Long Beach cabs take a page from Uber's playbook
California city first in U.S. to deregulate taxi industry to compete with ride-sharing apps
When you've been driving a cab for almost three decades, you figure out ways to get an edge on the competition. For Yellow Cab driver Bill Lanham in Long Beach, Calif., it's building a personal brand: a leather vest, a Duck Hunter goatee, tattoos up and down his arms, and a nickname. Wild Bill.
"Well actually that's just marketing," Lanham says as he steers his cab through the downtown of one of Southern California's largest cities. "I'm a night driver. And if you want to go out drinking, you don't want Mild Bill you want Wild Bill to drive you around."
These days, though, his brand isn't drawing customers the way it used to. Now, business is down more than 30 per cent, he says. All because of competition from one company.
"And I'm not going to name names … but it's a German word. They've put so many cars on the street that they've literally flooded the market."
Of course Lanham's talking about Uber, the app that connects riders directly to private drivers. But because the drivers aren't technically employees, Uber isn't considered a taxi company. And that, according to Long Beach Yellow Cab manager William Rouse, is unfair.
"They have a business model that relies on the fact that they are almost entirely unregulated compared to the taxi industry," Rouse says.
So the taxi industry has tried to hit back. Drivers have led fiery protests in countries like France and Italy, and some places have banned Uber altogether.
But ride-sharing is becoming increasingly popular, which is why taxi companies in Long Beach took an unusual step: they asked the city to ease restrictions to make them more competitive. More like Uber.
"We were the first ones to go to City Hall and go 'Hey listen we need to make some changes to compete with these guys,'" Lanham says.
And in May, Long Beach mayor Robert Garcia agreed.
"There's exciting things happening in the sharing economy," Garcia says. "I think a lot of people here in Long Beach use Uber and Lyft. I've used them before.
"I think a lot of people like the service, but we also want to make sure that our taxis have the support and are equipped to survive as well."
One of a kind
Now, in a trial program that the city believes is the first and only one of its kind, Long Beach taxis can offer incentives and flexible fares. They can also increase or decrease their fleet size to respond to demand.
"And so it allows us to assist our taxis with not putting any regulations on Uber or Lyft," Garcia says. "Taxis are going to become better or they're not going to exist."
That's why Long Beach Yellow Cab has gone a step further. A month ago, it rebranded itself with a new name, colour, logo, and a new, very Uberish app.
Long Beach Yellow Cab's director of strategy Shan Gupta pulls out his smartphone.
"So what we've designed is an app that's called Ride Yellow," Gupta says. "It's going to locate us on the app and it's going to give us an ETA of when a cab is going to arrive.
"I tap 'request ride' and instantly I'm going to have a cab that's going to be coming to me in minutes. Once you put a credit card on file you have that option as well... So we make it seamless. You can walk in and walk out of the cab without having any cash or making any other transaction."
Just like Uber.
Has it worked? Bill Lanham says ... kind of.
"Yeah, we're seeing a little bit of business from that," says Wild Bill. But he knows that building a brand takes time. "It's only been a month."
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