We recently caught up with Thomas Heltborg Juul, the CMO of Green Mobility – a successful all-electric Vulog powered carsharing service in Copenhagen, Denmark and Oslo, Norway – to hear about Green Mobility experience in launching in these two cities.
Can you talk about your operating model and what makes it successful?
Our operating model is very simple: no sign-up or subscription fee – you only pay by the minute. A few customers rent a car for a full day or use our subscription with 20 hours pr. month, but they constitute a minority. “By the minute” is by far our bread and butter and still growing. It is no big surprise, considering the nature of the product, as “car on demand” is an add on to walking, bicycling and public transportation. Copenhagen is a difficult but very instructive test case for us with a strong bicycle culture and a competitive public transportation offering with metro, buses and trains available to most people. On top of this, the weather in 2018 has beaten all records for sunny hours and no rain! In spite of this, our business is growing. And one of the key drivers is our customer satisfaction. On the scale from 1-5, our customers rate us 4.11 and more than 90% say they tell friends and family about our concept. This gives us low average customer acquisition costs and high customer lifetime value.
Can you tell us a little bit about your customers and driving adoption? (Marketing, Gamification, User Experience, etc.)
Our customers can be divided into two primary groups. Young citizens aged between 18-30 and families in the edge of the city center aged 40-60. The young group seems obvious. They are born mobile and IoT is a natural part of their mindset. They still do not have the ability to buy a car since a majority is still studying. For this group carsharing is their way of access to a car. 2 out of 3 are young men like in other cities with carsharing.
The other and older group is more tricky and unexpected. Most of them have their own car – or even more cars. They use our service for one-way trips and to position themselves as first movers. The personal branding is vital and conscious consuming and IoT is something most people in this group would like to be related to.
Businesses are also a vital part of our business. We have more than 500 companies using our service to lower their carbon footprint and save costs. Mostly for trips to the airport but also for meetings and commute between different office locations during office hours, where private demand is low. We have not yet cracked the code to the senior segment, but we believe there is an untapped potential out there.
The average trip is 25-30 minutes and most trips start from home. A majority of our users use the car for visiting friends and family or culture events in the city.
We try to engage our users in the management of the fleet by incentivizing them to leave the car at a charging station or simply relocate cars when needed. This is an integral part of our efforts to create a community around Your Citycar.
Electric vehicles are becoming very popular for mobility services, why is it important for GreenMobility to use all-electric cars for its service?
EVs on green power are the future for urban mobility. So is carsharing and we combine the two. We strongly believe in a clear corporate profile and brand, which we can communicate to our stakeholders. Our mission is to make cities more livable with fewer cars, less noise and no emission for the benefit of current and future generations. You can only convey this message convincingly if you are 100 percent green. Full stop. Financially, a completely uniform fleet with only one type of vehicle also makes sense as to maintenance and service.
This strong standpoint also allows our customers to make a statement and push the green agenda to the sometimes foot-dragging politicians.
Could you tell us about the challenges involved with launching a service in Copenhagen and what it taught you for your launch in Oslo?
EVs are not very common in Denmark, so few people have personal live experience with EVs before they hook up with us. That is one obstacle. The second is lack of support in any shape or form from the city hall, who makes life very difficult for carsharing with “no parking here” as a baseline and out of this world parking fees for non-residents. A full day parking in downtown Copenhagen costs more than EUR 60 on public land! This makes it almost impossible for us to service the city center, so we spend many man-hours relocating the cars to less costly areas with less demand. As mentioned before, public transportation and bicycle infrastructure and culture are also very formidable competitors. But if you can make it here, you can make it anywhere!
Driving patterns differ across town. We have been surprised by the fast uptake in the better-off parts of Copenhagen, where larger households with one or two cars have become very-frequent-travelers. We definitely leveraged on our customer segmentation knowledge when we drew the first operating zone in Oslo. The first two years in Copenhagen has also taught us that carsharing is more than a car and an app. This is a base on which you can start building your business. On top of this comes best practice on marketing, sales, operations, products, consumer behavior and a large number of other adapted software solutions. This is a great part of the hard “learning by doing value” we bring to the table to our partners.”
How do you see carsharing and moreover the evolving consumer changing in the next five years? (e.g. competition landscape, technology.)
I believe that we have only seen the beginning of a dramatic change in city dwellers’ lifestyle and consumption, which will redefine streetscapes. The more we cluster the easier we can combat climate change by sharing fewer and fewer cars, that hardly stand still including EV and driverless cars. This will free up space for better use and provide a smaller drag on the planet’s resources no matter whether the economy is labeled linear or circular. The sustainable mindset will in the coming years be the primary driver in our consumption combined with the fact that municipalities will incentivize carsharing and EVs. Add to this that households will evolve from traditional families to more fragmented households. This means we are not sharing the car with our family but with the other citizens.
Autonomous vehicles will also be a part of the equation and we do not see this as a threat to our business – driverless or not. Autonomous cars need fleet management and we can do the job. Instead of our customers picking up a car, a driverless car will pick up our customers ordered via our app. This will replace taxi service – but not within the next 5-10 years. At least in Copenhagen.
Are you a mobility operator? Tell us your story! Contact Us today!
10 July 2019
This week we caught up with Richárd Sáreczky, the Managing Director of MOL Limo, a free-floating carsharing service located in Budapest, Hungary, to learn about how one of Europe’s largest…