Taxi App Development: Сomplete Guide
Taxi app development is currently on the rise as the convenience and ease of use compel a large number of people to use such services. The surge in demand over the past decade correlates to the significant success of major companies in the niche, proving that profiting from cab booking is entirely possible.
In order to create a taxi app that will stand confidently against market giants, you will require a lot of preparation and a dedicated development team by your side. As with any business, your achievements largely depend on how well you can appeal to the audiences with your proposition and how robust your technological solution will end up being.
Our definitive guide will describe the essential elements for success, how the taxi booking app development process looks like, how much it can cost, and many other noteworthy details. Keep on reading to get the best industry insights.
Market overview of taxi apps
The industry of cab booking has existed for many decades now, giving people the convenience of traveling from one place to another without a hassle. Notably, the niche has significantly evolved over the last years with trends like digitalization. Now, users don’t need to call the operator and place a booking. All they need is a smartphone with an internet connection, and they can begin the journey in minutes.
Some of the most widely used taxi applications in the world include corporations like Uber, Bolt, and Lyft. Of course, there are also more undersized businesses that are popular locally and have their appeal to smaller demographics.
It is easy to see why many organizations are looking into how to create a taxi app of their own. The size of this industry is undeniably significant, with a projection to reach $283 billion in revenue by 2028.
Taxi App Projected Market Size 2023 to 2028 ($bn).
In addition, obtaining clients may not be as user penetration since the user penetration rate is around 21.9%, and the overall number of ride-hailing customers is projected to amount to 1.92 billion users by 2027.
The taxi market is further convenient for passengers because it allows for a sizable selection of car types and rides, including anything from standard to premium options. On the opposite spectrum, it provides an opportunity for independent drivers to earn money and select their own working schedule, controlling their income on the basis of working hours.
As for the business owner side, companies no longer need to establish their own network of drivers and manually accept bookings. With a reliable software system, many daily operations, like fair calculations, are now automated. Hence, we see an increase in demand for app development services in this particular sector.
At this point, to build a competitive taxi app that has a chance of growing into a mainstream brand, stakeholders need to do their due diligence in filtering out and selecting the most appropriate development providers. It is best to go with companies that have proven experience developing similar applications and have insights into this industry.
Features of taxi booking app development
Most taxi bookings operate on basic features with some unique functionalities depending on the app. The crucial detail to remember is that if you want to build a taxi app, you must account for the fact that the drivers and the customers require two separate applications in order to conduct specific operations accurately. Let us reveal what this means.
Important features in taxi app.
A standard set list of features for the driver side of the app typically includes the following:
- Booking requests. The request typically pops up on the screen for the drivers, giving them a relative time to accept or deny the booking request. This request should display the pickup location and the destination point to allow drivers to assess the time and resources required to complete the booking.
- Request status. The status of the request shows whether the driver is en route, when they had arrived at the pick-up point, when the drive began, and when it is complete.
- In-app navigation. Having a reliable GPS system on the driver’s side allows them to remain in the app while they perform the request. It can also construct the most efficient route to the pick-up and destination points.
- Chat and call with the customer. There are moments when the booking request must be specified. This is when an in-app chat and a voice call can be very useful in sorting out any misunderstandings and arriving at the correct place.
- Daily earnings. Since drivers earn the commission from the rides, they should be able to view the payment they receive from every booking once it is complete. Additionally, let them know their total income for the day when they decide to finish the session.
- Passenger rating. At the end of each ride, the river can assign a rating from 1 star to 5 stars to the passenger based on their satisfaction level. This builds a system of prioritizable customers that provide a positive work experience and, conversely, low-priority passengers.
On the other hand, a customer’s side of the taxi application development must include features such as:
- Location and destination pickup. The customer must be able to open up a map and enter their pickup address or drop a pin in the location where they want to be picked up. Similarly, they can do so with their destination point.
- Driver tracking. Display the driver’s information once the booking has been accepted, including their name, car type, and number plate. Give your customers an opportunity to track the location of the driver with real-time GPS, showing their progression en route.
- Cab type selection. Most popular taxi apps provide passengers with a multiple selection of cab types, such as economy-class, standard, luxury, etc. Additionally, you can further segregate the taxis by vehicle types, like sedan, SUV, minivan, pickup trucks, etc. This can be implemented by letting drivers enter their car type information.
- Price calculator. Developing the cost calculating software is essential to adjust the price for taxi bookings according to the destination, mileage, commission fees, and other aspects. Consider an option for increased demand, amplifying the prices in peak hours or during high loads of requests.
- Secure online payment. Being able to pay for the services with your card online is a worldwide standard nowadays. So, be sure to integrate payment methods with credit and debit cards, as well as mainstream digital wallets.
- Driver rating. Much like the passenger rating, customers can rate drivers based on riding experience to sort out prioritized drivers. Such a system rewards positive behaviors and nurtures a friendly environment.
In addition, features like booking history, registrations, and push notifications should be available on both sides and can be developed similarly. As a business owner, you may be willing to add or adjust the features how you see fit. This should improve your understanding of how to build a taxi app.
How much does it cost to build a taxi app?
The cost of development is notoriously difficult to estimate without an initial consultation. Selecting and contacting app development and UX design companies will allow you to discuss the project in detail and receive details of cab booking app development. This will include both the time required to build the app and a custom price quote on the project.
Factors that affect the taxi app development cost.
Generally, development service providers estimate the project cost based on several aspects. The first and most significant factor is the complexity of the project. If you are looking to craft a taxi app for both drivers and clients, the technical team will require more resources to complete the work within the established timeframes.
Naturally, the second factor is the number of work hours of the specialists who will be handling your project. Different development companies charge their designated fee on a per-hour basis. You may also encounter propositions with a fixed-price model, where they calculate the time it takes to finish the app and provide a quote on how much it will cost.
Lastly, the type of platform you choose will play a role as well. While separate iOS and Android development costs approximately the same, if you decide to go with native app development, you can expect to pay double the price. In this case, cross-platform development may be a more budget-friendly option.
Overall, skillful app development can cost upwards of $50,000+, with the price fluctuating depending on the requirements. Feel free to contact us and schedule a meeting to discuss the price of your app idea.
Succeeding with taxi app development
You may be wondering how you can succeed in a particular niche when there are so many other established offers on the market. The answer can be tricky, but one thing is for sure: you need to think of your users first, both the drivers and passengers.
A rigorous market analysis will unveil the areas where your competitors are lacking, and you can work towards improving these aspects. You can also look at the overall tendencies in the niche and listen to what the users demand. Here are some of the things you can consider to get your taxi app to the top:
Factors that influence the success of a taxi app development.
Reliable customer/driver support system.
Since you will be mostly overlooking the booking system, the fate of how the ride will go lies solely in the hands of the drivers and passengers. For some customers, security is a concern when traveling with strangers, so setting up a system that lets the passenger immediately contact the support team in case of an emergency should be considered.
This is also useful in cases of basic misdemeanors or issues with the ride. Both sides of the party should have an opportunity to reach out to your customer support team and leave a complaint. You can also introduce penalties on each side when a complaint for a particular user has been registered.
Competitive pricing models.
It is natural to expect a surge in revenue when you open a new business and create a taxi app. However, the wrong move here would be setting unrealistic pricing models during the first months of operations. Users who have never come across your app before and have no experience (positive or negative) using your service are simply not going to try if your prices are higher than those of the mainstream vendors.
Offer a pricing strategy with commissions and fees included that would be competitive against the major brands. This will encourage more clientele to give your app a chance. Over time, you can consider increasing the prices as you build a stronger presence on the market.
Passenger loyalty programs.
While loyalty programs are not a new strategy, not every taxi app includes them in their offer. This could be a winning tactic at the beginning to attract more users and can help you retain them in the future. Luckily, there is a wide variety of different programs you can choose from that will suit your business the most.
The most common are cashback programs, where users can accumulate a certain percentage from each booking and turn them into money-off coupons and special offers. You can create unique and appealing imagery for gifts during the app design process and encourage customers to use your service.
Taxi app monetization strategies
When it comes to taxi applications, you, as the business owner, have several options to capitalize on your success. Luckily, the monetization strategies as a result of taxi mobile app development can be combined, so you are not confined to only one method. Let’s review the most common ways of monetizing your application below.
Main monetization strategies for a taxi app.
- Driver commissions. Businesses can state in their terms of agreement the percentage of the commission taken from each driver as a result of their booking. Usually, it is a small fee of around 20 to 25 cents. However, once you have built a solid network and conducted hundreds of rides per day, that commission fee can add up to a significant sum.
- Service fees. These fees are associated with the price of services and are typically calculated into the final cost of the passenger-side booking. That means you can make money by including the cost of using your taxi app into the cost of booking a ride. This is also a small charge that adds up to a bigger revenue over time as you grow as a business.
- Cancellation fees. While not all taxi apps charge passengers and drivers for canceling a ride once it has been accepted, it is a profitable strategy at the start since these situations are not uncommon. However, you should be careful of charging significant amounts as it can turn away some of the clients from using your app in the beginning.
- Promotions. This may not be a direct source of income, but working with related brands to promote your newly created taxi app can help you build the audience and jumpstart your business. Still, you have to consider that most promotional campaigns require you to invest in them first.
- Advertisements. Ads are not necessarily the popular type of monetization for taxi applications, but they can be implemented to boost your revenue. In some cases, apps can allow users to upgrade to a premium subscription to stop displaying adverts on the screen. However, this strategy is rarely used since the subscription model typically offers other benefits to the customers, like cashback systems.
Limeup can help you create a taxi app
Running a taxi app business can seem like a dream job. With a lot of potential within the market and user penetration rates, the success of an application comes down to diligent development and understanding of what users truly want to see.
In our detailed guide, we have tapped into the nuances of the cab booking niche, the steps you need to take during taxi booking app development, the cost of creating a personalized project, how you can monetize your application, and more. Following the described best practices can aid you on your path to providing a service that will be in demand.
If you want to consult with industry experts regarding your project idea, be sure to contact us, and we will reach out to you to schedule a meeting. At Limeup, we craft unique applications of any complexity and help startups reach their full potential.