Yesterday, the Hailo taxi app had its day in the sun unveiling two new features; Pay Hailo and Hailo Hub.
However, the shadow of the company's withdrawal from the US after failing to successfully take on rivals such as Uber and Lyft still looms large. Things looked good for Hailo when it began its US venture three years ago, with an investment from Union Square Ventures of $30m and plenty of buzz after its success in the UK.
As rival taxi app Uber continues to expand across the globe, why was this British startup forced to back out of the US?
There may be several answers to Hailo's US plight. The first being that local knowledge is crucial in taxi markets and Hailo found it near impossible to replicate the success it had in London to New York.
New York's yellow cab drivers operate in a different environment to their black cab cousins in London. Fotune's Erin Griffith observes that New York's grid system is easier to learn than London's evolved cowpaths. With streets full of willing customers, few yellow cab drivers felt the need for Hailo's services.
Furthermore, while London cabbies equipped with smartphones are par for the course, this is less so in New York. Added to Hailo's woes was an increasingly competitive taxi market, with Uber being the dominant player. As a challenger brand, Hailo had to bring something to the table in terms of either price or service to make good in New York.
This failed to materialise, and Uber upped the ante with the introduction of its cheaper UberX service. Uber is able to offer cheaper prices because of strong volumes, which Hailo lacked.
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Hailo operates in 20 cities, whereas Uber has a presence in 200. Hailo’s revenue in 2013 failed to breach $100m (£62m), and when it came to marketing, Hailo was way out its compared with its San Francisco counterpart. Ross Sleight, chief strategy officer at app developer Somo, writes on The Drum website:
We feel Uber won hands down. With Uber’s deep pockets and aggressive above the line campaign – all-over cab wraps, subway ads and highly tempting promotion codes – it swiftly owned the market with both customers and suppliers. The higher customer demand generated by marketing created more usage and more driver recruitment in a hyper growth virtuous circle.
These may be sound reasons why Hailo failed to break into the US market, but it would still be fair to say even in the UK, Hailo has not mirrored Uber's success in the US. The reason may be that Uber and Hailo are playing very different roles in the fight for the future of urban transportation.
Uber Co-Founder and CEO Travis Kalanick said last year:
In the beginning, it was a lifestyle company. You push a button, and a black car comes up. Who’s the baller? It was a baller move to get a black car to arrive in 8 minutes.
Uber was offering cashless payments long before Hailo Pay, and it challenged taxi monopolies, rather than accommodating them with new technology. A focused strategy in Uber's early years based around targeting cities with a booming nightlife and intense weather had the effect of popularising Uber by word of mouth, even before any well-funded marketing campaigns.
The key difference between Uber and Hailo is that Uber looks to solve the problems of urban living, whereas Hailo, at the moment, appears to do little more than ameliorate them.