Hailo vs Uber

Why $100 million in funding didn’t equal success: The Hailo failure

October 30, 2017

Hailo launched in 2013 as a way to hail cabs. Utilising existing New York yellow taxis, this app had a lot going for it including $100 million dollars in funding and a recent legalisation of e-taxi services in the area. This app was predicted to be a huge success —except of course, it wasn’t. So, why did it fail?

In a sentence: no one used it. It fell short of what is known as “user adoption”. Its initial differentiator was to offer exclusive pricing for yellow cabs which didn’t transfer to usage because Uber was very much committed to competing on price. Hailo also based its app on London’s taxis practices. In London, taxis are more of a luxury, streets are older and confusing and cab drivers typically have lots of information to share with riders. New York taxi services don’t have these attributes. New York has gridded streets, and the barrier to becoming a taxi driver is much lower. Hailo also believed that taxi drivers needed help finding fares. That’s not really the case in New York City.

Thus, their poor planning and intense competition meant there was virtually no adoption by either taxi drivers or those needing a cab.

The technology wasn’t unneeded, it just wasn’t packaged in a way that made sense for adoption and usage.

Looking at a recent survey and its results, key findings indicate that user interface issues and performance were the leading issues. The study also found that surprisingly 44 percent of all QA is coming from uses. Users are the ones identifying defects; not internal teams! More testing is of course an absolute necessary to address these issues. According to another recent mobile app performance study , 53 percent of users experienced “severe” app issues in the last six months, including apps that crashed or simply didn’t perform as expected. When users continue to experience these issues, they will abandon usage and not return. This abandon rate can be demonstrated in a hype cycle, which represents the maturity, adoption and social application of specific technologies.  The hype cycle provides a graphical and conceptual presentation of the maturity of emerging technologies through five phases. This methodology allows organisations to understand how technology will evolve and can offer true insights on how to manage an app’s deployment. In the hype cycle, if expectations completely fall due to user issues, the graph will plummet to the “Valley of Oblivion” wherein users completely abandon the technology and never reengage.
The user experience continues to be a failure area as well. More testing will help, but it needs to start from conception. The problem is many developers struggle with determining what a great user experience means. Developers aren’t the audience; they are also “too close” to the project and suffer from bias. That’s why many different people need to be involved from the beginning of the design. It’s a good idea to have user advocates, who are able to look at function and features as an end user and communicate this to the developers.


4 Crucial strategies for adoption

Post design, what does the path to adoption look like? What strategies need to be used? Whether the app is for internal staff or consumers, there are some key points that can reinforce adoption.

1. Content Marketing

Beyond just simple advertising of the app on your website or on actual locations, consider a variety of ways to market your app. One way is to use content marketing. Content marketing allows you to tell different stories about why the app matters to your audience. Write blogs on its benefits, not features. Tell readers the way in which it will simplify his or her life. Develop an infographic on the differentiators of your app. Focus on the user’s experience with the app in your content.

FitBit works hard to deliver content that enhances their users’ lives and keep them returning. They publish results blogs, but they don’t push their product. Their content is more about lifestyle subjects.

2. Awareness and education

Basic marketing will provide the awareness piece. But how are you reinforcing that throughout your brand? Are your customer service agents reminding those that call in for help about the app? Maybe customers aren’t aware of what they can do in the app, which could have saved them the time of making a call. Further, find opportunities to educate on your app. Host a webinar on why and how it works. Offer thought leadership ideas on the challenges your app solves.

Banking is a segment of apps that works to educate users and push them to the app for transactions and activities. Wells Fargo has in app alerts to tell users what’s new. They also push reminders at ATMs. Customer service agents also encourage customers to use the app. Using the app allows for more convenience for the customer and less costs for the company.

3. Social media marketing

Consider a concerted, consistent social media marketing campaign to introduce and drive adoption of your app. Each platform may serve a different purpose. Use quick DYKs (did you know) tweets on Twitter highlighting your app features or benefits. On Instagram, share images of the app interface. Target your audience on social media with ads promoting your app, focusing again on why that user should use it.

Bejeweled, a popular game app, launched a campaign to generate interest and get players back on the app. The campaign lived on Instagram and encouraged users to find their #shinyplace. It included user generated content from Instagram influencers with one video being viewed 1.5 million times.

4. Incentivise

Getting someone to download and use an app is hard! But most users can’t resist an incentive. That means the app must have certain features not available on the mobile site. You can also offer discounts, coupons or other usage incentives for the download and use of the app. This may drive immediate adoption, but building app loyalty is the second greatest challenge behind adoption. To encourage regular use of the app, you’ll need to consistently offer exclusive deals and promotions that can only be redeemed via the app. This can help prevent drop off after initial usage.


When considering developing a mobile app or improving an existing one, you have to think about many different aspects of the process. Design and development are just the beginning. Translating ideas to mobile apps can be a long and involved process. But you must also be prepared for what comes next. Why will anyone want to use your app? How will you communicate all the benefits and features to the right audience?

You’ll need to have a strategy for launch and adoption of your app as well as additional strategies to encourage continued usage and combat attrition. Working with a diverse team of experts from an app development company that understand both the technical and development requirements, as well as weaving in the user experience and adept marketing, can help boost your mobile app’s usage in the beginning and beyond.

Learn more about successful app design, deployment and adoption with Appscore

About Paul Dematteo

Paul is an industry expert in digital solutions. He works daily with clients such as Telstra, MediBank and Samsung to solve their everyday problems in ways that deliver long term results. Want to talk to Paul about how he can get your business working better for you? Fill in your details below:

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