Take a trip down memory lane and try to recall the last time you had a great experience in a taxi…and were sober. Maybe the seats were unusually comfortable and the interior impeccably clean. Perhaps you were offered a chilled bottle of water or provided a generous selection of reading material to pass the time. Maybe, a bad experience was turned into a great one–your driver got a little lost along the way, making you late to your destination, so he waived the charge and said “This one’s on me.”
Remember, drunk experiences giggling with friends crammed six deep in a backseat made for three don’t count. We’re looking for genuine examples of good old fashioned customer service and going the extra mile–figuratively speaking.
I’ll give you a minute.
Nothing?
Not even one great experience?
Okay, I’m assuming a lot, but I’m betting that apart from the occasional heartwarming conversation with an East African immigrant who expresses a unique worldview, there are no memorable examples of great taxicab experiences.
Instead, subpar service and above par prices are what can usually be expected. Taxis are typically dirty, prone to getting lost, expensive, and inconvenient. If I had a nickel for every time the “my credit card machine is broken” line was used by a taxi driver, I’d be able to afford a town car in which to parade around town instead of some lowly yellow or neon green taxi.
iTaxi, by Apple
Now ponder another question, if you please. Can you remember a time when you had a bad experience at a McDonald’s restaurant? What about any bad experiences with Apple regarding your iPhone, iPad, or Macbook? How about free services like Gmail, YouTube, or Yahoo Mail? Our guess is you probably haven’t. And if you have, you probably got a free Big Mac or had your iPhone fixed or replaced.
So why is that? Is it because we deal with those companies less often than taxi cabs, so there’s a smaller sample size to examine? Statistics indicate probably not. If you’re like the average human being, you spend a lot more time eating McDonald’s than you do sitting in taxis. Ditto on sending emails and liking your friend’s selfies on Facebook.
It’s true, McDonalds, Apple, Google, Yahoo, and Facebook all understand that unhappy customers are bad for business. But why don’t taxi companies understand that as well? Why is it that no matter where you go in the world, getting in a taxi is considered an almost painful experience? The perception is so widespread that even good taxi drivers have been unfairly branded as con artists and tricksters who can’t be trusted.
Handcuffing the innovators
The truth is, it’s through no fault of individual taxi drivers that service has slumped the way it has. The flexibility afforded entrepreneurs in the tech or food industry is more or less prohibited in the taxi industry. Here are a few examples:
- Fare prices are controlled by a government taxi bureau.
- No spontaneously negotiating prices with customers.
- No additional fees to account for traffic or weather conditions that add time and cost to the ride.
- Restrictions on vehicle production year, model, color, and advertisements.
- Requirement to purchase and display a government-issued medallion to operate in certain cities (New York City’s medallions cost over $1 million each).
Taxi drivers aren’t inherently evil, really.
So what types of problems do all these unnecessary rules create? For starters, they can embitter taxi drivers who find it impossible to grow their income even with extra effort. Some, disaffected by a thankless and unfair system, try to make additional money in unethical ways that cheat customers. There’s a reason why the internationally accepted caricature of a taxi driver is that of an unkempt swindler.
But apart from that, consider how many taxi companies exist in your city. Whatever city you live in, wherever in the world, there’s probably only a handful of taxi companies that control the majority of the taxicab business. In fact, there may be fewer than that in reality, as some taxi companies will create taxi affiliates with different names to present the illusion of choice to customers. Now consider how many different options you have for buying a cheeseburger or a cup of coffee. The choices are seemingly endless.
Ruling the corporate roost
So why are there so few taxi companies? It’s simple, really, most individual entrepreneurs can’t afford to pay the steep government fees necessary to operate a taxicab, so they have to work for one of the big taxi companies instead. They also can’t afford an attorney to help represent them in front of a licensing board or navigate the complicated application process.
As a result, a few big taxi companies dominate the market and grow larger each year. When they discover a competitive threat on the horizon that somehow evades the sand traps of their archaic industry rules, they use their allies at the taxi bureau to pass new ones that further inhibit competitors.
Marketing? We don’t need no stinking marketing
With no competition, why spend money on advertisements or offer special discounts? Can you remember seeing a single TV commercial from a taxi company in the past year? Ever used a coupon to get a discount on your taxi ride? I doubt it.
With no competition to speak of, innovation in the taxi industry is virtually nonexistent. Until now.
Next: Uber, Lyft, Sidecar, and other “rideshare” entrepreneurs who are blowing up the industry–in a good way. Stay tuned…
