IOU.io industry focus 4 of 4: On-demand services, part two
I know I said in the previous post that this is the last in a series of posts on how blockchain will improve ecommerce in specific industries. But on-demand services turned out to be such an in-depth subject that it needed to be extended into two parts. So I had to give it the Harry Potter and the Deathly Hallows treatment.
We previously looked at gaming, travel and fashion. Last time, in our first cut of our treatment of on-demand services, we concentrated on how national or global e-retailers get their packages that “last mile” from the local distribution center to the buyer’s front door.
That’s because, as I stated then, the “IOU.io team is keenly aware that this industry, which is rife with inefficiencies, is not only a use case in itself, but solving its issues would improve results for merchants across all ecommerce verticals. So none of us dare ignore it.”
Disruptive delivers
One big disruptor of the mobile app revolution was the groundbreaking Uber and its reputedly more woke competitor, Lyft. We’ll focus on Uber because it’s in more markets and its 42 million users have catapulted it to a 70%+ market share for ride-sharing apps.
But it’s not really a ride-sharing app. It’s a ride-hailing app. Your route home from the pub doesn’t just happen to be on anyone’s way. To be fair, though, maybe that’s as close as pre-blockchain apps could offer.
“We think of Uber and Lyft as P2P marketplaces, but they’re not.,” Motherboard quotes Origin Protocol founder Josh Fraser as saying. “They’re peer-to-giant-monopolistic-company-to-peer marketplaces.”
Uber was invented to drive down the cost of a cab, and that’s exactly what it’s done. The price of a New York City taxi medallion, which is set by bidding in an entirely market-driven auction, is $160,000 — or roughly 15% what it was when Uber was founded in 2009.
Its flagship service is UberX, which brings a midsized car to your location and drops you off exactly where you want, which is a slight departure from the luxury cars that Uber initially offered and still does. You can save a few bucks with UberPool if you don’t mind sharing the ride or getting dropped off a block or two away from your destination. You can also request a ride that offers accessibility features. After that, Uber’s offerings get a little esoteric: water taxis, rickshaws and motorcycles — not available in all markets, of course. A few failed experiments included helicopters, hot air balloons and — dear to every crypto-enthusiast’s heart — Lambos.
The only thing we like better than our Gallardo Spyders (someday, someday), though, is disrupting disruptors — and there are already blockchain-based ride-sharing apps vying to unseat Uber.
One of the most notable is Arcade City, which made it a point to move into half a dozen Asian countries that Uber itself had to exit. Of the top five cities worldwide where this Ethereum-based started has a presence, four are in Brazil and the other is the self-styled “weird” metropolis of Austin, Texas. So yeah, ridesharing on the blockchain is already a thing.
Another example is RideCoin, which is still in the ICO stage, but the founders make a strong case for exactly why tokenization is the path forward for this segment. As you’d expect, disintermediation means that riders pay less and drivers keep more. But just as importantly, riders own their own data, unlike the popular model in which Uber knows your payment information, your home address and every location you’ve ever needed a ride to or from.
Hyper-local, hyper-express
More recently, Uber has shifted some of its focus to delivering food from restaurants and, again, leaves itself wide open for a savvy blockchain operator to eat their lunch.
Props to Uber’s managers for identifying a market that has always had great potential but nobody, not even GrubHub, had the capability to realize it until they came along. For generations, every pizza joint and Chinese restaurant has had its own delivery dudes, but it was difficult for just about everyone else. There’s no real reason why national chain restaurants from to KFC to Applebee’s don’t deliver except that there was no obvious incentive. And, with people who had recently given up in-person shopping still in the habit of going out for factory-farmed chicken or a seafood menu where the “catch of the day” is always tilapia, local eateries that catered to more rounded tastes couldn’t make the first move. If you called and asked your local Greek diner or Indian restaurant or gastropub if they delivered, they might have told you “yes,” but you probably never thought to call and ask.
So Uber comes to town and, as a global player, it can work on deals at the top level with the KFCs and Applebee’s of the world, then follow up by asking the locals if they want to subscribe to UberEats. Who could say “no”?
And that’s just one example of a hyperlocal service. Groceries, personal care, home repair and other products and services are all ripe pickings for on-demand delivery. By the way, this isn’t “last mile” logistics, in which Amazon or Walmart or Redbubble gets a product from somewhere — to be honest, most likely China — to your porch. This is local-to-local. This is “only mile”.
Interestingly, this rather niche-y space is being targeted by that scrappy little mom-and-pop, IBM. One of the first critters to escape Big Blue’s blockchain lab was FreshTurf, which involves a use case that, for now, is unique to Singapore. In that city-state, people are accustomed to picking up deliveries not at their homes or workplaces but rather at delivery lockers — essentially post office boxes on steroids.
One startup with a lot of buzz and some deep pockets behind it is Dorado. Its playbook calls for partnering not just with restaurants, but also with such local retailers as pharmacies and electronics stores. So it might be possible to order your Apple Watch 5 from your current Apple Watch 4, then get it delivered to wherever you are rather than wait until you get home. Dorado’s plans call for a convergence of technologies — not just blockchain, but also drones, robotics and machine learning. And that’s smart. Blockchain can’t solve everything, and I’m always initially skeptical of any pure-play crypto startup.
Embracing the gig economy
The legacy generation of mobile apps introduced us to an economy in which anyone can hire anybody to do anything on a freelance basis. To book someone to help you with assembling your Ikea furniture or mounting your flat screen on your living room wall, TaskRabbit and its imitators have led the way. On the business side, programmers, developers, graphic designers, copywriters and other journeymen are available on Upwork or Fiverr.
Of course, when we’re talking about blockchain, the obvious service category that it needs to revolutionize is financial services. But let’s consider ourselves all talked out about that for now and zero in on business and personal services.
For business services, CanYa is blockchain’s first mover.
“Every task creates a smart contract, which also performs the function of a decentralized escrow,” blogger Ben Dickson writes in The Next Web. “When both parties confirm the completion of the task, the smart contract automatically transfers the tokens to the employee’s address. This blockchain model ensures that freelancers receive their earnings immediately after completing their work. It also reduces fees by removing intermediaries. CanYa’s commission fee is 1%, a thin slice of UpWork’s 20%.”
Success isn’t guaranteed. Coinlancer was another example widely heralded example of a blockchain-based freelance platform but appears to have recently gone dark.
There does not appear to be a rival to TaskRabbit that relies on distributed ledger technology, but I doubt we’ll have to wait long. The same code and processes involved in business services could readily be applied. It’s just a matter of some maker putting together the white paper, putting together a team and finding backers who can be persuaded to share the vision. Of course, that’s easier said than done.
As your Dorado dApp will soon ask you, “Do you want fries with that?”
Edward W. Mandel is a strategic advisor for IOU.io , he is an Ernst and Young Entrepreneur of the Year Finalist, Blockchain Enthusiast and visionary behind many successful organizations. An avid entrepreneur, Edward has a knack for designing distinctive business models complemented with superior technology to deliver unparalleled service and profitability. Edward also has been advising and consulting for various successful Blockchain technology and ICO projects and recently launched his own BQT.io P2P Hedge Exchange helping traders connect with each other to leverage their crypto assets.
IOU is a blockchain-based peer-to-peer platform designed to unify ecommerce transaction and customer retention processes, incorporating trade-able IOUs. It is currently raising capital through ICO. The platform can be found online at IOU.io and its community on Telegram at https://t.me/IOUCommunity.
