13 Apr 18

Ride hailing, who's in?

Ride hailing is hot. However, not everybody is getting warm for this new mobility service with some more likely to participate. Insights in the stereotypical ride hailer might be crucial for ride hailing companies to extend their reach, and for companies planning to introduce corporate ride hailing.

Most studies considering the specific profile of ride hailers focus on the US as it is the most mature ride hailing market and the birthplace of Uber, which owns 77% of the US ride hailing market, providing monthly 40 million rides by 160,000 drivers. By the end of 2016, Uber had provided 2,000 million rides since its launch in 2009. Nevertheless, adoption of ride hailing across income classes and age groups is unequal.

More means more

Ride hailing awareness and usage tend to be higher among more educated Americans. Both a study of the Pew Research Centre and one of UC Davis Institute of Transportation Studies (2017) conclude that college graduates are more likely to adopt ride hailing: 29% of them have used ride-hailing services, versus 6% of the ones who did not attend college. Of the latter, half of them had never even heard of ride hailing before, versus 13% among the college graduates. Additionally, half of Americans living in a household with an annual income below $30,000 were not familiar with ride hailing, and only 10% of them had used it, versus 26% users among the household with an annual income above $75,000.

Age matters

Besides income and education, age matters a lot when it comes to ride hailing. The older one has become, the less likely one has adopted ride sharing. A third of people aged between 18 and 29 have adopted ride hailing and use the service more frequently than the other age groups. Among the 30 to 49-year-olds, the adoption rate is one fifth, and it drops to 4% in the category above 65 years. Overall, the median age of adult ride hailing users in the US is 33.

Neighbourhood is crucial

Another crucial factor is one’s neighbourhood: the more urbanised, the more likely it is to be into ride hailing. A third of people living in cities use ride hailing regularly, compared to 7% in the suburbs. However, this might be a chicken and egg situation as sharing vehicle services tend to be offered in high-density, transit-accessible neighbourhoods, where private vehicle ownership and vehicle miles travelled are already low. In rural areas, more than half of the residents had never even heard of ride hailing apps, and only 3% had used them.

However, culture and gender don’t make a remarkable difference in ride hailing awareness and usage, the geographical factor is crucial. Even rural college graduates tend to have a lower adoption rate (9%) than their urban counterparts (39%). And among the rural residents under the age of 50 only 4% is into ride hailing, versus 28% in urban areas.

Owning or sharing

Another chicken and egg paradox is the one of car ownership, which tends to be lower than average among regular ride hailers. However, it is unclear whether they use ride hailing and don’t own a personal car because of a prior environmental consciousness, or if ride hailing is the cause of not owning a car. To compensate the lack of a personal car, frequent ride hailers tend to use several other means of transportation as well, such as biking, walking, taxis or public transit. Additionally, someone who was already using other means of shared transportation, such as car sharing, might shift to ride hailing services more easily.

Who’s on board?

In short, the most likely person to take a hailed ride is a young (18 to 29 years) college graduate, more affluent (above $75,000 annual household income), men or women, living in a more urbanised area. Addressing people who do not fit into this profile might be both a challenge and an opportunity for ride hailing companies to expand their services among other demographics, and for fleet managers to address, convince and involve the employers who don’t fit in the profile, so everyone gets on board.

Image: girl ordering a ride on her smartphone on the streets of New York.

Author: Fien Van den Steen