It is difficult and expensive to take a taxi in 2017. Is this really the original sin of the product and its operation?

During the 2017 Spring Festival travel rush, why has it become so difficult and expensive to call a taxi using an app? This issue has been a hot topic online recently, with some people even using the differences in cultural concepts between China and the United States to analyze the differences in product and operational thinking of Chinese and American apps, thereby explaining why it has become difficult and expensive to hail a ride through China's online ride-hailing apps.

Such an analysis, first of all, completely ignores the tremendous changes in the physical world of China's online ride-hailing industry during the 2017 Spring Festival travel rush, and contains unbearable logical loopholes.

Second, most of China's taxi drivers' orders still mainly come from hailed orders, and Didi is just a supplement, so it is necessary to implement a grab-order model. Attracting taxi drivers who are in severe shortage of capacity due to license control to take orders is very different from dispatching all orders from online express drivers. This is the core of the difference, not the difference in product manager culture between China and the United States. Even if we find a product manager from Uber in California to come to China to drive taxis, he won’t be able to succeed by using aggressive dispatching and system pricing. Without carefully thinking about the essential differences in business models and driver ecology, they rashly talked about the different ways of crossing the road in China and the United States, Chinese and Western medicine, etc. This is not out of touch with reality, but pretending to know.

Let’s first trace back to the origins and talk about the essence of Internet products and operational thinking.

Any Internet product requires a God’s perspective at the beginning of its design. This perspective will clearly see the role of each relevant party in the product and then give each role corresponding functions and permissions.

When it comes to online ride-hailing products, the main thing from a bird's eye view is to clearly see the vehicles, passengers, and platform parties, and to standardize the positioning, functions, and corresponding permissions of these three roles in the product.

The ultimate goal of online ride-hailing products is to enable the platform to match passengers and vehicles, allowing as many passengers as possible to travel while minimizing empty driving of vehicles. Therefore, whether it is the original design concept of the product or the setting of daily operating rules, whether it is grabbing orders or dispatching orders, whether the price increase is user-optional or platform-set, etc., it should all be for the purpose of achieving the above ultimate goal.

How to achieve the ultimate goal? The most important thing for online ride-hailing products and operations is to figure out the actual situation of vehicles and passengers in the physical world. In fact, this applies to all O2O industries, including online ride-hailing. To connect online and offline, we must first understand the actual offline situation, where the pain points in the physical world are, where the real needs are, etc., and then we can use the Internet to transform, evolve, and reshape.

The real situation of passengers and vehicles (Offline) ultimately determines the products and operations of online ride-hailing services (Online).

Now back to the previous question, why did it become difficult and expensive to call a taxi using an app in China during the 2017 Spring Festival travel rush? Is there something wrong with the online product and operation? Or is there a huge variable offline?

Previously, some people analyzed online that the problems were mainly with online ride-hailing apps represented by Didi. There was "original sin" in the underlying product design concept and operational thinking. For example, the original product design of grabbing orders instead of dispatching them ultimately led to the fact that online ride-hailing apps could not stand the test during this year's Spring Festival travel rush, making it difficult to call a car and very expensive.

Since January this year, it has indeed become very expensive to call a taxi using an APP in first-tier cities such as Shanghai. In first-tier cities such as Shanghai, not only Didi, Shenzhou, and Yidao, but also the "local snake" Shouqi Taxi, a large number of passengers have encountered the problems of not only difficulty in hailing a taxi, but also frequent dynamic price adjustments when hailing a taxi, making it very expensive.

Logically speaking, if there is an "original sin" in the product design concept of China's online ride-hailing apps, then it should have erupted whenever there was a surge in passenger demand during the Spring Festival travel rush. But why did China's online ride-hailing apps perform well in both product and operation during the 2016 Spring Festival travel rush? But why did the travel season fail to perform properly during the 2017 Spring Festival?

Comparing the 2016 Spring Festival travel season with the 2017 Spring Festival travel season, the products of China's online car-hailing apps are basically the same, and dynamic price adjustments also exist objectively in terms of operating strategies, which shows that there is basically no change on the online side.

Since the reason cannot be found on the Online side, by comparing the Spring Festival travel seasons of 2016 and 2017, are there any variables on the Offline side?

First, let us analyze the passengers’ travel demand. Compared with 2016, the passengers’ travel demand during the 2017 Spring Festival travel rush was even stronger. Public data shows that during the 2017 Spring Festival travel season, road transport carried 2.52 billion passengers, railways carried 356 million passengers, civil aviation carried 58.3 million passengers, and water transport carried 43.5 million passengers. Road traffic accounts for 84.6% of the Spring Festival travel capacity, with the greatest pressure and the most dispersed.

Second, let’s analyze vehicle supply. Compared with the 2016 and 2017 Spring Festival travel seasons, the capacity of online ride-hailing vehicles in first-tier cities such as Shanghai has dropped significantly.

This is a picture from a media report . It is not difficult to see from this picture that the points at which the online ride-hailing capacity in first-tier cities such as Shanghai declined were the introduction of new policies on online ride-hailing and the arrival of the Spring Festival.

After the new policy on online ride-hailing services in first-tier cities such as Shanghai was finalized, the requirements for local household registration and local license plates made many drivers want to quit, and they are planning to return to their hometowns or drive in other cities. Since the beginning of 2017, news reports have said that transportation management departments in first-tier cities such as Shanghai have stepped up their efforts to crack down on online ride-hailing vehicles at transportation ports, which has made many non-local drivers more determined to leave first-tier cities such as Shanghai. With the arrival of the Spring Festival, many drivers took the opportunity to go home for the New Year and naturally left first-tier cities such as Shanghai, which caused a sharp drop in the capacity of online ride-hailing services.

As passenger demand has exploded and vehicle capacity has dropped sharply, huge variables have occurred offline, while there has been no change on the online side. Naturally, this has led to the fact that since this year's Spring Festival travel rush, it has become difficult to hail a ride through China's online ride-hailing apps, and that dynamic price adjustments of high multiples have been frequently encountered.

In comparison, cities such as Chengdu and Shenzhen, where the new policies on online ride-hailing services are relatively relaxed, did not experience the same difficulties and high costs of hailing taxis during this year's Spring Festival travel rush as did first-tier cities such as Shanghai. This also indirectly confirms the main reason why it is difficult and expensive to haile taxis in first-tier cities such as Shanghai.

Moreover, for passengers in first-tier cities such as Shanghai, it is feared that after this year's Spring Festival travel rush, it will be difficult and expensive to get a taxi, which will become the new normal in the future.

Under the high pressure of policies, China's online ride-hailing capacity is not rigid enough. In this case, using cultural and conceptual differences to analyze the product thinking and operational strategies of the Online side feels very simple and naive, doesn’t it? !

As the saying goes, food and clothing have become a problem, but some people are still talking about how to make the food look good, smell good and delicious.

Everyone wants travel to be convenient, cheap, with good service and dignity, but first and foremost, there must be a car to pick you up, right?

Although success or failure does not determine a hero, the fact that Uber China was eventually acquired by Didi after several rounds of competition is the best example that the Online side of China's online car-hailing industry cannot ignore the Offline side.

As for the differences in culture and concepts between China and the United States, it is not impossible to discuss them. Americans believe that elites should rule the country, and everyone else can just blindly follow them; Chinese people generally believe that governing a country is like cooking, and everyone has the ambition to govern the country. Which one is better? Looking at the history of hundreds or even thousands of years, there are differences in culture and concepts between the East and the West. The east wind blows and the west wind gradually advances. There are strong and weak people in every stage, and there is no absolute good or bad, who is more advanced or more backward.

Whether through peaceful trade or war plunder, in the process of continuous exchanges, the East and the West have been learning from each other, drawing on each other's experience, and evolving together. Regardless of whether you are in the Internet industry or not, recognizing the reality of the physical world, allowing culture and ideas to first adapt to reality, and then evolve, transform, and reshape reality should be the principles of engagement with the world that both the East and the West should follow.

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The author of this article @Chief Speaker compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting!