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Strategies to Redeem Didi’s Business Image

Introduction

Nowadays, after contending with Uber for 3 years, Didi has become the biggest ride-sharing in China and provide convenience for more than 3 million people and seven billion person-time per year. Thanks for Didi, we now have more way to choose when we travel. Didi leading the tide of Chinese sharing-economic and contributed the sustainable development and green travel concept. However, after two female hitch passengers killed and raped by the drivers, Didi had become the target of condemnation, products and services were banned by the government, the economic loss more than $3 million and the corporate image get damaged. So today is a very important turning point for Didi. It very necessary to find out the way to protect the passengers and drivers while redeeming the image or fall into the abyss.

The problems which Didi facing is customers losing and image damaged. Those problems are as the result of sexual implication advertisement, the leakage of passengers’ personal information and appearance-based rating system. So, I would like to talk about why Didi should make some change, how to redeem the image of Didi and way to solve those problems and protect the riders and drivers and what can happen after making changes.

Background

Uber, the biggest ride-sharing company in United State was also encountering the same thing. Seems like it is a global question for ride-sharing company, the passengers are vulnerable and murdered or robbed by the drivers. But Uber hired a new security executive and made some changes to protect the benefits of theirs and customers.

I did a survey which is my major source about how safety Didi is with all my respondents are or were Didi’s subscriber. I would like to use this source to show how people think Didi’s safety problem and integration the opinion to give the recommendation. According to my survey, all of the respondents who are or were Didi’s subscriber think that Didi needs to make a change, no matter for protecting passengers or redeeming its image. Because they think Didi is not safe while providing convenience. The most serious thing is 41% of respondents said they never use Didi anymore and uninstall the app after passengers were murdered.

Also, I collect some news report from the website as my secondary source. The news including the detail report of two female passengers raped and murdered by the drivers, the affection Didi took after things were exposed and what change did Uber do after riders murdered by the drivers. I will use those news report to explain the influence after things were exposed and introduce the importance that Didi need to make changes to protect its passengers, and the action should be taken to protect the passengers and redeem the image.

Discussion

In this section, I would like to talk about the affection that Didi taken after two female passengers are raped and murdered by the driver, and the way to make changes to redeem the image of Didi company and protect the passenger. I would like to explain those in five respects: Why Didi should make some changes, the way to protect passengers, way to redeem the image, the effect after making those changes and the cost of making changes.

Why Didi should make some changes

After the news that two female passengers were raped and murdered by the drivers exposed, it has aroused widespread concern and comments from all walks of life. Because people thought that although this phenomenon has constantly been the subject of public opinion, yet, up till now, no evident sign of improvement has been observed and the matter is even going from bad to worse. So they doubted that if the Didi company cares about the passengers’ safety. According to a report from Baidupedia, on August 25th, the Zhejiang Provincial Road Transportation Administration made an emergency interview with the person in charge of the Didi Chuxing Zhejiang District. In view of the major safety hazards in the Didi Chuxing’s free ride business, the Zhejiang Provincial Road Transportation Administration required the Didi company to be immediately rectified and suspension of its free ride business in the Zhejiang region during the rectification period. Also, on August 26, the Ministry of Transport and the Ministry of Public Security, as well as the transportation and public security departments of Beijing and Tianjin, conducted a joint interview with Didi, and ordered them to immediately rectify the free ride business and the hitch serve. Which means that the free-ride business and the hitch serve were banned by the government for the major safety issues.

What’s more, because of the safety issues, there were tens of thousands of comments which were all talking about the female passengers murdered by the driver case on China’s dominant social media platform Weibo. The users were mostly said “Didi is a bad company which connivance the crime and only focus on how to earn money from its customers”. Other users are pointing out the service had “brought a lot of conveniences” and that they are hoping the situation will be rectified. The business image of Didi company is damaged, more and more people think Didi as a company which only cares about how to earn money from the passengers and driver, while racking their brains to earn revenue and reduce the cost. That means huge disaster for a company if the company image getting like that as “supremacy of interest” and “unkindness to passengers’ life”

As a result of that, the Didi company is losing its customers. The company image damaged become the fuse of losing customers. More and more people said that they will not trust Didi company anymore. What’s more, there were a lot of celebrity posted their Weibo and said that they will never use Didi any more and got the match of most user in Weibo platform. Also, some celerity who was one of the users of Didi Chuxing uploaded the photo of uninstalled the Didi Chuxing App while they posted the Weibo to resist Didi company. According to my survey, as shown in Figure 1, 41% of my survey respondents who are or were Didi’s users think that they never use Didi Chuxing anymore after the case expose. However, there are 7.69% of my respondents say that they already uninstall the Didi Chuxing App from their phone and never use it anymore. But all of the respondents who has been used Didi Chuxing after exposure said frankly, they use Didi Chuxing fewer times than before. Which means that because of the passengers were murdered case, Didi loses about 40% of customers. Even if there are still almost 60% customer used Didi Chuxing after the case expose, they used fewer times than before. So it is very obviously that Didi company loss tons of business from its customers and potential customers. And what’s worse is that Didi loses nearly 8% of its customer forever. That is a huge number to a service-based companies. This number means that 8% of Didi’s customers are despair of Didi company and a “more than 8%’s” market share declining. And it also means a major blow to the Didi company. The Didi company get into the dead loop of image damage and loss of customers.

Figure 1: The utilization ratio of Didi after case exposed

According to Bloomberg, “Chinese actress Wang Xiaochen posted screenshots of her phone to her 9 million followers on Weibo, China’s equivalent to Twitter, as she deleted the Didi app with a caption saying “goodbye!” The viral update received 285,000 ‘likes’ and generated over 40,000 comments – many of which were followers showing proof they’d done the same.” Because of the dead loop of image damage and loss of customers and the declining of market share, Didi has lost more than 4 billion yuan, or $582 million, in the first half of 2018. Which means that it still has a long way for Didi to earn money. However, the decrease in revenue has emerged many negative effects. Didi was planning to go publish in the second half of 2018 with an expected valuation of between $70 and $80 billion through an IPO (Ryan, 24 April 2018) while valued at $56 billion in 2017. As we can see, God does not stand Didi’s side, Didi still does not appear on the market until now.

What’s more, the bad influence of image damaged just showing up: Didi’s company potential assessment is declining. Didi generated $5.4 billion in revenue on the back of $23 billion bookings with paid out over 11.7 billion yuan in subsidies to drivers and passengers. After stripping out those costs, the company averages a razor-thin margin – before factoring in any additional costs – of 1.6 percent. So, the shareholders and some financing institutions think that Didi does not have more potential than before because of the frequent scandals. As the result, although thanks to backing from the likes of Apple and Japan’s SoftBank, Didi got only $12 billion cash as an investment in first half 2018. It is much less than in the second half of 2017’s financing. Meanwhile, Uber, the top competitor of Didi, which raised $500 million from Toyota last year at a $72 billion valuation. It is very obvious that Didi get less financing than before due to the death of the passenger.

 Figure 2: The funding of Didi’s and Uber through 2009 to 2017

From the Figure above, we can learn that Didi company had grown very fast from 2013 to 2017 years. But Uber’s funding was always higher than Didi’s except for 2016. But as a result of passenger murdered by Didi’s driver, the financing and funding of Didi emerged a cliff fall. If it keeps for a long time, Didi company will be stagnant and become less potent and cannot develop.

So, it is very important for Didi to make some changes to protect passengers and redeem the image. If not, Didi company will face the problem like losing customers and business, losing market share, losing competitive power and leading to less financing with a result of being a stagnant company. What’s more, for Didi company, the bad influences from redeeming image is an infinite descending death cycle. If Didi company do not take the measure in time, the things will get worse and worse.

The way to protect passengers and redeem the image

At the very beginning, I would like to talk about the product orientation of Didi Chuxing. In mainstream cognition, Didi Chuxing is kinds of a product of sharing a car and provide travel convenience like Uber. The Didi’s former product manager Lijie Huang said in an interview (Ifeng, 2018): “When the scale of the Didi ride-sharing is guaranteed to ensure that the platform will not die. The next step is to explore the social and effective social needs of the user scene”. She even believes that the future will be a trading platform where car owners and passengers can communicate freely. The travel time, travel location, travel intentions and even prices of both parties may be exchanged. At the time, Didi Chuxing will become a “free market”. And, the following of becoming a free market, is a large-scale social behavior. “If we can all do this, it will definitely become a new way of life, and this way of life is to influence society with attributes that change the relationship between people, and the trick will have become an influential cultural carrier,” Huang Jieli said at the time.

However, because of a heart that is eager to socialize and overly aggressive prejudgment for the future. So, there is a lot of social considerations in product design. For example, fill in the user’s basic information, labels, and so on. And these are just one of the core reasons why Didi is being criticized today. The overemphasis on social attributes has deviated from the original intention of Didi as a full travel and ride-sharing platform. Because nobody knows that how many people really want to make friends while riding a car? In fact, the product design of the Didi Chuxing has always been in accordance with “social”. The occurrence of two murders is also generally considered to be related to social interaction. So, first of all, Didi should change the product positioning of Didi Chuxing.

The next one is removing the advertisements which contain date and sexual implication. In a murder case, Didi play an important role that through advertising and product function settings, it constantly hints to the driver users that driving a car can be dated with the opposite sex. In the set of advertisements in a version of Didi, dating or even one-night stand became the main element.

Figure 3: The safety rating of Didi (10 is unsafe, 1 is safe)

Perhaps through these advertisements, what Didi wants to do is to let the driver and the passengers put down their minds about the carpooling and, take the brave first step towards the first carpooling. In reality, however, these advertisements have a more dangerous effect than the Digestion Imagination: the lust that allows some men to have nowhere to place, and finally has a venting outlet. It is unexpectable for a ride-sharing company with those kinds of sexual implication advertisements. But Didi can place the advertisement with core information is “cheap price” and “intelligent planning route” to highlighting the comparative advantages of Didi Chuxing.

The third one is to Protect and respect passengers’ privacy and personal information. On the driver-side version before the drip-suspension business, you can see a lot of information about carpool users like genders, ages, work industries and units, trust value and even the mobile phone model. But honestly, among these materials, only the trust value is the reference basis for the owner to make a decision on the passenger’s order. Other genders, ages, work industries, and units are all redundant. Although that redundant identity information is not related to the business, have largely become the basis for the decision of the driver to decide whether to take orders or not: the drivers want to pick up the passenger who has the same topic as their own industry, similar to their own age and live close. These thoughts are normal and nothing can be understood. The problem is to inform the driver of more information without the other party’s consent. The problem is to cater to some people’s voyeurism through the setting of product features. The passengers did not know that their personal information was in the eyes of the driver. But it did violate the privacy of passengers.

Provide the unnecessary personal information to the drivers not only violate the privacy of passengers, but also make the passengers more vulnerable in the trip. So, Didi can simplified the driver-side app and reduce passengers’ personal information. In this connection, Didi can learn from Uber, let the driver know nothing about the passenger before taking order but the system help them to pick each other. Or let the passengers to pick the drivers.

The next thing is to remove the appearance-based rating system with “safety factor” rating system. Unlike previous advertising and user profile disclosure, this setting of DIDI is an alternative, new form of mental humiliation for passengers: as a passenger, you will be forced to accept one after another wretched strange driver and companion, for your all-round evaluation from top to bottom, from appearance to sound. As for the labels in these evaluations, “very polite” and “punctual” are still useful; “intellectual beauty”, “face value burst”, “sound is sweet” are all in the category of wretchedness. And, these tags have nothing to do with the nature of ride-sharing.

But Didi can have the “safety factor” rating system instead of the old one. The drivers and passengers can mutual evaluation with few questions about safety like: the passengers arrive the aboard position on time, passengers do not smoke in car and so on.

To protect passenger and drivers’ personal information and pricavy, Didi can launch the “number anonymization” function which Uber launch in 2015(Pingwest, 2018), and the driver can only contact the passengers via a randomly generated virtual number, texting or telephone when ordering. This number will be destroyed after the end of the order, unless the passenger gives his or her own number, the driver will no longer be able to get in touch with the passenger.

Also, Didi can redesign the app for both drivers and passengers. On the drivers’ sites, the drivers should take a face recognition before taking every order. It works like iPhone’s new techniques, but, compare the current driver’s facial features with the one which uploaded when the drivers sign up. On passengers’ sites, Didi can do the Uber way, adding a 911 button (Lindsay, 2018). The 911 button can automatically send the location, the make, model and license plate of the car and the drivers’ information to the police when you click it. What’s more, the Didi Chuxing application will record the voice during the whole journey after the driver take the order. The voice record can be saved in 7 days in case of passengers or drivers are disputed about this trip.

Last but not least, Didi should set up an emergency response system. In the second murder case, the customer service should bear the main responsibility, for the female passengers cannot get the help on time. The inefficient Didi customer service are always controversial, people complain that the problem has never been solved, or sometimes don’t even get a reply. So, an emergency response system and a high efficiency customer service are necessary. The emergency response system should intervene while the passengers or the drivers get into trouble. And, send the location, the make, model and license plate of the car and the drivers’ information to the police. It works similar as what the 911 button do, but it can take the initiative to contact the driver or passenger or the emergency contact while things get into emergency.

The cost of making changes

The cost of measure changes is less than the losses that Didi sustained in the future. What it costs is to hire a professional safety Advisor and a group of high quality customer service staff to set up an emergency response system. And the cost of redesign the rating system after finishing the order and add a 911 button during the journey. The most expensive part is the design fee of redesigning the Ads and re-advertising on the major platforms.

The effect after making changes

After taking those changes, Didi’s customer no longer needs to worry about the safety problem. The new ads, which with the information of is “cheap price” and “intelligent planning route” to highlighting the comparative advantages of Didi Chuxing, Didi should become the most competitive enterprises and redeem its image. At the same time, more and more customers are attracted by the low price and safety guarantee ride-sharing app­—— Didi Chuxing. So Didi Chuxing can get a larger market share with more business than other ride-sharing app. The prosperous business will attract more investment and Didi get more financing to develop new markets. So, it will become a rising and favorable cycle which pushing Didi being better and better.

Conclusion

I have been talked about why Didi should make changes, the way to protect passengers, way to redeem the image, the effect after making those changes and the cost of making changes. Hope the thing that I talk about can help you to make Didi a better company. If you read and put it into action carefully, I think Didi can earn a great success on turning loss into profit, winning back the customers and redeeming the company image.

Recommendations

        Change the product’s position of Didi Chuxing

Focus on the ride-sharing part but not make it as a social software.

        Remove advertisements which contain date and sexual implication

Should place the advertisement with core information is “cheap price” and “intelligent planning route” to highlighting the comparative advantages of Didi Chuxing.

        Protect and respect passengers’ privacy and personal information

Let the driver know nothing about the passenger before taking order but the system help them to pick each other.

        Remove the appearance-based rating system with “safety factor” rating system

The drivers and passengers can mutual evaluation with few questions about safety like: the passengers arrive the aboard position on time, passengers do not smoke in car and so on.

        Install an emergency button (911 button) into the application

The 911 button can automatically send the location, the make, model and license plate of the car and the drivers’ information to the police when you click it.

        Using Facial recognition technology to Strengthening information audit of drivers

compare the current driver’s facial features with the one which uploaded when the drivers sign up.

        Set up emergency response system

it can take the initiative to contact the driver or passenger or the emergency contact while things get into emergency.

Bibliography

  • Bloomberg (2018, August 7). China’s Didi Chuxing suspends carpool service after second woman killed. Time. Retrieved from http://time.com/5378794/china-didi-chuxing-suspended-woman-killed/
  • Bramson, L. (2018, June 1). Uber hopes to protect passengers with new safety feature. News4. Retrieved from https://www.wsmv.com/news/uber-hopes-to-protect-passengers-with-new-safety-feature/article_70acc1ed-a582-5e02-a6a6-1edbc0718dfe.html
  • Chandler, C. (2018, August 29). Why once invincible Didi Chuxing is looking mighty vulnerable now. Fortune. Retrieved from http://fortune.com/2018/08/29/didi-chuxing-murder-china-uber/
  • Edward, B. (2018, September 5). Uber launches more safety tools to protect riders, drivers. USA Today. Retrieved from https://www.usatoday.com/story/tech/news/2018/09/05/uber-launches-more-safety-tools-protect-riders-drivers/1200448002/
  • Spectrum (2018, May 17). Why do Silicon Valley companies do better in protecting passengers’ safety? Pingwest. Retrieved from https://www.pingwest.com/a/166688
  • Ecompany (2018, August 27). In the case of two passengers killed in three months, why is Didi not willing to completely go offline free ride business. Ifeng. Retrieved from http://finance.ifeng.com/a/20180827/16472601_0.shtml
  • Browne, R. (2018, April 24). Chinese Uber competitor Didi Chuxing reportedly in talks to launch $80 billion IPO. CNBC. Retrieved from https://www.cnbc.com/2018/04/24/chinese-uber-rival-didi-chuxing-in-talks-to-launch-ipo-wsj.html


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