Should Google get into the ride-sharing market?

Clarification:

• Can I assume "The ride sharing market" is about services like Lyft or Uber where users can request rides? [Yes]
• Can I assume "get into the market" means broadly any integration, optimization related to the market? [Sure] 

Goal:

• There are a few different ways for Google to benefit from such a potential market entry, such as Revenue, User Knowledge, Improving user engagement with existing services, I would like to keep this open now but discuss those when evaluating different strategic options. [Sure]

Analyze Google:

• Strength
  • Google has alot of user to its portfolio of apps and services.
  • Google Map is dominant in the navigation market, which is vital to ride sharing
  • Google is leading in the self-driving car technology
  • Google already have some integration with ride-sharing providers such as Lyft and Uber
• Weakness
  • Google is primarily a sw company, not good at manufacturing
  • Google is not good at large scale operation
• Opportunity
  • Self-driving car will is quickly maturing.
• Threat
  • ​​​​​​​Companies like Tesla, catching up quickly on self-driving technology and good at manufacturing, and potentially large scale operation

Possible Strategy:

1. Open a ride-sharing company to compete with Uber and Lyft, before Self-driving technology is ready
2. Provide Software Stack to power self-driving cars, which can be used for ride-sharing.
3. Build Self-Driving cars, which can be used by ride-sharing company.
4. Expand Google Map to cover the request and payment of ride-sharing, while using ride-sharing companies as providers.
5. Open a ride-sharing company by operating a fleet of self-driving cars
6. Taking advange of the software stack, integrate Google's app and service with it.

Evaluate:

We can evaluate the different options from a few dimensions, such as Benefit for Google, Company Fit, Cost, Time To Market.

	Benefits	Company Fit	Cost	TTM	Recommendation
1	User knowledge;Revenue High	Large scale Operation, staff mgmt, conflict with existing partnership with Lyft. Market already saturated. Low	To establish operation, brand, develop uers, marketing High	Need to start from scratch Slow	No
2	Continuous Revenue; High	Track record of being successful providing software solutions, such as Android. Taking advantage of tech leadership. High	Limited additional investment as we've been investing here for years. Low	Fast	Yes
3	Huge market High	Competition from car companies; Google not good at car manufacturing, sales, support, distribution Low	Need to establish large scale manufacturing, sales, distribution, support High	Slow	No
4	User knowledge Traffic/user for google map Revenue share High	Utilizing our strength with User, and services; Avoided large scale fleet operation; High	Utilizing existing services Low	Need to identify new partners, Lyft/Uber might not be motivated. Med	Yes
5	User, Data, Revenue High	Need large scale fleet operation Low	High	Slow	No
6	User to Google services such as Youtube, Search, News Ads Revenue	Utilizing Google's strength in Apps and Services High	Low	Fast	Yes

Summarize:

The overall recommendation is yes, Google should enter into the ride sharing market and there are a few via options.

#2 is to capitalize Google/Waymo's leadership in teh self-driving technology and years of investment, natural move for Google.

#4 is a hard manuver given the competition with existing players. But in itself it's a perfect way to utilize Google's strength while avoiding our weakness. It's worth serious consideration.

#6 is another easy option, which can be implemented together with #2.

CLARIFYING QUESTIONS

1) What is the definition of ride sharing? Are we talking of apps similar to Scoop? OR providing underlying technology as a service based on Google maps to companies that can build the ride sharing company? OR being futurtistic and talking about Google/Waymo cars that provide driverless ride sharing experience?

2) What is the goal of getting into the ride-sharing market? Acquisition, monetization or any other?

Why don't you decide: Okay, I am going to say ride sharing as it is today and for the future and goal is not monetization but get access to consumer data, which could in-turn feed accurate information to Google maps traffic patterns and other consumer information that Google can leverage.

Why do you keep saying consumers? What is the big benefit there? Well, unlike Facebook and other companies, Google does not really have a persona of a user. This may be an opportunity to build one?

3) Is this limited to geography and do I have limitations?

US only and no constraints.

FEW MINUTES TO THINK OVER:

This is a classic market entry analysis problem and the companies SWOT has to be taken into consideration with risks (pro's and con's)

OKAY, MY RESPONSE.

As I think over this question couple of things come to my mind. I would like to provide a structure and then go from there.

First would be understanding Google's SWOT

Then thinking through a market entry analysis that includes market characteritisic analysis, competitive landscape and company fit.

CONSUMER JOURNEY

Before I get started, it's important to understand the experience at a high level.

Decide to Ride share > Search and plan for one (in advance or real time) > Get matching ride > Alleviate any safety concerns > Pick up or get picked up. Monitor the driver progress > If no show, plan alternatives > Successful drop off > Automated payments > Rinse and repeat the next time.

GOOGLE SWOT

Key questions here are what can be leveraged, what needs to be build and what are the risks.

Strengths:

A) Google maps as a platform for ride sharing (optimizations, etc.)

B) Technology capabilities to build incremental features such as real-time tracking similar to Uber and Lyft, payments integration via Google Pay, etc.

Weaknesses:

Building a system to manage trust and safety. Google does not have consumer profiles or vetting mechanism today

Opportunities:

Understanding consumer behavior when it comes to places where they head, their routine, etc. This could serve as an input to build up self driving capabilities.

As I mentioned, valuable information about a consumer, inputs to traffic patterns, an eco-system experience with use of other products such as Google Pay, etc.

Threats:

Will this scale?

Any negative ride sharing experience would impact Google's brand

Overall, is the risk worth it or it's better for Google to provide all the underlying services and let someone else take the risk and build core competency around trust and safety and risk management?

NOW NEW MARKETING ENTRY ANALYSIS

Back of the envelope calculation shows that we are talking about the following in the US.

150M drivers

80% drive to work: 120M

Average trip to work 25 miles

Optimistic market penetration: 10% given it's difficult to coordinate schedules and many people prefer driving alone and also traffic is not a concern in all places.

TAM: 120M

SAM: 10M

From my perspective, its a small market, lacks growth and profiot margins in terms of monetary value and data acquisition is not that signficant.

Competition already exists and market is pretty fragmented. Google can easily use its brand to position a product but it would require changing consumer preference.

Finally from a company fit standpoint, it is not Google's core DNA to build trust and safety systems that deal with human behavior. It is not a business model that has economies of scale, and it's as self managed supply - demand marketplace that Google cannot influence. For e.g. if someone living remote cannot find a ride share then Google cannot send its own car or create a driver. Such experiences will lead to abandoning the product.

CONCLUSION:

As I think of about it from the market entry analysis standpoint and company SWOT, I don't recommend entering the ride sharing business. Alternative ways exist to get acccess to consumer data such as parternships, etc.