The article was updated on June 21, 2023.
During the last several years, there were enough momenta for traditional services of all sorts moving to a new plane. As a result, we’re witnessing a tremendous rise in the on-demand industry, as it’s projected to skyrocket with a CAGR of over 60% by 2027.
These statistics show that a huge part of global customers prioritizes a convenient way to receive nearly any service instantly by choosing from a wealth of choices in a single on-demand service platform. For vendors, it’s a lucrative perspective of getting a much wider reach and cutting costs on business-related needs. That is, an on-demand application connects service providers with people who need them, presenting benefits to all parties.
Considering how to create an on-demand app? We’ve prepared a quick guide on the possibilities of this kind of software, its main features, and the challenges you may face, along with our experience in building platforms for the on-demand economy.
What makes on-demand apps so popular?
According to BusinessInsider, “The On-Demand Economy is defined as the economic activity created by technology companies that fulfill consumer demand via the immediate provisioning of goods and services.”
Put simply, on-demand applications represent platforms where service providers and their potential customers can find each other.
On the customers’ side, people can choose from various options to find the perfect provider for the service they seek. Service providers, in turn, can promote themselves by presenting their skills and experience. They also receive a rating based on reviews after providing services for clients.
In this simple on-demand model, what are the advantages for users?
- Convenience – In apps on demand, the process of selling and buying services is designed with users’ comfort in mind, so they can do it effortlessly while enjoying a user-friendly and visually pleasant interface.
- Attractiveness for target customers – An efficient on-demand business model allows service providers to offer lower prices for their services compared to traditional businesses, which makes the demand evergreen.
- Protection of user interests – From payments to refunds, apps like Uber imply caring for user data protection and satisfaction guarantees.
At the same time, how can on-demand services app owners benefit from offering such a platform?
- User satisfaction – By giving your users exactly what they expect from the modern service trade, you can easily turn them into loyal regular customers and expand the customer base at the same time.
- Scalability and revenue – Uber-like apps have a great potential for growth, as you can add more partners and businesses, and also for giving you as an app owner huge revenue due to the combination of a large user base and effective monetization methods.
- Customer behavior analysis – A modern on-demand service app includes a number of means and tools for tracking and estimating customer behavior, which helps you improve your service continuously.
Probably, the most outstanding and obvious example of such a product is Uber. This on-demand transportation service was among the pioneers of the sharing economy. The project became so popular that it eventually started a wave of “Uber for X” startups across various industries, especially food delivery.
However, besides transportation and food delivery, such niches as retail, healthcare, and home services are some examples of industries that can take full advantage of the on-demand service application development.
Types of on-demand apps
On-demand mobile app development is an extremely diverse market, where you can find apps for different business models and niches.
Based on the type of business, there are three main categories of on-demand service apps:
- Business-to-Business (B2B): This kind of app on demand connects businesses that can provide services to one another; a freight service – Cargomatic, and a platform for finding consultants – Catalant, being the most illustrative examples.
- Business-to-Consumer (B2C): With this business model, companies play the role of service providers for their clients. In this category, Uber is an iconic on-demand ridesharing platform.
- Consumer-to-Consumer (C2C): C2C on-demand apps allow individual users to be both clients and service providers. Airbnb is the most popular example of this type of app, as people can provide their housing for vacation without corporate mediation.
Among the most popular on-demand services types by niche are
- food delivery: UberEats, Grubhub;
- grocery delivery: Instacart;
- taxi: Uber, Lyft;
- video streaming: Netflix, Disney+;
- e-learning: Skillshare, Lingoda;
- healthcare: Spruce, Doctor on Demand; and
- flower delivery: UrbanStems, Floward.
How to start a business like Uber? Challenges to consider.
Judging by our extensive experience in Uber-like app development, businesses need to consider the following aspects when adopting the on-demand business model.
1. App development
Apps like Uber typically require native app development with an increased focus on performance. Moreover, to set up an efficient on-demand business, you need to build several applications:
- a mobile app for the service provider;
- a mobile app for consumer; and
- a web-based business backoffice (admin panel) for managers and administrators.
The listed applications will require the use of different technologies (2 tech stacks for mobile development, frontend development, and server-side technologies). That is why the Uber tech stack is quite versatile.
As a result, it takes time and multiple development teams to build a single Uber-like platform. This will also impact the cost of the Uber-like app development. To keep the costs reasonable while maintaining the high quality of the final product, we recommend building your cooperation with the development team based on Time and Material or the “managed projects” approach.
2. Business model
When building an app like Uber for your business, you need to pay great attention to planning and developing the app’s business logic. Uber-like apps need to be highly scalable and should efficiently allocate resources in order to be financially viable.
3. Uber-like apps specifics
On-demand apps typically require integration with GPS services (take for example Uber’s map API). That is why it is important to choose a technology provider with specific skills and expertise in this sphere.
4. MVP and step-by-step growth
Start your development with an MVP (minimum features, single target platform) and iterate toward the full-featured version of the product step by step. As your on-demand business grows, you will need to monitor the user feedback and be able to pivot in response to the changing market requirements.
Features like scheduled rides, dynamic pricing, in-app chat and tipping, gamification elements and promotions are not crucial for your business model at its early stages and can be added later. As mentioned previously, Uber has added the tipping feature and in-app chat just recently.
5. The B2B aspect of Uber-like apps is often overlooked
Its implementation without a clear understanding of the underlying logic and business needs, or its complete absence might lead to the situation where even a well-implemented product fails shortly after its launch.
Let’s consider an example of a B2B module in an Uber-like app.
When you launch a corporate/business plan in your app, take into account that a corporate web application should integrate with both the end client and the service provider apps, collecting the required data to provide detailed usage reports. Moreover, the employee profiles might be connected to a single corporate account for simplified billing and payments.
Depending on the permissions and access rights, there are three types of user roles in B2B interface for Uber-like apps.
- Order management role – This role allows a user (typically a secretary or an office manager) to place orders on behalf of other company employees, see who, when and where uses a service. This role doesn’t usually require access to financial data or permission from management.
- Financial management role – This role provides the access to complete financial data, reports on the services taken by the company employees.
- Operations management role (Admin) – This role has admin access to the system, therefore allows for complete permissions management. Admin account can change the rules for order management and has complete access to financial data. It also allows you to manage the related corporate policies (who can use the services, the credits available to each employee and time restrictions).
6. User experience
UI/UX proves to be a crucial element for Uber-like apps. Regardless of the complex business logic, the apps should be intuitive and easy to use, with minimum steps required to place an order.
A smooth onboarding and straightforward user flow are required to reduce churn, as the app will be used by users of different ages and backgrounds.
7. Must-have features of an on-demand app
Before starting with on-demand app development, you should consider what kind of features you want to have in your application. No matter what type of Uber-like platform you choose, there are 7 main features that make up a basic functioning on-demand app:
- Registration – This step is essential for all users, yet may be tedious for some. To avoid customer irritation right from the onboarding process, make sure they can complete this with one-touch by adding social media accounts integration.
- Service provider’s profile – If you want to involve different vendors, they’ll need the option to describe their experiences and the services they offer.
- Filtering options – Providing users with different filters will speed up their search process while ensuring matches are as accurate as possible.
- Payment methods – Several payment options will give a larger choice to your clients and satisfy the payment preferences of a wider audience.
- Order tracking – A distinctive feature of Uber-like apps compared to traditional services is users’ ability to take full control of their order and see where it is at any given moment, as well as an estimated arrival time.
- Notifications – Consequential to order tracking, this feature allows users to get updates on their order through push notifications. Also, it can be used for promotion purposes.
- Rating – Having the option to send reviews and estimate the quality of services provided by the vendor will increase the level of trustworthiness of your app.
Our experience in building apps like Uber
With vast experience in building some of the top-tier Uber-like apps, we at Eastern Peak have accumulated the expertise and valuable business insights about the on-demand economy. Take a look at some of them below.
1. Taxi app like Uber – Gett
The app: Gett (previously GetTaxi)
Industry: Transportation
Description: Gett is a global taxi service driving half the Fortune 500. The company ranks #1 globally among on-demand corporate transportation service providers and currently operates across 100+ cities in the UK, the USA, and Israel.
Features: This Uber-like platform has a similar business model and features. Users can request a ride using an app and track the location of the car on the map. The app features a driver’s rating and allows you to pay directly via the app. Similar to Uber, the app offers delivery services (not just food, but also a courier service).
- GPS capabilities (pickup location, car location, routing);
- cashless payments and tipping;
- a rating system (for both the driver and the passenger);
- a fixed/flexible fare calculator;
- instant taxi booking or pre-booking;
- delivery services; and
- the ability to split fares between passengers with Gett XL (similar to Uber Pool).
Unique benefits: Gett is one of the main competitors of Uber in Europe. The company offers a number of competitive advantages over other apps like Uber.
- The app lets you choose between a fixed price or the meter fare.
- There is no surge pricing depending on time or location.
- Gett works with licensed taxis drivers, unlike Uber which uses independent private drivers.
- One more feature, that used to be only in Gett previously: option to tip a driver has always been present in the app unlike with Uber. Uber also added this feature with time.
While there are many taxi apps like Uber, the on-demand economy has seen a significant adoption apart from the transportation industry. Below are some more our examples of how apps similar to Uber can be applied to other business domains.
2. Uber-like platform for repair services – Fixit Joe
The app: Fixit Joe
Industry: On-demand repair services
Description: Fixit Joe is an Israeli startup that provides on-demand repair services to households and businesses. This Uber-like app connects its users with professional providers by instantly using an advanced rating system and GPS capabilities. The mobile application, as well as the backend system, was developed by our development team from scratch.
Features:
- a discrete rating algorithm for professionals;
- convenient service scheduling (instant request or in-advance booking);
- GPS capabilities (to track the repairman’s location); and
- convenient payment options integrated into the app.
Unique benefits:
- Transparent pricing model – the service provides instant cost estimates for the requested service.
- A fast service guarantee (the repairman is required to arrive in less than 60 minutes after the request is accepted).
- The company works only with hand-picked and trained professionals.
3. On-demand car washing services – Bonshine
The app: Bonshine
Industry: On-demand automotive services
Description: The company offers on-demand waterless car cleaning services. The app connects its users with cleaning professionals, and allows them to schedule a cleaning, anytime, anywhere.
Features: This Uber-like app features standard capabilities, including
- a request form (GPS-enabled);
- in-app payments; and
- the ability to rate the service providers.
Unique benefits:
- Service reports – Users get before and after photos sent to their apps to verify the quality of the provided service.
- A web-based dashboard for the business, including analytics and reporting.
- The service is provided by the company’s qualified cleaning professionals.
4. Crowd testing platform – Ubertesters
The product: Ubertesters
Industry: Crowd testing
Description: The platform is a cloud-based, process management solution for mobile app testing.
Features:
- access to professional, certified testers on demand in 80+ countries;
- real-time statistics and monitoring of testers’ activity;
- a discrete rating algorithm for professionals; and
- convenient payment options based on the time spent by testers.
Conclusion
Year after year, people have been searching for simple yet effective solutions to meet their needs in terms of both everyday routine requests and demands on special occasions.
The on-demand economy was developed to provide customers with a flawless experience while giving service providers an opportunity to showcase their competencies. By investing in building apps like Uber, you take a further step to creating a convenient reality for today’s and future consumers.
How to get started?
The product discovery phase is the best first step you can take to lay a solid foundation for the development of your app. It includes a functional specification, UX/UI design, and a visual prototype that will give you a clear vision of the end product. On average, this phase takes 4-6 weeks.
The product discovery phase can help you:
- define a full scope of work and develop a roadmap for the project
- set a realistic budget for your MVP and plan your resources
- test the waters with your audience using a visual prototype
- craft a convincing investment pitch
- get to know your team
If you are considering building an Uber competitor or introducing an on-demand business model in your business domain, contact us now.
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About the author:
Alexey Shalimov, CEO at Eastern Peak
As CEO at Eastern Peak, a professional software consulting and development company, Alexey ensures top quality and cost-effective services to clients from all over the world. Alexey is also a founder and technology evangelist at several technology companies. Previously, as a CEO of the Gett (GetTaxi) technology company, Alexey was in charge of developing the revolutionary Gett service from ground up and deploying the operation across the globe from New York to London and Tel Aviv.
