Ground transportation & the connected travel fast lane
After Daimler’s most recent investment into the professional driver service Pamela Whitby talks global expansion, tech trends and other industry twists and turns with Blacklane’s chief executive and co-founder
When Blacklane’s Jens Wohltorf co-founded this ‘professional driver service’ back in 2011 it was in response to his own experience as a “heavy business traveller”.
Having crisscrossed the globe for the Boston Consulting Group, he’d never had any trouble booking hotels and flights but, he remembers, there were “enough examples of me being stranded in the middle of nowhere, being out of cash in a taxi or standing in a taxi queue in the rain to know that some heavy optimisation of ground transportation was needed.”
With co-founder and now Blacklane chief technology officer Frank Steuer, the duo set to work and quickly realised that the market servicing the first and last mile in ground transportation was extremely fragmented.
“Around 70% were very small businesses which had no chance to acquire global customers, serve a corporation or perform online marketing. We quickly realised that we could do a lot for both sides of our market place [the traveller and the professional car driver industry],” he says.
Next came “a pretty fast proof of concept” in Berlin which showed that their goal of taking the stress out the first and last-mile in ground transportation was worth pursuing. However, at the time, wven Wohltorf didn’t fully grasp the size of their market an by his own admission says: “Yes, even I’ve been surprised by how fast we’ve grown.”
….even I’ve been surprised by how fast we’ve grown
Jens Wohltorf, chief executive and co-founder, Blacklane
Today the firm serves 200 cities and 400 airports in over 50 countries and with another recent $10 million-plus investment from strategic partner Daimler, the expansion continues. A big chunk of this latest investment will go towards growing the group’s footprint in Asia Pacific and the Middle East where, according to Wohltorf, “we still have some ‘white spaces’.”
To date, the firm’s rapid global growth has been steered out of its Berlin headquarters, but it now has reached a point, particularly on the supply side, of needing regional representation. “As we grow, we’ve recognised that we need to ramp up our team, as well as the location of our teams in order to be able to serve the customer wherever they are,” Woltorf explains.
As a professional driver service, an important part of this process is getting to grips with the legal and regulatory requirements in every jurisdiction, as well as working to ensure that, for example, drivers are properly trained and vehicles comply with quality controls.
Tackling technology, connecting the traveller
Though Blacklane is focused on both the physical and digital experience, like most ‘disruptive’ players strategic tech investments have been central to its success. The firm’s ‘dispatching technology’, for example, has allowed it to undercut traditional limousine and chauffeur rivals because it addresses the issue of under utilisation. For many legacy players, cars are only used 20-30% of the time but Blacklane’s dispatching technology allows drivers to fill that empty capacity, and reduce prices as a result.
In essence, local professional driver companies can grow their revenues without new costs as they add Blacklane’s global customers to their local business, taking as few or many rides as they choose along the way. Another feature is that drivers know their exact rates before they accept rides from the Blacklane platform.
Further technology development and innovation will, therefore, claim the balance of the Daimler injection. One core focus today is on building partnerships across the global travel chain including with online travel agencies, metasearch, global distribution systems (GDSs) and travel management companies and more. “This is extremely technically challenging but something we are pushing ahead with strongly,” says Wohltorf.
A recent example is the recent integration of passenger name record (PNR) data of GDS Amadeus into Blacklane’s system. “The outcome of this time-consuming piece of work is that we can now pull all the data necessary – such as flight, hotel and other personals details - to pick people up at their doorsteps and then deliver them home when the trip is over. All the customer has to do is check another box and this door-to-door experience is in place,” he says.
To date other Blacklane partners include booking.com, Expedia, Lufthansa, Sabre’s TripCase and TripAdvisor’s Viator and Blacklane’s API is playing a crucial role in integrating these travel companies in order to reach travellers wherever they want to book a Blacklane ride. “The flexibility of our API also enables travel companies to offer new and creative services, such as bookings via text," Wohltorf says.
While he acknowledges that there is still a long way to go to fully connect the traveller journey, this is the end game. Ultimately Wohltorf foresees a scenario where the traveller won’t even need to open an app at the moment they need mobility– everything from flights to hotels, ground transportation and even meeting data will be integrated into the booking process. So if a flight is cancelled or meeting time changes that will automatically update the system, and the driver will just be there at the right time. “We are working hard to make this happen and when we do we will have solved the equation,” he says.
Consolidation & competition
Going forward, Wohltorf predicts that growing competition will lead to ongoing consolidation in all corners of ground transportation. Global chauffeur firm Carey International and its proposed partnership with Uber rival Lyft is one example of how this is playing out, as is the recent merger between Didi Chuxing and Uber China. Note too Daimler’s move to oversee a merger between taxi booking apps myTaxi and Hailo, something the Financial Timesviews as an attempt by the German automotive heavyweight to take on Uber in Europe.
Blacklane’s Wohltorf is clear, however, that it is targeting and aiming to perfect the first and last mile of the journey, and is not in competition with inner city mobility services like Uber and Lyft.
It’s not just about getting people from A-B; it’s about taking the stress out of travel at the best possible price point and delivering the best value for money.
What’s is also clear is that “it is mandatory and an essential USP (unique selling proposition)” Blacklane is available worldwide, “operating everywhere where our customers need mobility so they are not stranded in the middle of nowhere”.
And stresses Wohltorf, it’s not just about getting people from A-B; it’s about taking the stress out of travel at the best possible price point and delivering the best value for money. First-and-last mile might be the focus but the target audience is business and leisure travellers and Blacklane is piloting a range of different products and services such as new economy vehicle classes.
Keeping the consumer onside in this fast-moving space will be crucial in years to come, as will forming the right partnerships and watching the latest trends. On the subject of driverless cars, Wohltorf says this is likely to be “the most disruptive trend that our generation will probably ever see”. But they are a few years away and, in his view, there will always be people who want human hands on the wheel.