BlaBlaCar: The Ignition Story
By David S. Evans and Richard Schmalensee
Excerpt from De précieux intermédiaires
Frédéric Mazzella waited too long. He was in Paris, in December 2003, and wanted to get home to Vendée for Christmas. He went online to book a train. There was only one seat left. “ Il en restait un à 5 h 13 à Montparnasse, sur un strapontin, à 110 euros,” he recalled. “[L]e truc que personne ne veut.” His younger sister came to his rescue. Driving the family’s old Honda Civic she made a lengthy detour and picked him up.
A few hours into their 500km road trip Fred saw a packed train running beside the highway. Meanwhile hundreds of cars whizzed past him. Most were empty, he saw, except for their drivers. He had a flash of insight: there are seats going to Vendee, just not on trains. They’re in cars! If only he could have shared a ride he could have saved his sister some trouble.
After inspiration comes perspiration.
From 2004 to 2006, Fred and two friends, while holding down full-time jobs, worked to develop a web-based ride-sharing platform initially called Covoiturage. The platform allowed drivers looking for riders and riders looking for drivers to post ads for free. Fred and his friends got some people to sign up based on word of mouth, a little free media, and links from other friendly websites. But there were not enough drivers or riders along any particular pairs of cities, like Paris and Lyons, to make the site very interesting to anyone. They had no money for marketing. Meanwhile at least nine other start-ups, often copying their innovations, were fast on their heels.
The three guys got their big break on a Sunday afternoon in October 2007. By then they had a service that anyone could access with a mobile phone. Next month, it was announced, France would have the biggest train strike since 1995. Fred’s older sister who worked in communications convinced him to seize the opportunity. He paid a PR firm €200 to send a press release to 6000 journalists the next morning. The message: “Pendant la grève, le covoiturage deviant mobile.” It stressed that ride sharing would be a travel option during the strike, and it urged drivers planning trips to sign up on the platform to help travelers who would otherwise be stranded.
The media response was tremendous. Fred was on TV seven times and radio 10. And the platform was featured in around 500 newspaper articles. By the end of 2007, Covoiturage had 70,000 members.
That sounds like a lot. But there were still not enough riders and drivers ensure that drivers could find riders or that riders could find drivers between pairs of cities in France. That also made it hard to recruit new drivers and new passengers.
With no money to spend on marketing, the company continued to rely on free media coverage of strikes and other disruptions, like the Icelandic volcanic eruptions of April 2010, which grounded planes in France for several days. Company staff focused on learning from their members and providing excellent service to them.
Persistence paid off. Covoiturage is now known as BlaBlaCar. As of October 2016, it had more than 35 million members—drivers and riders who had joined the platform—in 22 countries. The name is based on a feature for matching drivers and passengers: how much they like to talk—bla, bla bla, or bla bla bla. On average BlaBlaCar has around 4 million travelers a month.
BlaBlaCar ignited and grew explosively while its rivals withered.
Mazzella attributes its success to a relentless focus on trust-building and member service. From the beginning, members stressed how important it was to be able to trust those with whom they rode, and the staff accordingly focused on developing mechanisms for building trust. Members must now provide phone numbers, which are checked by the company, photos, which are checked by those who share trips, and other information. Members are allowed to create full profiles, and it is possible for women to travel only with other women if they choose. After trips, members rate those with whom they have traveled and indicate whether their photos and profiles seem accurate. A high rating on the platform became an asset, encouraging both good behavior and loyalty.
Trust wasn’t enough though. Mazzella and his colleagues had to get the business model right for drivers, passengers, and the company, which needed to make money. It experimented a lot during its first five years. The first idea was to operate a free classified ad platform for consumers and make money selling to businesses. That wasn’t scalable because each business wanted something different. They considered asking frequent users to pay to get premium service on the platform. But this went against the spirit of community they were trying to build by putting paid members ahead of the best members this approach went. It didn’t work either. A monthly membership fee also didn’t work because some people used the service much more than others.
Finally, in 2011, 8 long years after Fred’s inspiration, the company adopted the highly scalable transaction model it uses in 2016. Passengers book online prior to the ride. BlaBlaCar takes a commission on the price paid by the passenger. The driver gets credited directly on his bank account after the journey. BlaBlaCar makes sure that drivers charge just enough to cover the cost of petrol and other expenses.
BlaBlaCar got funding in 2009 and had raised more than $300 million by October 2016. With money in the bank it had to rely less on free publicity, hoping for that next volcanic eruption to shut down air service, and help from big and little sisters. Now, when the company enters a new market, it picks a particular pair of cities as the initial focus and recruits, through communications and marketing, members to ride-share to the other city in both locations.
Drivers are harder to recruit than riders, since drivers only save money, while riders get a very cheap trip. BlaBlaCar targets prospective drivers and passengers with online and offline communications and marketing strategies, featuring the advantages of this affordable and friendly way to travel. After one city-pair route has attracted enough drivers and riders to make the website attractive to others interested in that route, the company targets other routes and then advertises broadly.