Skip to main content

Micro Mobility Providers Use AI and Analytics

Urban dwellers have seen shared bikes and scooters popping up around their city. Initially, there was untapped demand. As traffic congestion increased, legacy public transportation couldn't keep up with the needs of a growing population.

Micro-mobility operators were eager to expand, paying minimal attention to developing a sustainable business model. However, now they're forced to evolve from 'growth at any cost' strategies.

According to the latest market study by ABI Research, by reformulating business models, operations, and strategic goals, shared micro-mobility companies can unleash the potential of a market worth $9 billion in ride revenues by 2030.

Micro-Mobility Service Market Development

Most service providers have high idle rates and low profitability in several markets, due to a mismatch between vehicle supply and demand. To thrive in the shared micro-mobility market, operators must now optimally relocate or expand operations based on data-driven insights and analytics.

"It is also imperative to adopt measures to reduce costs that have skyrocketed with the enhancement of vehicle durability, safety, electrification, and recent restrictions and demands made by city authorities," said Maite Bezerra, industry analyst at ABI Research.

Battery charging accounts for 50 percent of the operating costs per vehicle. Combined with rebalancing, they are the highest operational costs in shared micro-mobility.

These costs can be significantly reduced by outsourcing field operations and adopting swappable batteries. Swappable batteries reduce recharge costs by 30 to 60 percent because vehicles do not need to be transported to the warehouse to be charged.

At the same time, charging time can be cut from 4 hours to 15 minutes. When embedded connectivity is available, operators can use cloud-based fleet management platforms to automate vehicle rebalancing, charging, and servicing tasks, reducing vehicle downtime by up to 80 percent.

Moreover, location information enables the development of a plethora of services such as demand heat maps, which can increase vehicle fleet usage by 22 percent in six months.

Data analytics and fleet management platforms use machine learning and predictive analytics to maximize operational efficiencies, optimally expand or relocate existing operations, and ultimately increase ROI based on data-driven insights.

Moreover, they provide quantifiable impact metrics, which are advantageous assets for competitive tender applications. Business model reassessment is another urgent need because presently, ride revenues are insufficient to cover their costs.

Advertising-led revenues, gamification, dynamic pricing, and diversification into last-mile delivery or vehicle manufacturing for the consumer markets are some tools that can significantly increase service provider profitability.

Outlook for Shared-Micro Mobility Market Growth

"Shared-micro mobility operators have a tough road ahead, including the need to downsize or restructure, consolidations, and slower growth rates. However, those who are quick to understand the importance of data analytics and implement efficiency and profitability-based goals will be able to navigate the market successfully," Bezerra concludes.

That said, I believe market consolidation is inevitable, as more service providers choose to address the challenges of market saturation and limited demand over time. The surviving companies will be able to improve revenue and profitability by carefully assessing the market opportunity across the globe.

Regional focus can improve a shared-micro mobility operator's ability to compete effectively with an optimized cost containment model. Costs related to marketing and commercial operations should improve with a carefully targeted market development plan.

Popular posts from this blog

Why Healthcare and Smart City Apps Drive 5G IoT

Fifth-generation (5G) wireless technology for cellular networks is a successor to fourth-generation (4G) wireless technology. By 2023, Juniper Research anticipates that there will be over 1 billion 5G connections globally. The technology will provide the data infrastructure for the advancement of wireless communications and for new developments in the Internet of Things (IoT) -- including smart cities and healthcare. 5G IoT Market Development According to the latest worldwide market study by Juniper Research, 5G IoT connections will reach 116 million globally by 2026 -- that's increasing from just 17 million connections in 2023. Juniper analysts predict that the healthcare sector applications and government or other smart city services will drive this outstanding 1,100 percent growth over the next three years. Juniper examined 5G adoption across key industry sectors -- such as the automotive, mobile broadband, and smart homes -- and forecasts healthcare and smart cities will accoun

How Savvy Leaders Re-Imagine Work in 2023

As we look to the year ahead, there will be significant challenges and opportunities facing the Chief Human Resource Officer (CHRO) role. In order to be successful, savvy HR leaders must be prepared to take proactive steps that adapt and evolve. "HR leaders have faced an increasingly unpredictable environment amid many organizations mandating a return to office, permanently higher turnover and burnt out employees," said Emily Rose McRae, senior director at Gartner . HR Innovation Market Development One of Gartner's key predictions for 2023 is that the use of artificial intelligence (AI) and automation will continue to increase within the enlightened digital workplace. This transition will require HR leaders to develop new skills and competencies in order to effectively manage and lead teams that are increasingly relying on these enabling technologies. Additionally, HR leaders will need to ensure that their organizations are investing in the necessary infrastructure and re

Top 10 CFO Priorities Require Rethinking Finance

The Chief Financial Officer (CFO) role is essential to digital business growth. While CFOs do not get closely involved in the tactical details of the digital transformation of their functions, they still recognize its strategic importance. According to the latest survey by Gartner, CFOs are faced with the challenge of balancing the need for substantive digital business innovation with financial cost control and risk management. "CFOs will be stretched thinly across many activities in 2023. The survey revealed a wide range of actions CFOs plan to either lead or be significantly involved with," said Marko Horvat, vice president at Gartner. Survey Findings: The Top Ten Priorities Cost Optimization - Cost reduction remains the top priority for CFOs as they look for ways to cut costs and improve efficiency in their operations. This includes identifying cost-saving opportunities through automation, outsourcing, and business process improvement. Business Continuity - The global C