to encourage them to utilize the full range of these multi-modal services.
For example, the “Everything in one” plan, costs €6.95 per month and gives users a blanket 10% discount on all their ride-hailing trips, as well as 30% off its courier service and a number of free e-moped rides. Alternatively, its “Pedal” plan pairs up monthly electric or mechanical bike rental with a 10% discount on ride-hailing trips. There are no sign-up or cancellation fees for any of the services, and users can cancel at any time.
“One of the company’s top priorities is to ramp up and consolidate our multimobility service proposition which provides our users with diverse sustainable alternatives and aims to replace the dominance of the private car,” said Leonor Barrueco, Cabify’s VP of growth.
Founded in Madrid in 2011, Cabify quickly pivoted to make Latin America the focus of its operations. Instead of trying to conquer other markets like food delivery and self-driving vehicles, the Spanish company has focused on profitability – and became one of the first ride-hailing companies in the world to report profitable EBITDA results in the last quarter of 2019. This is feat that neither of its much larger competitors Uber or Lyft have been able to achieve yet.
There is a broader trend from ride-hailing service providers to move into more comprehensive mobility services, which could be seen as a shift from ride-hailing to having their own Mobility as a Service (MaaS) platform. Didi Chuxing which is a Chinese ride hailing company started off as a taxi-hailing service before moving into other forms of transportation. Lyft and Uber are making decisions in that direction as well by gradually including more and more modes of transportation into their apps. Cabify appears to be the first to introduce month by month bike and e-bike rentals as part of their offering, as opposed to short-term free-floating vehicles. This could be a smart move as it further broadens their potential user base.
This shift towards providing broader mobility services should not be too surprising. A reason for this trend could be compliance related, by adopting more sustainable mobility offerings they can soften criticism from cities and the public that the sector increases congestion and contributes negatively to environmental net effects. But the sober commercial reason could simply be that increasing the breadth of mobility offerings increases the number of possible users that could download your app, as well as increasing the number of times they actually open the app. Once the app is opened, the temptation to choose ride-hailing over the myriad of other options provided will always be there, like the candy lurking in the impulse-buy section of the supermarket checkout counter. Mobility is ultimately about convenience after all. So it makes perfect sense that single-purpose ride-hailing apps are evolving into the mobility equivalent of convenience stores – come for the milk, leave with a hotdog.
Written by Daban Rizgary,
RISE Mobility & Systems (Människa-autonomi)