3 Types Of E-Scooter App Business Models Explained

Last Updated on December 1, 2023

E-scooter is taking over the transportation sector across the world. It has given the common people freedom of choice and comfort in traveling. If we believe the Statista reports, it is expected that e-scooter apps will have around 125 million active users in 026.

What Is An Escooter App?

The e-Scooter app is the modern solution to transportation issues. It is an app where an individual can reserve an e-scooter for transportation purposes. 

How Do Escooter Apps Operate?

The E-scooter apps are quite upgraded in technology. An individual needs to download a specific app on his device and register with his details. After that, the app will provide him options to rent, subscribe, and book a ride.

The passenger can select as per his choice. However, there are apps with only one option as well. 

Different apps utilize different models of business to target a particular market. The e-scooter business models are a tool to grow in the modern markets. It is important to finalize your E-Scooter app business models before launching your own App. Currently, there are 3 main types of e-scooter business models

Types Of E-Scooter App Business Models

1) Rent-Based Model

In a rent-based model passenger just needs to download the app and check for nearby available scooters. Then going to the nearby e-scooter the passenger needs to scan the QR code on the vehicle through the app. After completing this step the, the passenger is ready to go. 

However, there can be one or two more steps before riding if the passenger is a new user of the app.

Once the passenger has completed his journey he needs to finish the ride by scanning the QR code again. After that, a bill will be generated with all the charges in detail. The customer can find it in the app. 

Key features:

• Charge to unlock the scooter
• The customer is charged for every minute of usage
• Customers gain flexibility

Threats:

• Maintaining cybersecurity can be a threat for the parent company
• High chances of physical damage to the scooters
• The scooters need to be recharged immediately after every usage so requires a huge employee chain

Example: Lime is a prime example of utilizing a rent-based system. Lime is a US-based e-scooter app. 

• Lime was founded in 2017
• Lime operates in over 30 countries
• Lime charges $0.15 per minute with the scooter unlock charge

Related Read: Guide To Make An Escooter App Like Lime

2) Subscription-Based Model

The subscription-based model is gaining user interest massively in recent times. As it provides the customer’s surety of having a scooter for a subscribed length of time at a specific fixed price. 

In this model, the customers gain the freedom to ride as much distance as they want and pay the same amount. This model is aimed at retaining customers. In order to do that the apps provide special offers and discounts in the subscription model. Covid-19 has also helped the apps with a subscription-based model in growing. Due to the fear of the contagious virus people preferred to travel in a safe manner. Subscription-based models provided them with that.

Key features:

• In the subscription-based business model customer is charged upfront
• Gains customer value by providing the user feeling of owning a scooter
• Cybercrime is not a big threat in this business model

Threats:

• In this business, model plans need to be priced at an average cost in the initial stage
• The risk of cancellation is present in the subscription-based model
• Due to high competition, the app using a subscription-based model needs to give the customers exciting offers such as free repairings. 

Example: Unagi is one of the best in the e-scooter app business. Unagi has a subscription-based business model. 

• Unagi was founded in 2018
• Unagi delivers the scooter to the customer within 72 hours after purchasing the subscription plan.
• The subscription plan starts from as low as $10 per week

3) Demand-Based Model

Demand-based business models are quite popular in every sector of business. E-scooter apps can also achieve new heights in terms of growth by applying this model. 

In demand-based business models, customers are provided with the app only. Through the app they can book an e-scooter anytime they need. The customer has the freedom to select from a variety of scooter models. Freedom of selecting from a wide range of scooters based on booking charges, features, and extra charges. 

Key features:

• Customers can rent the e-scooter through the application easily
• Customers have the flexibility to choose as per their needs

Threats:

• Cybersecurity can be an extreme level threat 
• The rent-based business model can give tight competition due to the similarity

Example: Uber is a world-famous on-demand transportation app. It has expanded in the last few years at a massive speed. Entering the e-scooter app sector in 2018 Uber has seen huge growth. 

• It is a US-based e-scooter app
• Uber e-scooter was founded in 2018 
• Uber has teamed up with Lime
• Uber e-scooters need $1 to unlock and charges $0.15 to $0.30 per minute

Features To Improve The User Experience Of Your E-Scooter App

• User verification: As an e-scooter app provides a lot of freedom to the customer it will be great if the app verifies the customer. In order to verify that the app can accept any type of government-approved id.

• Wallet addition: As the e-scooter apps provide discounts and cashback frequently it can utilize the wallet idea. The app can give reward points in the wallet which can only be redeemed by paying the scooter fare.

• Fare calculator: In case a customer has his destination pre-planned a fare calculator can be helpful. The customer needs to input his current location and destination and the fare calculator will sum up the charges. 

• Adding OTP system: As online criminal activities are increasing an e-scooter app can add the OTP system to minimize the chances of fraud. 

• Availability: An e-scooter app needs to be available to everyone so availability on both IOS and android is mandatory for growth.

Wrapping Up

E-scooter apps are a booming sector in the market. Due to nature protection awareness, these types of apps are also getting the primary focus from many people. E-scooter apps are quite simple and easy to use. As per a recent survey, 70% of people supported e-scooters as a better medium of transportation. According to Statista, by 2026 e-scooter apps will be generating revenues in a completely online way. All these e-scooter app business models are bringing unique features and options to the customers. However, there are risks linked with the profits as well.

The rent-based business model gives the user full transparency in its process. This way the app Lime has gained customer value. 

The subscription-based business model helps the app to have the payment upfront. In this manner, Unagi generates quite handsome revenue. 

Demand-based business models can be helpful as the customer can book his ride as per his demand. The e-scooter therefore can be a primary choice of customers. Uber has utilized this plan in its e-scooter app.

Managing cyber security can be the best solution for any e-scooter app. As of 2022, cybercrime has not left any sector out of its reach. Frequent updates can be a handy option. It is important to carefully choose your business model as it will be one of the defining factors in your app’s success.

Frequently Asked Questions About Escooter App Business Models (FAQs)