Self-positioning as a Thought Leader
Throughout my life, I constantly travel, which sometimes causes some inconvenience. My family always used the car for the trip and took a few passengers to reduce the cost of the journey. As a result, parents told acquaintances the time and direction of the place, and there were always many willing to join. When I grew up, my parents bought a supercar that could hold many passengers because there were so many people enthusiastic about going with fellow travelers.
During the last trip, I asked my parents to start a business based on private passenger transportation. The family successfully approved my idea, so the question arose of creating a viable business plan. As the author of the concept, I suggested possible ways to perform a broad customer base and attract investment. It is also essential that the number of drivers and vehicles had to be expanded, so I thought it wise to create a website that would enable every responsible citizen to try themselves in this role. It is crucial to rethink the existing transport proposals and design a system that would permit drivers to develop and meet client needs. Thus, there is an apparent demand for private commercial transport in this region, and my team can successfully meet it.
Sector Scholarship
Do you know how to safely get to your destination in the North of Canada without spending excessive airfare? It is a well-known point that it is one of the largest countries in the world, which means that the issue of overcoming long-distance is more acute than ever, especially in certain regions. The vast population in the North is indigenous, and because of their particular demographic, cultural, socio-economic, and socio-political status, they represent a unique cohort of people. They often remain isolated and have access only to air transportation since transit services by road are virtually nonexistent (Tretheway, 2021). It is also due to the particular climatic conditions, as large amounts of snow and ice create highway and rail functioning problems.
It has resulted in a monopoly for airlines, which in turn causes poor service, long flight delays, and high fares. Citizens are forced to pay exorbitant sums to buy passes to the nearest city (an average of $2,000 per round-trip ticket per person) because the cost of flights is relatively unregulated by local authorities (Shaheen and Cohen, 2019, p.428). However, with the development of transportation infrastructure, there are new opportunities to traverse the climate without spending much money.
Developed and modern road transport can be an excellent alternative to airplanes. Already, it holds the lead position in passenger traffic in Canada. The question is, can every average family in the North afford to buy a car? Despite a reasonably high standard of living, the answer is no. The unemployment rate among indigenous people in northern communities is 19%, which leads to adverse consequences (Shaheen and Cohen, 2019, p.428). Therefore, there is a need for a high-quality service that will make travel safe, comfortable, and most importantly, affordable.
Shared travel service is one of the best alternatives to replace the airlines and spread their power in the North. Introducing such a system will create effective competition and allow people to travel by car when they cannot afford to buy their own (Tretheway, 2021). It is proposed to create a unique website and a mobile app that will allow customers to choose a route and the driver, period, and price, among several alternatives. The price should be determined by the distance and time of day when the trip is to be made. This type of service, tailored to a specific region, is the most effective solution. Not only will it create travel opportunities, but it will also provide additional jobs and therefore cause a positive economic impact.
Customer Base
One of the main problems for a business owner is how to find clients. As it is, the success of entrepreneurs depends on them. Hence, if there are no clients – even the most prosperous startup will not achieve results and will fail. Therefore, it is crucial not only to create services but to launch them on a market that has a demand for them. It is possible to build a customer base because of the CRM system. Its advantage is that it is aimed entirely at the client and includes a sales history, customer database, payment calendar, records of marketing activities, calls, and letters.
Additionally, the proposed startup can set up a customer base, and it’s crucial to provide organic search, which will include Internet advertising, email, newsletters, media activities, and online events. The system clearly defines the source channel and assists in analyzing the effectiveness of each. The CRM will calculate not only the number of possible people attracted to the channels but also their conversion rate into a sale. The collected analytics will show which channels need to be strengthened and which require to be disabled (Thakur and Workman, 2016, p. 4095). Thus, the CRM will help select only buyers interested in traveling by car. Once the startup has a primary base of possible customers, the CRM will support establishing communication through messaging and emails. In this way, customers who have already traveled will be capable of receiving mass notifications about discounts and the opening of new itineraries.
The way of working with clients includes a sales funnel. That is, booking a seat in a vehicle and making (organizing) the trade is a lengthy process. Then there is an opportunity to investigate why the customer chooses a particular direction and company for execution tasks. The CRM system in the proposed startup is aimed at the client. If it is clear that a potential customer has not been using the service for a long time, the system automatically moves him to the beginning of the sales funnel (Thakur and Workman, 2016, p. 4096). That is, marketing techniques are again practiced to bring the buyer back into the customer base.
Meanwhile, it is crucial to apply the framework of digital marketing in the transport business. During the customer base building stage, a firm can use social media and forums to spread the word about the brand. That is, social media, with the aides of targeting, will better inform potential purchasers (Thakur and Workman, 2016, p. 4098). Moreover, considering that future customers need to register in the application, it is essential to maintain buyers’ interest so that they do not cancel subscriptions. Hence, here are a few ways to create and support a customer base for a private passenger transportation startup.
Planning for Growth, Scaling, and Challenges
With an active business turnover, there is nothing more important than growth and scaling strategy in today’s world. The concept of carsharing is new in the territory of Northern Canada, and it does not have a lot of competitors. Therefore, it has all the chances to retain a good position in the market. Additionally, just one of these facts will not be enough for the efficient operation of the service and its development. Consequently, it is necessary to gradually use new technologies, which create new types of services adapted to customers’ needs. One of the possible options is to digitize the process of paying for trips, which will increase the quality and level of satisfaction with traditional services.
Furthermore, according to the conditions offered by the driver, different types of travel can be introduced. It will allow passengers to get more choices at a price they can afford. Another essential prerequisite for development is a sound system of customer calls. All input and output data must be analyzed and used to improve the performance of the service. Only knowing the exact demand and offers for transportation in a particular city in real-time will optimize the prices of trips and make the market more efficient (Okrah, Nepp, and Agbozo, 2018, p.230). The key stimulating factor for scaling up is client data, innovative business models, and digital technologies. The idea of growth is simple; it is necessary to consolidate income by employing a high-quality and personalized service and expanding different types of services.
Moreover, automated suggestions can be implemented to accelerate growth and increase customer satisfaction with the platform. It will allow users to leave feedback, which will be available to all (Okrah, Nepp, and Agbozo, 2018, p.231). It, in turn, will increase the number of reviews on the site, which will stimulate bookings and increase the customer base. By comparing the value proposition and the customer profile, the startup can transform the service or product according to market requirements.
The first challenge for the platform is that supply and demand are dynamic, and effectively matching them in real time is not simple. Service availability is paramount, so it is necessary to make every operation idempotent, which, in practice, can be challenging. Information regarding behavior, needs, and desires is quite extensive. The lack of clear differentiation and a combination of these elements can create chaos and reduce performance (Okrah, Nepp, and Agbozo, 2018, p.234). To reduce the risks posed by this problem, the efficient use of resources and time should be the priority. It is also crucial to study the experience of other successful companies, which cope with a large volume of demand and provide the same result in the provision of services.
Another problem that can occur on the way to the development is the lack of trust among the users.
Although the idea is not new, it has not existed in Northern Canada, so people may be afraid to get into someone else’s car. It is essential to convince them that it is safe, and quality services serve to confirm this. An advertising strategy that will develop updates and benefits for customers should be applied. For example, it could include more information about the driver and his car (Okrah, Nepp, and Agbozo, 2018, p. 237). Furthermore, each trip would be tracked, and if there were complaints of rule violations by the driver or passenger, their accounts would be blocked.
Moreover, a post-trip evaluation system can be created to determine the rating, based on which everyone will choose the best service provider. Payments will be made directly after the completion of the trip, which will make it impossible to use financial fraud (Mussapirov et al., 2019, p. 1476). The administration of the site will monitor the objectivity of the information specified in the profile, check the passport data of the performers, and block the possibility of making a ‘cheat’ rating or reviews.
Another challenge is that the service is centered around one central figure — the customer. It is certainly not a bad strategy, but economic, environmental, political, and technological factors should also be included when introducing services. Specific local knowledge, the city’s layout, demographics, and local transportation system must be considered when setting long-term goals (Mussapirov et al., 2019, p. 1478).
Therefore, it is required to involve experts who will provide a comprehensive assessment of the region and develop a strategy for adapting the services. It is crucial to include weather conditions here because large amounts of snow and ice can be an obstacle to safety on the road. That is why it is vital to determine the usual standards that the vehicle must have to travel.
Funding Sources
In order to be a competitive business, a startup requires funding. As a rule, there are not enough personal reserves for business development and work. Therefore, contributions from an external source perform an essential role. One of the most winning methods of attracting investment at the initial stage can be crowdfunding. The low cost of implementation and unlimited access to different platforms have opened an easy way to create a business.
This method effectively raises capital with low risks for aspiring entrepreneurs looking to turn their ideas into reality. Crowdfunding allows representing interests on an equal footing with other, more experienced participants. It provides a method to obtain the funds needed to launch an idea quickly and with the support of an engaged community (Menon and Malik, 2016, p. 152). It is a valuable financial strategy for a car-sharing service because it helps promote the idea of the project through the online platform and generates media attention. It allows us to point out the goals of the project, plans for profits, how much funding is needed, and for what reasons. Then, consumers can review the information and invest money, provided they like the idea.
Furthermore, since the concept of the approach already exists on the market, many people may already have experience using such a service. They will be able to provide feedback and share their experiences even before the realization stage. Moreover, this will be an excellent way to test the reaction of the population of Northern Canada to the concept; based on that, a conclusion can be made about how the product will be marketed (Menon and Malik, 2016, p. 120). In addition, this way of financing will allow gaining the audience’s support because the payers can become the most loyal customers. Equally important is the fact that crowdfunding allows tracking the company’s progress. Therefore, after the growth of the business, it will be possible to attract Angel investors who will already understand the original purpose of the service.
The principle of such involvement is based on the fact that wealthy people choose the most successful projects in their opinion and lend their own money to them. It is crucial that such investors need to be attracted in the early stages of the project launch. In addition to finances, they also contribute more to the company – experience in its activities and management skills, which are usually lacking in companies in the early stages and their connections (Menon and Malik, 2016, p. 123). At the same time, this type of investment is the riskiest due to the fact that humans invest their own money.
Accordingly, I can apply this method of investing in the proposed startup as the product and system of creating a base of clients are developed in detail. Given the economic benefits for future users, it is obvious that the project will be popular. Moreover, it is essential for the Angels that the plan owners already have experience in the transport market (Menon and Malik, 2016, p. 123). Therefore, it is exceptionally significant that before creating a startup, the family practiced joint trains for many years to save money. Thus, it allows for predicting possible demand and profit.
The quest for private investors should start after drawing up an estimate of the startup, which should be submitted together with the project to the investor. The search for investors can be carried out on special exchanges, usually for such startups in the region is not long. Thus, the advantages of using Angel investors are that they are willing to invest large sums of money in unknown startups. As a result, Angel investors will support the company’s growth until the startup makes significant profits.
List of References
Menon, K. and Malik, G. (2016) Funding options for startups: A conceptual framework and practical guide. Chennai: Notion Press.
Mussapirov, K., et al. (2019) ‘Business scaling through outsourcing and networking: selected case studies, Entrepreneurship and Sustainability issues, 7(2), pp. 1475–1480.
Okrah, J., Nepp, A., and Agbozo, E. (2018) ‘Exploring the factors of startup success and growth’, The Business & Management Review, 9(3), pp. 229–237.
Shaheen, S. and Cohen, A. (2019) ‘Shared ride services in North America: definitions, impacts, and the future of pooling’, Transport Reviews, 39(4), pp. 427-442.
Thakur, R., and Workman, L. (2016) ‘Customer portfolio management (CPM) for improved customer relationship management (CRM): Are your customers platinum, gold, silver, or bronze?’, Journal of Business Research, 69(10), pp. 4095-4102.
Tretheway, M., et al. (2021) ‘Northern and Arctic air connectivity in Canada’, Proceedings of International Transport Forum, Vancouver, Canada. doi: 10.1787/76573c8d-en