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Disrupt everything: Lagos and the transportation overhaul
The streets are flooded, it has been raining all night and all morning, and I need a cab. I have a couple of meetings to get to and I don’t really know the city that well. I would order an Uber but it doesn’t operate here… yet.
I am in Lagos and everywhere I look is chaos and masses of cars…
Transportation is a major problem here, so much so that a number of startups and established companies have decided to throw their hats in the ring and disrupt the space. This is good — in a city so densely populated, platforms that help reduce friction in transportation are needed.
Technology can solve the transportation issues in Lagos if the right data is available. With the right analytics, traffic in Lagos could easily be managed and the people could get to their destinations easier. But people still need to find their way to that destination.
Finally, a cab. I get in and the driver says it will cost N800 to get where I am headed. This trip should take 10 minutes, but we are hit by traffic and it is now going to take four times that. Due to this little snag, the driver has now doubled his price, so we begin to haggle. This shouldn’t happen, but it is happening everyday in Lagos, Ugochi Ugbomeh (the founder of e-hailing app Tranzit), tells me.
“Why should you as the consumer have to pay for something that is out of your control?” she questions. “This is why we started Tranzit.”
Disruption and the rule of three
Tranzit is not the only company trying to disrupt this space by creating a service that takes the pain of haggling from the consumers. Afrocab, the latest entry into Nigeria’s highly contested e-hailing space, has a few tricks up its sleeve.
Working on the same model, you order a cab online, are given the price upfront for your destination and at the end of the trip, you pay. But Afrocab feels it has given its service a twist by allowing the user to decide how much they want to pay.
“The way we see it, you can decide how much you want to pay, depending on how quickly you want to get there,” says Taj Zadhra-Ogunsola, Managing Director of the service.
He reckons that this way the user knows exactly what is going to happen when they order a cab. The service gives you three options (Taxi, Black and Luxe) and users can toggle between the options. If you pick Black and enter your destination, you can then determine your price and your request is then sent to the drivers. Users get to watch how many drivers have seen the request, who has rejected it and who has accepted it.
The disruption that is happening here is not about the way people move around, but the way people think about moving around. There are three key aspects to what is happening in Nigeria’s transportation space: safety, quality and cost. All the players getting into this space all claim to focus on that.
“We want to provide, security, good quality cars and a good price that is constant,” says Tranzit’s Ugbomeh.
The way Tranzit sees it, the consumer always knows what is coming and what they are in for — no surprises.
Challenges of disruption
Yes, disrupt everything — but even that has its challenges. There is a certain level of education that needs to happen before both drivers and consumers are completely comfortable with these services. Afrocab is building a training manual for its drivers, while Tranzit is educating the market about driver behaviour and client trust.
Other bigger and better funded players are getting in the market as well. Rocket-funded Brazilian clone, Easy Taxi is here and hoping to make big splash. Then there is Uber, the king of cab industry disruption, which is making its way to Africa’s most populous city any day now.
How can these startups compete? They can probably insert some local flavours and incentives that could get locals to use their service. Then again, it is Lagos, and there could be more than enough people for everyone.
These actually aren’t the main issues and although e-hailing and these companies do solve some very key problems, there is another major issue that needs to be tackled. Cabs are not the only way people want to get around. These platforms, although great, can also be a tad pricey for the consumer as well. What about a decent public transit system — buses, for instance?
Public transport, if you please
The biggest issue with transportation in Lagos is that there are too many cars on the road and the “dead cars” that clog up traffic need to be removed quickly, the founder of Hotels.ng says. He spends up to five hours in traffic for a commute that should be less than an hour total.
All the tech-savvy apps and platforms seem convinced that they are about to disrupt the way people move around and create convenience, where the key thing that needs disrupting is the thought process. Lagos could benefit from car-sharing apps that create incentives to have fewer cars on the road. If this critical mind shift happens in the psyche of the consumer and changes their behaviour, the service providers will have no choice but to follow them. Theoretically.
So how does this problem get solved and who is solving it? How do you remove excess cars on the road? What Lagos and most emerging market cities need is a decent rapid transit system. Give the people a good, reliable public transportation system and they will leave their cars at homes.
Yellow Navigation seems to be certain it has figured out how to solve this problem. The idea: air conditioned buses with free WiFi and tablets with built-in entertainment packages.
“We essentially want to sell advertising on the tablets during the day and at night turn the buses into a cinema and people can watch movies on their way back from work,” the team tells me.
Here the margins are quite high because the current daily commute buses are dirt cheap but don’t offer the same level of comfort and safety that this service wants to offer. Countering its cost in order to give the commuter this would mean hiked up bus prices.
“No,” says the team.
So how will it counteract costs? Partnerships. Samsung has come on board to provide all the tablets and brings with it a content partner so all the media in the entertainment suite will come with rights to air.
In the end, it is the experience that counts. The current transportation industry in Nigeria maybe problematic but somehow people get on uncomfortably navigating the crowded streets of Lagos. What these tech upstarts want to do is not just create ease and efficiency, but an experience worth paying for and an experience people are willing to pay for.
