BlaBlaCar

The power of word of mouth

The idea for BlaBlaCar came to Fred Mazzella, Founder and Executive Chairman, out of a frustrated attempt to buy a train ticket. When he found that every seat had been sold, he was forced to call his sister, who had to come to Paris and pick him up. “On the road, I could see the train, which was full. And I could see the cars, which were empty. And then I got the idea.”

From that moment of inspiration, BlaBlaCar’s carpooling platform has grown into a major force in the sharing economy. Operating in 22 countries (mostly in Europe, with Brazil, Mexico, and India being the major exceptions), BlaBlaCar boasts over 70million members who use the service to find or fill empty seats in cars heading to mutually agreeable destinations. Drivers set the price for the empty seats and passengers book in the same way they would buy a ticket on a train or airplane. For drivers, the appeal is in offsetting costs, while passengers get an economically-priced, direct (often door-to-door) trip without the crowds.

Slow growth, then fast

BlaBlaCar is firmly part of the sharing economy in that it takes unused assets (i.e. empty seats in cars) and gives them value. Growth has paralleled that of other sharing economy services as people get more used to interacting with other individuals, rather than corporations, for transportation and hospitality.

Convincing people that carpooling was a viable transit option took time, and initial growth was slow. Also, Mazzella had no money for marketing, so as he was honing the offering he had to rely on word of mouth for growth. Then, some serendipitous PR opportunities came in the form of train strikes in France. Capitalizing on the opportunity, BlaBlaCar was able to promote itself as an alternative.

Still, it took seven years for the company to win over its first million users. That milestone arrived in 2011, by which time the sharing economy was better understood and accepted. Coupled with some infusions of capital and well-funded marketing campaigns, growth took off. Today, with its 70 million members, the company is adding 1.5 million new users per month. “In three weeks, we are adding what it took us seven years to build,” says Mazzella.

Users = Success

Beyond revenue, success for BlaBlaCar relates directly to the number of individuals it is able to bring into the community, and the number of passengers finding drivers’ empty seats and drivers finding passengers. Currently, BlaBlaCar facilitates over 25 milliontrips per quarter. To put that in perspective, the EuroStar train takes 2.5 million people between Paris and London each quarter.¹British Airways carries about 11 million passengers over the same period.² And, as Mazzella points out, BlaBlaCar does it without having to buy trains, jet airplanes, or dig a tunnel under the English Channel.

The ecosystem

BlaBlaCar is, at its essence, a marketplace where the key players in its ecosystem are drivers and passengers. However, the company has been developing partnerships with complementors to help generate traffic. Gas retailer Total offers a voucher for BlaBlaCar carpoolers as an incentive to reduce carbon emissions. The company has also partnered with AXA to offer users insurance that they can buy on the BlaBlaCar platform. A unique element of the coverage is that, in case of a roadside breakdown, both drivers and passengers can get rides to their intended destination

The company has recently made an offer on OuiBus, a state-owned French bus company serving 300 destinations in Europe. The idea is to integrate the two services so that the current BlaBlaCar community is presented with more travel options in the future.

With so much of intercity transit state-owned, this partnership may be one of many public-private agreements BlaBlaCar establishes in countries where it operates. Going forward, train service is the natural target for further evolution.

The trust factor

One of the biggest barriers to getting users to adopt carpooling is that of trust. BlaBlaCar has developed tools and product features for its platform that are specifically designed to help build trust. Drivers and passengers are rated and comments are moderated. Links to member pages on social media platforms such as Facebook or LinkedIn allow the prospective driver or passenger to know more aboutthe person they are about to spend hours with.

Because of these tools, the level of trust among BlaBlaCar users is actually very high. In a survey conducted by BlaBlaCar and NYU Stern over 18.000 respondants in 11 countries, 88 percent said that they trusted BlaBlaCar users with a profile almost as much as they trusted family (94 percent) and friends (92 percent), and a lot more than they trusted colleagues (58 percent) or neighbours (42 percent).³

Another factor in the high level of trust is the spillover impact from the rest of the sharing economy. People who use services like Airbnb are more likely to be willing to jump into a car with a stranger.

With growth, the company has sought to maintain the ability to win and hold the trust of its users. This means that when BlaBlaCar acquires similar companies in other countries, it relies on recruiting locals who drive activity on the site and establish profiles that lay a strong foundation for future, trust-based growth.

Mazzella says that this model can be extended to OuiBus and any other offerings the company brings to the platform. “It provides transparency in the marketplace and allows people to take part in the very trust-building the service depends on. Passengers can rate drivers and drivers can rate passengers. It’s a way of bringing our DNA into a different world.”

Trust does not eliminate the fact that things can go wrong when a ride share is matched through the BlaBlaCar platform. The company views itself as a marketplace that brings buyers and sellers together rather than as a vendor. Still, the BlaBlaCar brand is vulnerable when negative incidents occur. Realizing this, the company has placed emphasis on transparency. “We’ve tried to build a reputation on being very fair and transparent and professional,” says Mazzella.