Gokada, one of Nigeria’s pioneer in the bike-hailing business, says it has built a brand over the years that attracts customers without having to offer discounts, and intends to build on it.
Recall that Gokada had previously shut down operations on August 14, 2019, and resumed on August 26, 2019 over rumoured government policy and price war with competitors like ORide and OPay.
According to the company’s Co-CEO, Ayodeji Adewunmi, engaging in a price war is not a sustainable strategy, “We would rather focus on the experience, and the reason we think this is important is that currently today, for every order we are fulfilling, we get about 15 additional orders we can’t fulfil. So it clearly shows that the market is there.
“So for us, it’s not about offering discounts to be able to attract customers, because we already believe that we have a brand that attracts enough customers. Even with more brands (competitors) on the road, demand will continue growing,” he said.
With ORide already in three more states apart from Lagos, Gokada insists on making Lagos its fortress rather than allowing the expansion of ORide across Nigeria to dictate its pace.
Gokada says that it’s not in a hurry to expand like its competitors; rather, it prefers to do the bike-hailing service better.
For Adewunmi, the revenue potential of the bike-hailing market in Lagos is enormous, so there’s no need to rush to conquer new grounds. “We will not go to other cities because competitors are in other cities. We believe that Lagos is a massive opportunity, Lagos is approximately 750,000 okada market and on the back of the 750,000 okada, we are talking about 4 to 5 million rides a day.
“And on the back of that, we are talking about 3 to 4 and 5 billion dollar revenue opportunities. So we are not in a rush to be everywhere at the same time. Also, we are careful about how we deploy our capital because, at the end of the day, we believe that will be what differentiates us. Lagos State’s potential upside is really tremendous.”
While the talk of possible regulation by the Lagos State Government has drawn criticism and also been described as a threat to the growth of the bike-hailing market, Adewunmi says that regulation of the business will create an advantage for players in the market and attract needed investors.
“I think regulation will create a lot of advantages for the business. It will create the enabling environment for even more investment to come to space. So it’s something that we 100% embrace.”
He also added that the company is working with the executive, and legislative arms of government to ensure that whatever the conclusion is, “we can contribute to the regulation.”