3/28/2017

Netnography-Shared economy in transportation sector Submitted to: Dr Bijal Mehta

Submitted by:

• Sohil Ghoghari B 22

• Krishna Karia B 31

• Ramya Kurup B 33

• Vinit Meghani B 34

• Krutesh Mehta B 35

• Parth Rajyaguru B 51

• Dipak Savaliya B 53

• Dharmik Shah B 56

• Namankumar Yagnik B 77

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Project Title: Netnography- Shared Economy in Transportation

sector (Cab services in India)

[1] What is Netnography?

Netnography is an online marketing research technique to provide with consumer insight.

“Netnography” is ethnography adapted to the study of online communities. As a method,

Netnography is faster, simpler and less expensive than traditional ethnography, and more

naturalistic and unobtrusive than focus groups or interviews.

It provides information on the symbolism, meaning and consumption patterns of online consumer

groups. To put it short, Netnography is an online research method originating in ethnography

which is applied to understanding social interaction in contemporary digital communications

contexts.

The term Netnography is a combination of “Internet" or "network" with "ethnography".

Here we have tried to understand the term Netnography in the context of Transportation segment.

In detail, we also tried to understand the border perspective of Shared Economy, a new concept in

terms of transportation segment in Indian market. Unlike west, our market still does not absorb the

concept of shared economy in various sectors like Cars/automobiles, property,

[2] Research Issue:

“Feasibility of Shared Economy concept in transportation segment in context of

Indian Market”

To understand this topic, first, we have to understand what Shared Economy is and how it all

started.

What is Shared Economy?

Sharing economy is a socio-economic ecosystem built around the sharing of human and physical

resources. It includes shared creation, production, distribution, trade and consumption of goods

and services by different people and organisations.

Sharing economic activities falls into four broad categories:

• Recirculation of goods

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• Increased utilisation of durable assets

• Exchange of services

• Sharing of productive assets Sharing businesses either:

• Own goods or provide services that they rent to customers, often on a short-term basis, or

• Create peer to peer platforms connecting providers and users for exchange, purchase or renting of goods and services.

Shared economy, when coupled with latest technologies, generates the following benefits:

• Social and environmental benefits

• Cost benefits

• Conserving resources and reducing environmental impacts.

• Economic benefits (Unused assets are shared therefore per head costs would reduce substantially)

Shared economy is a wide concept; we have to study one segment of shared economy, which is

Transportation segment.

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Shared Economy in Transportation:

Sharing transport is disrupting traditional business models – including transport. Its fast growth

is rooted in three things: an ability to leverage spare capacity and expand systems without large

investment requirements, the exponential effect of collaborative experimentation and learning,

and the ubiquitous nature of distributed capacity. The coordination in real time of all these

elements has been enabled by the rapid expansion of mobile internet technology.

The presence of spare capacity is a reality in the transport sector. A typical car lies unused for

approximately 23 hours a day. This represents a tremendous investment in overcapacity – both

for car owners and for the public authorities that provide and maintain public infrastructure.

The transport market has seen the emergence of new types of services that complement those

of today and offer new ways to tackle the externalities of growing urban populations. All

players in the system may need to adjust to provide citizens affordable mobility. With around 2

million users worldwide, car and ride-sharing are still marginal but the arrival of major car

manufacturers in the market and the rapid growth of new service providers signals the growing

importance of these services. The influx of new, well-capitalized entrants may signal a

fundamental change in the mobility ecosystem.

Shared Economy concept can be used in various modes of transportation, but the most

adequate and popular mode is cab services, especially on-demand cab services like UBER and

OLA.

Shared Economy in Cab Service (world)

The leading businesses that are advancing the concept of the “sharing economy” are in many

respects no longer insurgents and newcomers. The size and scale of Uber, Airbnb and several

other firms now rival, or even surpass, those of some of the world’s largest businesses in

transportation, hospitality and other sectors. As the economic power of these technology-

driven firms grows, there continue to be regulatory and policy skirmishes on every possible

front, across cities and towns spanning the United States, Europe and beyond.

While many municipalities and regions have accepted change as inevitable and have been

eager to facilitate new efficiencies for consumers — Uber, in particular, has made a lot of

regulatory headway since 2015 — there have been cases, such as in Austin, Tex. in May 2016,

where policies have been in effect reversed to block these new forms of commerce. These

fights are looking more and more like political campaigns. In any case, a 2015 report from the

National League of Cities reviews regulatory policies and patterns across a variety of

dimensions, from safety to innovation; a 2016 report from the European Parliament weighs the

costs and benefits of non-participation in the sharing economy.

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3] E-communities to study:

Now that we are clear about our research issue and topic, we will now understand the content

which is available on various e-communities.

In order to understand the usage of digital marketing in this segment, we have segregated

these activities into three segments. Content from Company’s side, content from Customer’s

side and content from experts praising or criticising the service.

Content available online (From Company’s side)

Nowadays, all the companies are using digital marketing as a tool to promote their products

and services. The share of digital marketing is increasing in all the company’s total

advertisement budget.

Here, Both Uber and Ola using digital marketing to,

(i) Promote their services

(ii) Respond to customer queries

(iii) Response to customer grievances

Below are some of the examples of how they use digital marketing.

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(i) They use e-communities, especially social media to promote their service offering to the consumers.

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(ii) Apart from promotions on social media, they respond to customer queries and customer grievances

through social media. Their response very quickly.

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Content available online (From Customer’s side)

Not only the company but the customers also share contents in terms of.

(i) Reviews

(ii) Queries

(iii) Grievances

(iv) Brand advocacy

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Content available online (Expert Reviews)

This type of content is generated by the experts. They write these reviews based on their own or

other person’s experiences. They are considered to be opinion leaders. Their content may affect the

brand reputation and o overall business. They are independent experts; they don’t pay for content

they generate.

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Authoritative Restrictions:

The sharing cab is a noble concept widely acclaimed by the world. But, there are many restrictions.

In some specific region, the local government does not allow these cab service providers to use

such sharing concept based service.

The local authorities where these services are banned claimed that the government was never

consulted and in addition, these services are in violation of permit conditions. Cab aggregators are

introducing and running these facilities in a very clandestine way. They have been bringing out

more variants of shared rides, which is technically illegal.

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[4] Discussion/Analysis:

• Both the advertisements (digital) of Uber and Ola are very direct and to the point which

introduces to its customers the concept of shared economy/ sharing of the cabs

• Strategy is to tapping different people with specific place, customers, purpose (which includes the

eve of valentine’s day) which indirectly serves multifold marketing purposes of generating more

customer base, creating buzz amongst customers, and also creating a casual/ cool quotient

amongst the customers

• Such tactics of digital marketing has increased because of the penetration and increased usage of

mobile/ latest technology handhelds or devices especially amongst the youth who also

contributes to the major chunk of the pie

• By the profiling of the customers, both the cab majors have succeeded in getting their existing

customers to continue using their services. i.e. they have succeeded in increasing their repeat

customer numbers

• Both the cab majors have used keywords in their digital advertisement (Uberpool and Ola share).

By creating keywords, the organisation is creating a new set of customers who prefer economy

over comfort

• Creating two-way interactive communication for the customers and brand is the biggest USP of

Digital Marketing

• Creating faith amongst the community (target customers) in service marketing is the most

important priority for a service oriented organisation. And in the case of Ola and Uber, it is served

digitally. It shows a greater significance of digital marketing in their modus operandi

• Creating positive/ negative testimonials and rating creates a ripple effect on the existing as well

the prospective customers. It could result in a gain of trust or loss of trust from the organisation.

In case of Ola and Uber as a shared economy has got both positive and negative review on the

digital platform which has ultimately increased an option for the customers to switch to some

other services

• Some other instances show that Digital marketing strategy for Ola and Uber has enabled them to

solve the customer grievances in a very quick and efficient way and convert angry customers into

a delightful one

• Digital platform allows customers to write content which is, in other words, E-Word of Mouth.

Their positive/Negative feedbacks and reviews create a huge impact on other customers which

are willing to avail such services. So, this will force the companies to provide excellent service.

• Apart from customers, there are some experts, tech experts who are also written reviews on

technical and operations aspects of the company, they are an opinion leader and can generate

positive or negative impact on customers.

• Digital marketing gives an edge for the companies to educate their customers for co-creating a

great service environment. Uber has put in such efforts in its digital marketing strategy

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[5] How they use Netnography?

In order to increase their business and reach, these cab aggregators use the consumer behaviour

of customers on digital platform extensively. With the help of collected data, they constantly

change and improve their services in order to achieve high customer satisfaction ratio.

The first tool they use is “Word Association Matrix”.

In a simple language word association matrix is a tool which helps the company to find positive

and negative words from the customer generated content. As the customer’s generated data is

always in a large quantity, for example, Facebook post/comments or Twitter tweet, it is very

difficult for the company to keep an eye on each comment or tweets. So, they use “Word

Association matrix”.

This tool focuses on a specific word and interprets the whole comment/tweet/feedback as

positive or negative.

For example,

WORDS: Crazy, Wtf (Negative words)

WORDS: Super, Refreshing (Positive words)

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Offerings according to customers’ needs:

Effective use of Netnography helps companies to create their advertisements, service offerings

according to the target customers’ requirements.

They use rational/logical, emotional appeal and humour to target their customer base.

As India is a country with a diverse culture. Indian languages, religions, dance, music,

architecture, food and customs differ from place to place within the country. The Indian culture,

often labelled as an amalgamation of several cultures, spans across the Indian subcontinent, they

designed their language of advertisement and offering according to the specific region.

OLA in Tamilnadu

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[6] Conclusion:

As the number of internet users is increasing in India, internet based startups are

getting more and more customer base for their services. Shared Economy concept

was developed in the west, as India is following western habits; the same concepts

eventually come to our market.

Shared Economy in Indian cab service market:

This concept in spreading across the world and India is not excluded. This concept is becoming

popular in India especially in metro cities. There is a high chance that this concept will work in

India. Below are some of the reasons to support this argument.

Purchasing power: When compared to India’s western counterparts, the purchasing power is substantially less. So, it makes more sense for Indians to opt for rental or pre-owned products.

Millennials will shape sharing economy: Millennials display a change in attitude and have displayed a delay in buying behaviour. Considering the fact that more than 65percent of India’s population is under the age of 35, it is safe to say that India is a welcoming place for the sharing economy boom.

High-population density: India has a very high population density of 368 per sq.km, while in the US it is 33 per sq.km. This means that we have 10 times the population density of the US! On the flip side, this means that there are more goods and services available much nearer than in any other country. This helps in enabling hyperlocal services which ease the availability and logistics issues.

Increasing urban population: The trend of sharing is more popular and acceptable among the urban population. It is predicted that by 2025 India will have about 42percent of its population in urban cities, which in turn would lead to a large number of people adapting to a collaborative economy.

It is here to stay: According to ASSOCHAM’s predictions in 2014, the used-goods market would cross the 1, 50,000-crore mark in the year 2015 and is seeing a YoY increase of 12percent.

Sharing economy is a movement and not just a trend. You will notice people all around you making the smarter choice by adopting and contributing to the sharing economy. We’ve witnessed businesses for centuries making buying really easy. We are at the beginning of making sharing easy

"The sharing economy is not only feasible, but it is the future. There is room for literally

hundreds of sharing economy companies in India," said Vivek Wadhawa, prominent Indian-

American tech entrepreneur.

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