OLA (INDIA): BUILDING CUSTOMER LOYALTY TO APP-BASED
SERVICES CASE STUDY SOLUTION
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SYNOPSIS
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Ola India was the pioneer in cab aggregation services in India. In 2019, Ola needed to ensure that it
remained the customer’s first choice for autorickshaw (auto) booking. Ola had so far faced moderate
competition from small players like Jugnoo, but with Uber Technologies Inc. (Uber) re-entering the auto
aggregation market, the competition was likely to increase.1 Autos were traditionally chosen for their low
n
cost and easy availability, and customer loyalty remained a challenge for all players in the market. Some
customers had both Ola and Uber applications (apps) installed on their mobile phones and could easily
tio
make price comparisons before booking (see case Exhibit 2).
To earn customer loyalty, Ola needed to use a multifactorial approach, which would require that the company
lu
focus on app platform performance, vehicle conditions, driver behaviour, technical support services, ease of
payment, promotional offers, and passenger safety. Sam Bora, vice-president and category head of Ola, needed
So
to identify how to ensure customer loyalty and maintain Ola’s leadership position at a time when Uber was
The Case Solution Starts From page 7
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ASSIGNMENT QUESTIONS
1. What is net promotor score? Describe how it is used and its relevance.
2. What is customer loyalty? How do organizations build and lose customer loyalty?. What factors might
be affecting Ola’s customer loyalty?
3. What is the value proposition for Ola in autorickshaw aggregation? Identify the points that can help
Ola gain a competitive advantage.
The Case Solution Starts From page 7
,4. Compare and contrast the strengths and weaknesses of the user interface for the Ola and Uber apps. Compare
the Ola app customer experience with that of Uber and suggest opportunities for improving the Ola app.
5. Discuss the role of celebrity endorsers versus micro-influencers in driving customer loyalty.
6. Should Ola diversify its business model as a long-term strategy? (optional question, if time permits)
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ANALYSIS
1. What is net promotor score? Describe how it is used and its relevance.
lu
So
[A] metric derived from survey responses to a recommend likelihood question. Respondents who
provide a rating of 9–10 are classified as ‘promoters’; respondents who provide a rating of 6 or
lower are classified as ‘detractors.’ Net promoter is calculated by subtracting the proportion of a
firm’s detractors from its proportion of promoters (i.e., net promoter = promoters – detractors).2
NPS needs to be viewed as a management tool that can be used to assess the loyalty of a firm’s customers. It
serves as an alternative to traditional customer satisfaction research and is correlated with revenue growth.3
The Case Solution Starts From page 7
,3. What is the value proposition for Ola in autorickshaw aggregation? Identify the points that can
help Ola gain a competitive advantage.
e
The value proposition for service delivery can be understood by developing a blueprint for Ola (see Exhibit
TN-3.) Ola could gain a competitive advantage by improving the customer experience and customer loyalty.
pl
The key points identified in the service blueprint that can help with gaining this advantage are briefly
discussed below.
m
User interface/app: The user interface plays an important role because it is the first point of experience for
Sa
customers in the chain of service delivery. Ola can gain competitive advantage by further simplifying the
user interface to enable less tech-savvy customers to book autos easily. Certain points to consider would be
displaying prices on the same page as available ride options and making the app available in multiple
languages, both in the Android operating system (OS) and iOS (keeping in mind that India has a diverse
population that speaks multiple languages and that English is not always a preferred language).
n
Delivery system: A number of factors affect the quality of the delivery system. Decreasing the time it
tio
lu
So
The Case Solution Starts From page 7
, EXHIBIT TN-1: E-SERVICE AGGREGATION:
CHARACTERISTICS, CHALLENGES, AND IMPLICATIONS
Characteristics Challenges Implications
The service is No assistance from or interaction with App interface design (simplicity,
similar to self- human service agents intuitiveness, aesthetics)
service. Customer performance of role depends Personalization to accommodate for
on self-learning individual differences and learning styles
Customer perceived control
Customer engagement through the app
Strong back-end customer support
Service is booked
online but
experienced offline.
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Sa
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tio
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The Case Solution Starts From page 7
, EXHIBIT TN-3: OLA SERVICE QUALITY BLUEPRINT
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m
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So
The Case Solution Starts From page 7
SERVICES CASE STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
Ola India was the pioneer in cab aggregation services in India. In 2019, Ola needed to ensure that it
remained the customer’s first choice for autorickshaw (auto) booking. Ola had so far faced moderate
competition from small players like Jugnoo, but with Uber Technologies Inc. (Uber) re-entering the auto
aggregation market, the competition was likely to increase.1 Autos were traditionally chosen for their low
n
cost and easy availability, and customer loyalty remained a challenge for all players in the market. Some
customers had both Ola and Uber applications (apps) installed on their mobile phones and could easily
tio
make price comparisons before booking (see case Exhibit 2).
To earn customer loyalty, Ola needed to use a multifactorial approach, which would require that the company
lu
focus on app platform performance, vehicle conditions, driver behaviour, technical support services, ease of
payment, promotional offers, and passenger safety. Sam Bora, vice-president and category head of Ola, needed
So
to identify how to ensure customer loyalty and maintain Ola’s leadership position at a time when Uber was
The Case Solution Starts From page 7
, e
pl
m
Sa
n
tio
lu
So
ASSIGNMENT QUESTIONS
1. What is net promotor score? Describe how it is used and its relevance.
2. What is customer loyalty? How do organizations build and lose customer loyalty?. What factors might
be affecting Ola’s customer loyalty?
3. What is the value proposition for Ola in autorickshaw aggregation? Identify the points that can help
Ola gain a competitive advantage.
The Case Solution Starts From page 7
,4. Compare and contrast the strengths and weaknesses of the user interface for the Ola and Uber apps. Compare
the Ola app customer experience with that of Uber and suggest opportunities for improving the Ola app.
5. Discuss the role of celebrity endorsers versus micro-influencers in driving customer loyalty.
6. Should Ola diversify its business model as a long-term strategy? (optional question, if time permits)
e
pl
m
Sa
n
tio
ANALYSIS
1. What is net promotor score? Describe how it is used and its relevance.
lu
So
[A] metric derived from survey responses to a recommend likelihood question. Respondents who
provide a rating of 9–10 are classified as ‘promoters’; respondents who provide a rating of 6 or
lower are classified as ‘detractors.’ Net promoter is calculated by subtracting the proportion of a
firm’s detractors from its proportion of promoters (i.e., net promoter = promoters – detractors).2
NPS needs to be viewed as a management tool that can be used to assess the loyalty of a firm’s customers. It
serves as an alternative to traditional customer satisfaction research and is correlated with revenue growth.3
The Case Solution Starts From page 7
,3. What is the value proposition for Ola in autorickshaw aggregation? Identify the points that can
help Ola gain a competitive advantage.
e
The value proposition for service delivery can be understood by developing a blueprint for Ola (see Exhibit
TN-3.) Ola could gain a competitive advantage by improving the customer experience and customer loyalty.
pl
The key points identified in the service blueprint that can help with gaining this advantage are briefly
discussed below.
m
User interface/app: The user interface plays an important role because it is the first point of experience for
Sa
customers in the chain of service delivery. Ola can gain competitive advantage by further simplifying the
user interface to enable less tech-savvy customers to book autos easily. Certain points to consider would be
displaying prices on the same page as available ride options and making the app available in multiple
languages, both in the Android operating system (OS) and iOS (keeping in mind that India has a diverse
population that speaks multiple languages and that English is not always a preferred language).
n
Delivery system: A number of factors affect the quality of the delivery system. Decreasing the time it
tio
lu
So
The Case Solution Starts From page 7
, EXHIBIT TN-1: E-SERVICE AGGREGATION:
CHARACTERISTICS, CHALLENGES, AND IMPLICATIONS
Characteristics Challenges Implications
The service is No assistance from or interaction with App interface design (simplicity,
similar to self- human service agents intuitiveness, aesthetics)
service. Customer performance of role depends Personalization to accommodate for
on self-learning individual differences and learning styles
Customer perceived control
Customer engagement through the app
Strong back-end customer support
Service is booked
online but
experienced offline.
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 7
, EXHIBIT TN-3: OLA SERVICE QUALITY BLUEPRINT
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 7
