Case Study: Traffic Guidance, Social Features Drive Waze Growth

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  • Topic: Automotive navigation system, Traffic reporting, Traffic congestion
  • Pages : 8 (2720 words )
  • Download(s) : 491
  • Published : December 13, 2012
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The article (http://www.bizjournals.com/sanjose/print-edition/2012/05/18/traffic-guidance-social-features.html?page=all)

The article is describing about a APP which provide GPS navigation and real-time traffic information, named as Waze. This app developed by Waze Inc. which is the first worldwide provider of community-based live maps and real-time road information. Waze want to help the drivers to reach their destinations smoothly in congested city. It collecting traffic information from every user who use the app in real time, if drivers carry a GPS-enable smart phone, Waze can collect the driver's location, travel speed and traffic information(such as accidents,construction)according to user's report. Then Waze can help other drivers selects the fastest path. This solution have a additional benefit: Waze can draw their own map by collecting travel route report by users.

The core of their business now is the user base since their business model is all around number of user’s. Waze plan to make money through location-based mobile ads for local businesses. At present, they rely on TV to growth up the customer base, that was successful way after practice. However, there are many mapping industry to compete with Waze, such as Trimble Navigation Ltd. , Garmin Ltd. , and Google etc., but they believe their advantage, faster update and unique features, have a chance to success.

Market

Waze is a free real-time traffic insights and GPS navigation app, it provide alerts of accidents, road hazards and traffic jams to user for free. There are a huge navigation market worldwide, because of every drivers will need a navigator, and since Waze has the unique community-based road navigation function, makes the app more competitive. Waze Inc. was founded in 2009, it is a Israeli navigation company. It hit 10 million users just before 2011 Christmas[1]. Then growth to 20 million in July, 2012. Waze’s users has reached 30 million worldwide by Nov, 2012, which means that there are two million new subscribers every month all over the world [2]. Figure 1 describe this growth.

The map service is one of the core application of the mobile terminal, and Google is one of the biggest map service supplier, based on the released data on Google 2011 TechCrunch Disrupt Conference[3], the number of active users of mobile terminals reached 200 million, accounting for 40% of the entire map services market. This indicates that the potential users of the navigation service in the global market is very huge, many user use mobile map for navigation, so a great navigation software will have a good market prospects in mobile device.

In other hand, Waze is a community-based app, rather the service it provides is a social network established between the drivers, so there are some special features will attract more users, such as the friends location information, private message, road information and gasoline price information etc., It also can login with Facebook, so every friends on Facebook can check user’s driving state and join into Waze. That is one of reasons the users rapid growth.

Although Waze have a large customer base in US and several European countries, it hasn’t develop the Asian market, especially in China, which has huge car and smartphone sales and the worst traffic jams[4]. Drivers in Asian are facing traffic jams problems usually, they really need the app which help to choose the best route navigation. But there is a problem in China’s market, that is the regulation is different form other countries. If Waze can find out a partner in China, the size of the market will be phenomenal.

Business Strategy (Hugh Macmillan,2001)

Waze has created a platform that allows users to share real-time traffic information. There are lots of navigation apps try to provide similar service, but few of them solved the precision issues that come with real-time traffic stoppages. Hence, that feature and mobile navigation proliferated, the...
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