The on demand hypergrowth is upon us. In the next 5 to 20 years most of people will be able to get anything within a 5 to 60 minute window. – Gary Vaynerchuk
The on demand app economy allows you to order anything, exactly when you need it. From food delivery, to a ride, to a person to help you build bookshelves, to package delivery, to a spontaneous getaway or a relaxing massage, today’s technology has got you covered it’s all there.
Why is the on demand app category such a rage?
The whole idea of on demand app was built on convenience and mobility, so it was obvious for app development companies to take a centre stage.
Moreover, the on demand app business models got validation with success of Uber and we saw a spike thereafter.
The investors also placed their bets on this sector and fuelled the growth.
#1 Identifying specific pain or problem
Approximately 80% of the US population owns a smartphone, and that’s a huge business opportunity for mobile app developers.
If you are also hit by Uberification trend, then you must know that there are already plenty of apps going behind ‘Uber for X’ model.
The folks at Digital Intelligence Today published an evolving master-list of Uber-style services that match on demand requests with real-time supply.
There have been uberification of almost everything, check for yourself:
- Uber for Liquor Delivery: Saucey, Drizly, Minibar
- Uber for Cannabis Delivery: Eaze, Canary
- Uber for Errands: TaskRabbit
- Uber for Odd Jobs: GladlyDo
- Uber for Hotel Rooms: HotelTonight
- Uber for Beauty Services: Swan, Stylebee, StyleSeat
- Uber for Home Cleaning: Handybook, Homejoy
- Uber for Car Repairs: Yourmechanic
- Uber for Babysitting: Urban Sitter
- Uber for Pizza Delivery: Push for Pizza
- Uber for Medical Equipment: Cohealo
- Uber for Quiet Spaces: Breather
- Uber for Vet (Home Visit): vetPronto
- Uber for Dog Sitters: DogVacay
- Uber for in-home Massage: Massage, UnwindMe, Zeel
- Uber for Doctor House-call: Medicast, Pager
- Uber for Doctor (Remote) Consultation: Doctor on Demand, dvisit
- Uber for Courier Deliveries: Deliv, Postmates, Shyp
- Uber for locksmiths: KeyMe, KeysDuplicated
- Uber for Childcare/School Run: KangaDo
- Uber for Dry Cleaning/Laundry: Cleanly, Dashlocker, Washio, Flycleaners
- Uber for Hotel Dry Cleaning: Oliom
- Uber for Mobile Repairs iCracked
- Uber for Removals: Moveline
- Uber for Lawnmowing: Lawnstarter, Plowz&Mowz
- Uber for Restaurant Home Delivery: Seamless
- Uber for Taxis: Lyft (this is epic)
- Uber for Home Maintenance RatedPeople, HouseCall, RedBeacon
- Uber for Home Decoration: PaintZen
- Uber for Home Deliveries: Anyvan, Doorman, Instacart, UberRUSH
- Uber for Dog Walking: Wortheem Swifto, Urban Leash, Trottr
- Uber for Private Jets: BlackJet
- Uber for City Parking: ParkingPanda, MonkeyParking, SpotHero
- Uber for Language Tuition: Cambli
- Uber for Storage [Valet]: Caddy, MakeSafe, Boxbee
- Uber for Bodyguards: Bannerman
But not every problem is a real problem.
If you have an on-demand app idea you should validate it.
The problem should be frequent not seasonal. For example, Cherry, an on-demand car wash app failed because customers probably didn’t need a car wash every day. Maybe every week, at best.
Semil Shah, a columnist with TechCrunch, compares this situation with Uber, “A marketplace for town cars like Uber is something users could do daily, or even multiple times a day, assuming they have the budget. Uber’s transaction volume is high on two dimensions: repetitive use and high-ticket sales.”
Uber is really successful because people need to move from A to B. But if you are planning a similar service, ask yourself, is this a service that is addressing very specific pain or a problem?
Ivan Hernandez of Digital Loop, said in one of his podcast, “I have a friend who was telling me about an Uber like idea for sharpening the edge of your skis. I asked that person, how often do you sharpen your skis? May be once a year, so how effective is this business model?”
#2 Psychology of convenience
Here’s the thing.
People don’t roll up to McDonalds and order a double cheeseburger off of the dollar menu because it’s cheap. They do it because it’s convenient and because it is engineered to taste good.
The psychology of convenience is what drives the market for on demand apps.
Take a look at this graph.
The distance and the time define what is convenient and what is inconvenient. The more time you have to invest in a particular activity, the more inconvenient it becomes.
In fact, when it comes to online shopping, convenience is the driving force.
Let’s go back to Uber once again. The app has a simple psychological appeal – it promises to buy us time and save us effort- in one word – convenience.
Here’s how convenience model works for service industry:
Now if you look at Uber, it delivers on every count:
- Decision Convenience – Making it fast and easy to choose
- Access Convenience – Making it fast and easy to acquire
- Transaction Convenience – Making it fast and easy to pay
- Benefit Convenience – Making it fast and easy to enjoy/use
- Post-Benefit Convenience – Making it fast and easy to re-purchase
No matter which industry you are in, it’s important to deliver convenience with these must-haves:
- The ability to do live tracking. It is satisfying for the customers when they can live track their order. They feel they have some kind of control over this situation. When they order a service online and can view how far the service is, it actually gives them an assurance and trust. The continuous updates provided by real-time GPS trackers can be viewed by users at anytime from anywhere.
- Frictionless payment. The USP of on-demand mobile apps is the ability to make payments without cash. The process gets more convenient if the payments gateways are frictionless and provide all popular payment options.
- Ratings and reviews. Looking at ratings and reviews can ensure high-quality experience for on-demand platforms, marketplaces, and online companies. Customers go by the word of other customers and choose one service provider over another based on reviews (both good and bad). Ensure regular reviews and Real-time feedback to create a trustable environment. At Uber, a driver’s career depends on his ratings.
#3 Getting suppliers on-board
Think of Uber without its drivers, or StyleSeat without any stylists, or TaskRabbit without its taskers!
Not possible, right?
Yes, even if you are building an online business with your on-demand app, the roots lie in managing and training the actual human beings who will be the backbone of your system.
There are two sides for any on-demand app business – the consumer side and the supply side.
Before you even get started with the consumer side, you have to find the supply for your on-demand business.
- Who will drive the cars for my on-demand taxi app service?
- Who will deliver groceries for my on-demand grocery store app?
- Who will consult the patients for my on-demand medical consultation app service?
Again, there’s a lot to learn from on-demand taxi app, Uber. See how they ensure rising popularity by expanding their services.
Related: On-demand physicians –your guide to telehealth app development
Try these techniques to get your suppliers on board:
Cold calling works when you are no one
Uber got its first few drivers in San Francisco when Travis Kalanick, Uber’s CEO, made cold calls and asked the licensed drivers to join Uber.
“First 10 guys I called, 3 of them hung up, a few of them listened for 45 seconds and then hung up and 3 of them were like, we are interested, let’s meet. If you are cold calling and got 3 out 10 those are interested means you got something,” – Travis Kalanick, Uber’s CEO.
Clearly compare the remuneration and perks of association
Uber clearly states and compares the earnings of its drivers per hour. But it also highlights the requirements like- cover your own gas and vehicle expenses. Before you decide make sure to consider all the factors. But Uber tells the prospective drivers – “The great news with Uber is that you’re the boss.” – now that’s a big incentive.
Lay clear ground rules
The supply guys need to be found and ground rules should be set even before you launch you app. For example, StyleSeat gives out detailed guidelines for anyone who wish to list their business on the app or become a stylist.
State every possible situation and the rules for that. For instance, what if the customer cancels the order at the time of delivery? What impact will it have on the supplier?
#4 Integrating the technology
An on-demand mobile app actually consists of three distinct applications. One client facing app that is intended to be used by the end user who is availing the service, a service provider app that runs on the device of the personnel delivering the service and an admin app that functions as an intermediary between the two.
Building an on-demand app thus requires you to integrate a host of different features across the three sides of the applications. Here are some of the things that need to be taken into consideration while designing and developing the app, while being mindful of app development timelines.
Push notifications are an integral part of on-demand apps. A notification needs to be sent out on the service provider’s app as soon as a customer seeks to avail their service to draw their immediate attention. Push notifications also need to be sent out to the client app to notify them about the upcoming delivery of the service.
Successful implementation of in-app notifications is a tricky task. They need to be engaging enough to keep the customers opening and using the app and yet give enough space to not feel too pushy to be considered an annoyance. The key to successful implementation of push notifications is striking the right balance between the two.
Real time location tracking
Live location sharing has become an integral feature of an on-demand app. The customers need to be able to see the status of their order and the expected time required for delivery. This can only be possible by integrating location based APIs within the app.
Location also factors in when there are multiple service providers and the location of the service provider is a determining factor in raising a request for the service. Uber for example sends out the request to the drivers who are closest to the customer location as a part of their matching algorithm.
The payments system incorporated within the app needs to be fast, reliable and secure. The app user has limited patience when it comes to waiting for the payment functionality to load. If the processing of payment via app is slow or doesn’t feel secure to the user, the probability that the users would drop your mobile application in favor of competition is high. There are a number of third party platforms to choose from for processing of mobile payments in an on-demand app.
At our healthcare software development company Arkenea, we make it a point to integrate multiple payment options within the mobile app including online payment, credit cards and payment gateway processors such as PayPal and Stripe. This gives the user options to choose from and leaves them empowered to make a choice. The SDKs of the payment platforms can be easily integrated by the developers within the app.
When it comes to designing the UI of the payments section of the app, every small detail matters. The formatting must be automated when the users enters their credit card details to reduce the chances of error. The users should have the option to save their details if they choose to do so. The payment in turn has to be secure for the customer trust to be present. Even little details like having a lock icon display next to the pay option builds up the user trust.
#5 The Matching Algorithm
Matching logic of an app determines which service provider is to be allocated to a new customer request. It is important for an on demand app how it matches the two sides.
These apps don’t match and route people manually. Instead, software and underlying algorithms make these technologies work. There are two algorithms for matching demand and supply in an on-demand app:
Automatic matching that takes place when logic to assign (or shortlist) service providers is built into the application code.
Manual matching where app administrator manually assigns the customer request to one of the service providers (works for businesses with small volume of transactions).
In fact, this demand and supply ratio can also influence the market prices.
Travis Kalanick told Wired in 2013, “[Uber is] not setting the price. The market is setting the price. We have algorithms to determine what that market is.”
To ensure these matching algorithms works successfully for your on demand app, you need to consider these factors:
Pursuing local first
Jumping straight into a national-scale service can be a mistake. You must have significant consumer demand for what you’re selling and freelance suppliers ready to meet the demand in an instant. You need to start locally for these algorithms to work.
PostMates provides the best roadmap for growth:
- Create a small, local service.
- Iterate until it’s perfect.
- Expand and repeat.
Use technology to build trust
Trust can bring more and more customers on board.
In a TED talk on how reputation is the new capital, founder of the book “What’s Mine is Yours,” Rachel Botsman talked about how technology is key to build trust and to empower each other to make meaningful connections and eventually start sharing.
Rachel said, “The real magic and the secret source behind collaborative consumption markets like Airbnb isn’t the inventory or the money. It’s using the power of technology to build trust among strangers.”
Manage suppliers and active jobs
One of the most challenging aspects of building an Uber for X business is connecting disorganized consumer demand with disorganized suppliers. You will not actually employ these suppliers but will still have to manage them through cloud. Ensure, your backend services are solid to manage the data/information about the suppliers and customers both.
How can you go about building an on demand app?
Following an Uber for X model and building your own on-demand mobile app requires significant attention to detail. This involves minding several nuances with separate back-end and front-end coding and integration of several sub-systems.
Because of the innate complexity involved in building an on-demand app, turning your app idea to reality necessitates that you partner with an app development agency that has the relevant experience, understands your needs and requirements, is poised to provide you with the solutions you need to make your app work. This is where Arkenea comes in.
The Arkenea Advantage
- 10+ years of helping healthcare entrepreneurs and fast growing healthcare companies build on-demand apps.
- A ton of client successes – whether it is being featured on app stores, raised millions in venture funding, generated several million dollars in revenues or had a successful exit, we’ve seen all in our portfolio.
- We partner with you in success – you come to us with an idea and we help take it to market. We even help you raise money for future iterations and marketing.
- Get in touch with us for a free quote. Click contact us at the top right of this page.