Redbus.in

Automating The Bus Travel Industry

The Team• Bernard Fernandes

(A011)• Joylyn Fernandes

(A012)• Shirin Khetani

(A063)• Biju Thomas

(A051)

Case Synopsis

Challenge• Many attempts to automate

bus reservation were met with failure

• Volatile demand & huge resources needed to be managed

• People reserve bus tickets on the spot

• Bus reservation more complex than airlines due to number of stops

• Target Customer group is different from airline TG (may not be computer literate/ no credit card/lower income group)

Accepting the challenge would

mean….

• Automation would help in reservations & bus driver allocations

• Higher efficiency would reduce operation costs

• Reduce the number of near empty buses.

• Customer data would help decide when/where to reduce prices

Challenge Accepted!

• RedBus founders mimic the bus operators operations in the backend. Create a website functioning like a travel agent

• Information like Departure points in a city/Route info/Ticket rates

• Phone booking or through partner outlets / retail outlets/cyber café tie ups

• Cash On delivery/Mobile Platform

• Plans on to implement CRM & ERP solutions

• BPOs deployed in every office location

• Host data on cloud.

Information Management Systems observed in this case study

• Moving to the Cloud has helped create a competitive advantage.

• VPN Network with data stored on a central server hosted by GoDaddy

• Plans to implement ERP & CRM solutions

Rivalry Among existing Firms [MEDIUM]

•Existing firms who could go big in the bus reservation service

•People tend to depend on agents for a personalized service

Determinants of Buyer Power

• Customers looking for bargains

• Low Product Differentiation

Threat of New Entrants [LOW]

• Easy entry for new players as its an internet based industry•Has the first entrant advantage

Determinants of Supplier Power[MEDIIUM]

• Operators depend on RedBus.in to bring in

customers

Threat of Substitutes[HIGH]• Offline reservation/ Travel

agents• On the spot reservation

Question 1.(i)Use the Competitive Force Models to Analyze the Bus Industry Online Reservation Situation.

Question 1. (ii)What Competitive forces did the bus operators have to

deal with?• Competitors include existing travel reservations sites like

• Travel Agents

Question 1. (iii)What kinds of Strategic Information Systems this

industry needs?• CRM software : To manage customer data– Offer coupons to nudge repeat purchases of tickets– Manage customer preferences like timings, routes,

operators, price preferences

Question 2How much strategic advantage would Redbus solution have

provided to the bus operators?

Efficiency •Automation will save time•Thus save costs as well

Increased sales •Redbus.in will ensure better sales•Lesser chances of buses leaving near empty

CRM •Better understanding of customer preferences•Popular routes/prices

Organization of the sector

•Availability of better data for industry insights•Could use this to improve the operations

Question 3What Management, Organization & Technology factors contributed to

the success of the Redbus business model?

Management •Founders were from a IT background •Researched the industry

Organization•Grown strategically by opening up offices in 6 metros•It has also partnered up with 300 bus operators & has operations in 15 states across 400 locations•Today it has a huge distribution network of over 35000 outlets •BPOs established for better customer experience

Technology

• RedBus offered customers the ease of booking bus tickets online & had the early entrant advantage in this case.

• Offering COD to customers who are not comfortable paying online. Customer has to call the company’s call center.

• Interface with other online portals. • Services on mobile platforms like Ngpay & mCheck.• Offices connected via VPN networks at a centrally hosted server • Moving to the Cloud improved efficiency.

Thank you