Uber is testing adding train and coach travel to its app in the U.K. so customers can book longer distance ground travel via a fully integrated tie-up with Berlin-based multimodal travel platform, Omio.
The latter has built up its own consumer facing apps for booking intercity and international travel, across a wide variety of supported transport options, over almost a decade of operations. But, in recent years, it’s been ploughing resource into building out a B2B line — making its inventory available to partners via APIs so they can add transport booking options to their own apps and platforms.
Uber isn’t the first such tie up for Omio, per founder and CEO Naren Shaam. But he tells TechCrunch it’s the first partner to get full access to its ground transport inventory — which covers more than 1,000 transportation providers across 37 countries at this point.
“Uber is the first partner that is both at this scale but also the first that gets access to our full ticketing API so you actually are, as a customer, able to do everything within the Uber app — so it is the first with respect to this product that we’re offering,” he says.
Omio’s earlier B2B partnerships include some transport providers themselves, such as U.K.-based LNER, as well as the travel search engine Kayak and smartphone maker Huawei, among others.
The ride-hailing giant is also the biggest B2B partner Omio has signed up so far: Shaam says the tie-up will put its inventory in front of the circa 5 million+ customers Uber claims in the U.K .market.
And while Omio’s own app includes non-ground transport options (like ferries and even flights) he says its platform remains strongest in inventory terms for booking train and coach/bus travel — hence why it’s starting there with Uber. Although Shaam hints there could be more to come. “This is the beginning of our partnership; it will expand — beyond just geography,” he suggests, noting that Omio’s B2B partners can “pick and choose” from its full inventory range of supported transport models to offer their own customers.
“It is very clear to me that we’re never going to have 100% of all the eyeballs in the wall using only Omio so very much the company is evolving into a more data company — where the data and our inventory becomes a core asset,” he adds, discussing its ramping up of focus on B2B alongside what he couches as a nicely scaling b2c business of its own.
“We spent years building very unique inventory… so actually during the pandemic… we realized that what we built — the core of the asset — is unique inventory that is very hard to access anywhere so we started building a team for b2b.”
From the get-go, the ground transport tie-up via Omio’s API will enable U.K. Uber users to book international trains if they’re so inclined.
Albeit actually getting out of the country and into France may prove more challenging — given recent post-Brexit travel chaos hitting holidaymakers at borders and in airports (related to post-pandemic staffing issues), not to mention ongoing pay-related train strikes over the summer… (Shaam confirms Omio has seen some of that disruption in its U.K. data, with users switching to shorter distance travel, for example, but he says he expects such changes to be temporary.)
Commenting on the tie-up in a statement, Andrew Brem, general manager of Uber U.K., said: “We’re excited to launch our new travel offering this summer, allowing a seamless door-to-door travel experience across the U.K. Partnering with Omio will accelerate our efforts to become the go-to travel app for our UK users”.
Trips booked via Uber’s app using Omio’s API generate a commission for Omio — a portion of which it passes back to Uber for bringing it the custom. (The commission split isn’t being disclosed.) It’s also generating revenue from Uber by licensing its tech.
For its part, Uber has been long been expanding its core ride hailing platform by integrating additional functionality — targeting becoming an urban convenience hub (aka a ‘super app’) where you can book everything from dinner and a movie as well as order a ride to get there.
So adding longer distance ground transport adds another string to that play and could help it tack on last mile ride hailing journeys at either end of a train trip, say. Or (re)capture some revenue from users who may be switching from ride hailing to cheaper rail or coach options if they can be persuaded to make those bookings in its app.
Challenges for Uber to turn a profit also remain. Reporting Q2 earnings yesterday it still couldn’t claim that — but it did generate another quarter of free cash flow and was rewarded by investors bumping its share price on another positive signal that suggests it can at least self fund so won’t literally burn itself out of cash.
Returning to the Omio tie-up, Shaam says ground transport booking functionality provided by its API will be added to Uber’s app in phases with a basic set of features at launch today — which he expects Uber to build out over the coming months.
“It’s a new product for Uber and while we have a lot of knowledge over time building long distance ground transport Uber focuses mainly on inner city public transport and the use cases are very different. Long distance you have multiple fare class, cancelation, a reservation system, seat reservation etc — very different product than just a ride hailing product — so it is going to be in phases where they add multiple products.
“So the first one will be in your ‘transit tab’ — where you can search from, say, London to Manchester or Oxford or even Heathrow Express, or London to Paris on Eurostar, and you can fully transact on the Uber transit product long distance train or bus.”
“The full extent of the basic aspects of the product should be there in the first instance, I think — I do believe the add ons come as they bring the Uber magic to life,” he adds.
But will Uber users — who typically use the app for booking a quick cab trip or a hot meal — really think to use its platform for a less spur-of-the-moment purchase like a train or bus trip to another city or region?
Responding to that, Shaam points to “high overlap”, in terms of customers, despite the two products being built for very different use cases — while also playing up some “complementary” segmentation between these respective customer bases (noting for example that Uber has a higher share of business travellers among its users). So the suggestion is there’s enough similarity and difference between their platforms for the tie-up to drive new business for both of them.
Shaam won’t be drawn into sharing any internal estimates for how many Uber customers it expects to pick up but he does say they’re hoping the tie-up will help Omio substantially increase its penetration of the U.K. market — which he confirms is not one of its bigger markets currently.
Asked if Uber will be rolling the transport booking feature out to other markets — such as the U.S. — he also sounds hopeful, while affirming that today’s launch is a bit of a test to see how users take to it. So how far this long(er) distance travel booking feature flies within Uber’s digital real estate remains to be seen.
“The partnership, hopefully, is not limited to the UK but it is a new product for Uber and they need to launch in one market, test and then hopefully depending on the success of that — for both sides — we intend very much to scale it,” he adds.
Omio has generally emerged from the COVID-19 travel freeze and pandemic disruption in upbeat mood — announcing an $80M Series E top up to its funding in June and reporting rebounding demand which Shaam reiterates again now. He remains on bullish form, talking up the scale of the mobile booking opportunity yet to be captured when it comes to the kind of intercity/longer haul travel demand Omio has made it its mission to service.
“One of the bets we made during the pandemic is a massive shift from kiosk [based-booking] to mobile because of what happened with COVID-19,” he says. “For me it’s a surprise that 50%+ of the entire rail industry still sells its tickets at a kiosk. If you actually look at it, both hotels and airlines are higher basket — higher average basket — slightly even more complex experience and no one I speak to can remember ever booking a flight outside of the Internet or in the offline world so it’s very much still an industry that is significantly offline and that whole thing will come to mobile — because of the simplicity of the way train products work (per geography).
“Most of it I think will become mobile and our own data shows that 80% of all our tickets are sold on the phone. Incredible when you compare it to other travel segments. So for me it’s a natural trend that’s happening which has been accelerated by COVID-19 — so this is something we can bet on quite comfortably; a switch to mobile will be accelerated with more products and more service links.”
Mobile app- versus kiosk-based booking can woo travellers by helping them beat (at least some of) the queues, he suggests, or avoid unfriendly user interfaces on outdated ticket office machines that might not even support the user’s local language and aren’t often upgraded.
You could say Omio’s vision for its travel business, post-pandemic, is ‘onward, upward and outward’ — with a strategy to spread its utility far and wide by integrating into all sorts of other apps (or super apps) that travellers might want to use to get where they need to go. And Shaam confirms it has further B2B partnerships in the works.
“The goal of our b2b business is very much like a SaaS,” he adds. “You plug in once and then it — hopefully — adds annual recurring revenue and we just add more partners in different verticals… to parallel industries and give them a piece of our revenue so the economics is also attractive for anyone that wants to sell transport but wouldn’t necessarily want to, or have the capital to… put in the effort to rebuild 1,000 integrations in 37 countries because it’s a single API, less than one second latency. You plug into Omio and then you’re plugged into our entire ecosystem.”