Mobility: E-Scooters in Germany

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E-Scooter arrival

During 2019, the mobility landscape in Germany has been enriched by one more mode of transport: E-scooters can now be spotted in public space. There are currently six major suppliers active in Germany, many of them already competing abroad. In Berlin, for example, four providers have now started operations. Sharing Scooters are now located in all major European cities except London.

The key figures of sharing

Fleet sizes per provider, rentals per square kilometer, journeys per day, average idle times: Shared Mobility has its own key figures. Some of the providers have provided software interfaces for data exchange in their booking systems. These can be used to query the positions of the currently available e-scooters and their charge status.

Price models

The prices for the e-scooters vary depending on the provider and city. The price model is the same for all providers except for minute prices: at the beginning of the journey, 1 euro is charged for the activation of the scooter, after which a price per minute is charged. In Berlin the providers currently charge 15 cents per minute, in Munich 19-20 cents. The provider VOI does not only consider the location but also the demand, day and time in its pricing. With this dynamic price structuring the costs can vary from minute to minute, only a look into the App indicates the current price. Some providers have already increased their prices. TIER carried out the price increase in Hamburg, Munich and Düsseldorf barely 3 weeks after the launch and also circ has not yet finalized its pricing model.

The ramp-up of the systems

A simultaneous launch of similar products from different competitors in a promising market environment - for transport economists a more exciting situation than a Football World Cup. In fact, in a market in which traditional usage data (individual mobility patters) are only sparsely available (traffic surveys), the demand indicators obtainable for e-scooter sharing are still a real peculiarity

The race for users

We are currently in a very early phase of trials of the new transport offer. The media attention is great, the weather is fine and therefore we naturally see an increase in usage figures. It is still unclear which cities will prove lucrative for the providers.

No fear of range

The batteries of the electric scooters must be charged regularly. How this is done depends not only on the operating concept of the provider, but also on the behaviour of the so-called "hunters". By incentives of the providers, such as free minutes, these workers are supposed to find and load empty scooters. In any case, the curves show that the average charging level is considerably higher in the morning than in the evening.

Rapid consolidation of the provider landscape

It is still a little early to make reliable statements about demand and thus the long-term existence of the systems. In addition, some important players, such as Uber’s Jump, have yet to enter the market. Nevertheless, the market for rental systems is likely to consolidate within a year, similar to the 2017 bike sharing boom. Providers will limit their business areas to the lucrative inner-city areas, unless smart municipalities find a suitable form of regulation.

We do not expect piles of scooters

The suppliers and also the cities are warned after the experiences in other countries as well as by the bikesharing glut. Scenes such as those in the USA or China with piles of discarded sharing bikes will be sporadic (and the media will be all overt it), but this time the providers and local authorities are countering accordingly. For example, e-scooter providers focus much more on customer education right from the start.

How do you prepare yourself to leverage that massive growth for E-Scooters?

Right from your tech stack to growth hacks and business strategies, you’ll need to be able to change the wheels while your scooter is running.

That means you need to think beyond one-size-fits-all riders and strapped-on recurring billing solutions.

The key to tying recurring billing to growth, is to think about growth holistically.

True, one could go with a metric and detail all the ways that recurring billing could push it, but that wouldn’t do justice to all the things a billing system can do, on one hand, and all the different ways that you can grow, on the other.

Billing doesn’t move the product by itself, collect payments by itself, or support customers by itself, but it can bolster all three in big ways (product with subscription flexibility, customer care with dunning, transactional communication and revenue recovery, and the health of your business with accurate reports, and revenue recognition to call a few of the upshots out).

Opportunity: Scooters subscriptions are next

Millennials prefer to rent everything.

It has become an economic truism that Millennials prefer to rent everything, from clothes to furniture. But different types of rental programs create vastly different user experiences. Whereas traditional bikeshare programs are defined by going from docking station-to-station, and e-scooter rentals float docklessly in the public right of way. Millennials primarily preferences for monthly scooter rental are for trips to and from home such as scooted to the library, the grocery store, the mall, and to transit connections.

From a cost perspective, a monthly rental be was an unqualified success: Eg: the course of 19 days, with an average of 41 rides, averaging almost exactly a mile per ride. On a per-trip basis, 41 rides for $25 is a lot cheaper than the by-the minute rentals, which usually end up somewhere in the $3 to $4 range.

But along with the savings it delivers to heavy scooter-users, the ownership-like experience of a long-term rental does bring some of the disadvantages of ownership, too. Scooter´s damaged and the possibility of being robbed are aspects to consider for both – Customer and Scooter provider - .

Bend over backwards for your customers

Target customers preferences by offering a range of plans and consumption models for them to choose from. Create unique offerings to acquire customers and edge out the competition. Tailor product bundles offer usage-based pricing and create upsell paths.

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