"OLA" - case study

OLA was founded by two IIT graduates Bhavish Aggarwal & Ankit Bhati. In India, Ola is operating in 125 cities offering online services through cabs, auto-rickshaws , and two-wheelers.In 2019, it started its services in Australia, NewZealand, and the United States.

OLA business model is some sort of just acting as an intermediate and making money without initial investment as in they proposed all the taxi drivers that come with your taxi we will provide you the customers and you have to pay some commission to us. Starting with this new idea even the taxi drivers agreed because they were able to earn more as they earlier used to.

Even many people bought cars on EMI and hire a driver and just pay him the monthly salary and all the extra profits which he was getting was in their pocket. OLA was also providing 6 rupees per Km and first ride free to attract customers at the start but all these led to 2300 crore of loss in the financial year 2015-2016.
as they paid 387 Crore as salary to their drivers as well as in advertising they invested 437 crores & in Technology, they spend 120 crores. Also, at that time their incentives were high and valuation was low.

Seeing all these they improved all this by various strategies one of them was buying Taxiforsure as all there customers were directed towards OLA and at that time they got free advertising from media which helped them a lot in expanding their customer base as well as their services. And in the next financial year, their incentives were low and valuation increased.

Ola earns money through various means:

• Trip Commission
• In-Cab Advertisement
• They in collaboration with SBI launched OLA SBI credit card( & they earn a commission whenever there is a transaction through the card.
• OLA money( wallet of own)
•  B2B tie-ups
  

 Ola has the most significant market share in the country as of now. Also, the company's revenue has increased 10X times in the last four years. Hence, Ola has become the leading on-demand cab booking service provider in India.


As of May 2019, Ola's valuation is $6.2 billion