As cities are getting more crowded and driving through them by car takes ages because of traffic, getting around by bikes or electric scooters is gaining in popularity.
Every day, more and more people choose to transport by electric scooter. It is not only more efficient but also fun. So, is jumping into the scooter sharing business a gold mine? Yes, it can be.
To conquer this niche, you need to have e-scooters and build a scooter sharing app like Lime, TIER, or Bird.
In this article, we’ll go through all the important aspects of this business, starting from the insights into the e-scooter sharing market, details and nuances of the e-scooter app development and what to do if you want to jump into this niche.
Scooter sharing: what is it?
Scooter sharing, also known as scooter rental or scooter sharing services, is a transportation model where electric scooters are made available to the public for short-term use on a shared basis, via a simple scooter sharing app.
It’s a part of the larger concept of micromobility, which focuses on providing convenient and sustainable transportation options for short-distance trips within urban areas.
Insights into the e-scooter sharing market
The e-scooter sharing market, beside being a relatively young and fresh niche, is rapidly growing and has gained significant traction in recent years.
Now, let’s go through the most significant insights of the industry.
Market growth
The e-scooter sharing market has experienced impressive growth worldwide. The convenience, affordability, and eco-friendly nature of e-scooters have attracted a large user base, particularly in urban areas. According to industry reports, the market size is projected to reach billions of dollars in the coming years. And the market is actually gaining momentum. Apps like BIRD and Lime have raised a combined $1.48B in funding as of 2019. Also, according to Berg Insight forecast, scooter sharing fleets will offer 2.6 million globally by the end of 2023.
Urban mobility solution
Electric scooters have emerged as a popular mode of transportation for short-distance travel within cities. They provide a convenient and efficient alternative to cars, bikes, or public transportation, especially for last-mile connectivity. Simply put, in a short period, e-scooter sharing apps have become an integral part of the urban mobility ecosystem.
Demographic appeal
Commuting by e-scooters appeals to a wide range of demographics, including students, tourists, and leisure riders. Why?
E-scooters are very easy to use, are widely accessible, and affordable pricing make them attractive to a diverse set of users. Additionally, the younger generation, particularly millennials and Gen Z, are more likely to adopt and embrace e-scooter sharing services.
Regulatory challenges
The e-scooter sharing industry faces various regulatory challenges. Different cities and countries have different regulations and permit requirements, making it necessary for operators to navigate complex legal frameworks. Compliance with safety standards, parking regulations, and addressing concerns about sidewalk clutter are key areas of focus for operators and city authorities.
Competition and market consolidation
The whole market is highly competitive, with several major sharing mobility companies with apps like Lime, TIER, or Bird and numerous smaller operators vying for market share.
This competition has led to rapid innovation, improved services, and aggressive expansion strategies. However, market consolidation is also occurring, with larger players acquiring or partnering with smaller companies to strengthen their market presence.
Operational efficiency
Ensuring operational efficiency is crucial for e-scooter sharing companies. Efficient fleet management, maintenance practices, charging infrastructure, and real-time monitoring of scooter availability are essential to provide a seamless user experience and maximize utilization rates.
Sustainability and environmental impact
E-scooters contribute to reducing carbon emissions and alleviating traffic congestion in cities. By promoting sustainable transportation options, e-scooter sharing companies align with environmental goals and support cities' efforts to create more sustainable and livable urban environments.
Safety and education
Safety remains a top priority for the e-scooter sharing industry. Operators are investing in safety measures such as rider education programs, helmet requirements, and improved scooter designs. Collaborating with local authorities, communities, and users to promote responsible riding practices and increase awareness of safety guidelines is essential.
Data and analytics
E-scooter app development generates vast amounts of data that can provide valuable insights into rider behavior, usage patterns, and traffic flow. Companies are leveraging this data to optimize operations, improve fleet management, and collaborate with authorities for better urban mobility planning.
Integration with mobility ecosystem
E-scooter sharing similar to car sharing apps, is increasingly becoming integrated into the broader mobility ecosystem. Partnerships with ride-hailing services, public transportation providers, and other mobility platforms aim to offer seamless multimodal experiences for users, facilitating efficient and sustainable urban transportation options.
Obstacles to overcome
As this market is, in fact, prospective and will develop in the future, there are some obstacles to overcome. And it’s not only about the competition e-scooter companies like Lime, TIER, or Bird. Unfortunately, it’s more complex.
So, what challenges are waiting for you in the scooter sharing app industry?
Obtaining local permission
The regulatory landscape surrounding e-scooter rental businesses can be complex and varies across different cities and countries. Navigating local regulations, permits, licenses, and compliance requirements can be challenging and time-consuming. It's crucial to thoroughly research and understand the legal framework in your target market to ensure a smooth and lawful operation.
Securing funding
Most of the current e-scooter companies operate with the major support from the venture capital. If investors lose interest in the electric scooter app development or switch to some new niche, these companies are in serious danger.
Of course, big e-scooter companies like Lime, TIER, or Bird don’t have to worry about this that much, because, having in mind that they’re rich, they can afford the risk of losing some money and still stay afloat.
If you're a newbie in this business, however, it will be extremely difficult to survive without 3rd-party investments. Especially at the beginning of your journey.
Another possible scenario for smaller e-scooter companies would be merging with the major ones. Simply put, the big players may buy the smaller ones to avoid competition. According to some industry news, Uber is planning to buy Lime or Bird, or even both!
Apathy of commuters
E-scooter rental businesses have faced criticism from some communities due to issues such as sidewalk clutter, improper parking, and safety concerns. Building positive relationships with local communities, addressing their concerns, and implementing effective communication and educational campaigns are crucial to foster acceptance and avoid potential conflicts.
Lack of micromobility infrastructure
E-scooters require regular charging to remain operational. Establishing a reliable and efficient charging infrastructure is essential. Identifying suitable charging stations, managing battery life, and optimizing charging processes to meet demand can be a logistical challenge that requires strategic planning and collaboration with relevant stakeholders.
Business seasonality
Scooter-sharing demand can be affected by seasonality and weather conditions. Adapting operations to handle fluctuations in demand during different seasons and mitigating the impact of adverse weather conditions is necessary for sustainable business growth.
Benefits of starting a scooter sharing business
As you can see, the future of the scooter sharing business seems bright and very promising. So now, let's go through the benefits of starting such a business.
Growing demand
There is a growing demand for alternative transportation options, particularly in urban areas. Scooter sharing services provide a convenient and eco-friendly mode of transportation for short-distance trips. As cities become more congested and people seek sustainable mobility solutions, the demand for scooter sharing is expected to increase.
Cost-effectiveness
Compared to traditional modes of transportation like owning a car or using taxis, scooter sharing is often a more cost-effective option. Users pay for the time they use the scooter, making it affordable for short trips. This affordability attracts a wide range of users, including students, commuters, and tourists.
Reduced traffic congestion
E-scooter app development can contribute to reducing traffic congestion in cities. By providing a flexible and efficient mode of transportation, scooters can help alleviate traffic on busy roads. They can also be a useful option for the last mile of a journey, connecting people to public transit and reducing the need for personal vehicles in crowded areas.
Environmentally friendly solution
Electric scooters used in the sharing services are powered by clean energy sources and produce zero direct emissions. This makes them an environmentally friendly transportation option that contributes to reducing air pollution and greenhouse gas emissions. By choosing electric scooters over gasoline-powered vehicles, scooter sharing businesses can promote sustainability and support greener cities.
Flexibility and convenience
Scooter sharing apps like Lime offer users the flexibility and convenience of on-demand transportation. With smartphone apps, users can easily locate, unlock, and ride scooters whenever needed. This flexibility makes scooter sharing attractive for short, spontaneous trips, avoiding the hassle of parking or waiting for public transportation.
Technological advancements
The scooter sharing industry is evolving rapidly, with advancements in technology and data analytics. Companies can leverage this technology to optimize fleet management, improve operational efficiency, and enhance the overall user experience. Integration with mobile apps, GPS tracking, and remote diagnostics enable real-time monitoring and maintenance of the scooter fleet.
Business scalability
Scooter sharing businesses can scale their operations relatively quickly. With a flexible fleet size, businesses can expand or contract based on demand. This scalability allows companies to test new markets, adapt to changing user preferences, and potentially expand to multiple cities or countries.
Partnerships and integration
Scooter sharing businesses can explore partnerships and integration opportunities with other transportation services. Collaborations with public transit systems, rideshare platforms, or parking companies can provide additional avenues for growth and revenue generation.
Critical steps of the electric scooter app development
Design a user onboarding flow
The best e-scooter sharing apps have succeeded because they are super easy to use. Remember to design your app user onboarding process to be as simple and intuitive as possible, enabling users to start riding scooters right away.
Another good idea here is to add an interactive tutorial explaining how to easily rent an e-scooter, with some tips on how to safely use the vehicle and end the renting.
Integrate a 3rd-party map API
This is another feature that will make using your scooter sharing app more pleasant and increase overall user experience. Integrate a 3rd-party map API into your app to make users easily find e-scooters that are close by. When it comes to Android apps, developers usually tend to use Google Maps or Mapbox, whereas on iOS devices – MapKit framework.
As it’s one of the most important features of the scooter sharing app, it has to be done right. The integration process itself isn’t that difficult but still requires skills and experience. If you don’t have developers with such experience on board, it’s always better to ask for help from location-based services experts.
Implement real-time GPS tracking
Real-time GPS tracking is a crucial feature that allows users to track their routes and get directions to their destination points. It’s a must-have feature for e-scooter companies and their apps like TIER, for instance.
To implement real-time tracking in an Android app, your developers can simply use Google’s Location API. Whereas when it comes to iOS devices, in most cases the choice falls on the CoreLocation framework.
Read more: If you’re looking for knowledge about building an e-scooter sharing app, or any different location-based app, be sure to read our article about top 12 AWS services for building an Uber-like location-based startup.
Integrate QR code scanner technology
Apps like Bird allow their users to unlock e-scooters just by scanning the QR code which is usually placed on the handlebars. Thanks to that easy solution, renting a scooter is super easy and fast, which is another plus for the UX of your app.
Implement a smart lock feature for your scooters
Scanning QR code doesn’t have to be the one and only method for unlocking an e-scooter. To provide an even better, more fresh and user-friendly interface for your scooter sharing app, give your users the ability to unlock them via a smart lock feature.
This technology enables keyless locking/unlocking of a rented scooter.
How does it work?
A scooter will automatically unlock as soon as your users approach it and, similarly, lock when they leave. But, to make it work on your scooters, you need to provide your fleet with a smart system-on-a-chip (SoC).
Design a simple booking process
No one likes that feeling when they finally find a scooter, try to rent it and boom, it occurs that the vehicle is already booked by someone else. Especially if they wanted to get somewhere fast and there are no free scooters nearby.
Enabling your users with the booking feature lets them not only ride, but also book scooters and plan trips in advance.
Enable in-app payments
To make the whole experience with your app easy and seamless, remember about integrating credit card processing gateways to accept cashless payments from your users. As there are plenty of payment providers on the market, we suggest using one of these three: Stripe, PayPal, or Braintree. These companies are globally-known providers of payment options in mobile apps, so you can be sure that both your and your users’ money and data will be safe and well-protected.
If you decide to use Stripe, they offer their own Android libraries and card input widget. Whereas for iOS, they’ve developed a dedicated Stripe SDK.
How to monetize your scooter sharing app
Monetizing a scooter sharing app requires careful consideration of various revenue streams that can generate sustainable income. Here are some common strategies to monetize your scooter sharing app:
Ride fees
Charging users for each ride is a straightforward monetization method. You can set a base fee for unlocking the scooter and an additional fee based on the duration or distance travelled. This model allows you to generate revenue directly from the usage of your app and scooters.
Subscription plans
Offer subscription plans for frequent riders who want to enjoy certain benefits or discounts. These plans can include features like reduced ride fees, priority access to scooters, or exclusive promotions. Subscriptions provide a steady revenue stream and encourage customer loyalty.
In-app advertisements
Collaborate with local businesses or brands to display targeted advertisements in your app. This can include sponsored content, banner ads, or pop-up ads. Ensure that the ads are non-intrusive and relevant to your users to maintain a positive user experience.
You might want to avoid integrating with large ad networks like Google’s AdSense to not bloat your UX with annoying and badly design adverts.
Partnerships and sponsorships
Form partnerships with local businesses, restaurants, or retail stores to offer exclusive discounts or rewards to your app users. In return, you can negotiate revenue-sharing agreements or receive sponsorships from these partners. This strategy not only generates income but also enhances the value proposition for your users.
Data analytics and insights
Collecting and analyzing data about rider behavior, traffic patterns, and popular routes can provide valuable insights to local authorities, urban planners, or transportation companies. By offering anonymized data reports or selling data access, you can monetize the valuable information generated by your app.
In-app purchases
Offer additional services or features within your app that users can purchase. For example, you could provide premium access to high-performance scooters, extended rental durations, or helmet rentals. This allows users to customize their experience while providing an additional revenue stream to your business.
Partnerships with service providers
Collaborate with complimentary service providers such as parking facilities, food delivery companies, or charging station operators. By offering integrated services or seamless access to these partners, you can negotiate referral fees or revenue-sharing arrangements.
White-label solutions
Consider offering a white-label version of your scooter sharing app to other cities or organizations interested in launching their own scooter sharing services. This can generate revenue through licensing fees or revenue-sharing agreements.
Data-driven advertising
Utilize the data collected from your app to offer targeted advertising to local businesses. By leveraging user demographics, location, and preferences, you can provide highly effective advertising opportunities to businesses looking to reach a specific audience.
Corporate partnerships
Collaborate with companies or organizations that promote sustainable transportation or have a large employee base. Offer corporate plans or partnerships that provide discounted rides or dedicated scooter parking for their employees. This approach can generate consistent revenue through bulk agreements or membership fees.
Summary
Getting into e-scooter app development can be, for sure, a great business idea. It’s a solution that has a big potential to become one of the leading commuting services for people living in big cities. And, as you could read above, attracts big names to invest in the development of the scooter sharing apps.
On the other hand, it's a very complex and demanding process, both from the business and technical side. So, if you’re wondering about building your own app like Lime, TIER, or Bird, and you’re not so sure that you can handle it on your own, don’t hesitate reaching out to electric scooter app development agencies like RST Software.
As a team of experienced experts in location-based services, map development and geospatial data visualization, we will be happy to help you build your own e-scooter sharing app from the very beginning!
Simply drop us a line at hi@rst.software and we’ll take it from there.
