How To Build a Rideshare App: Trends, Features, and Cost Estimations

Maryna Pasko
Market Researcher

Ridesharing is a massive social and business trend that became popular over the past decade in line with the rapid growth of smartphone users. Nowadays, millions of people worldwide share everyday rides for numerous reasons, not least because ridesharing saves money. It’s also positive from an environmental perspective and it provides users with an opportunity to make extra cash on the side, a factor that neatly captures the gig-economy zeitgeist.

Given these factors, it’s safe to say that ridesharing is here to stay. Currently, the industry has its key players boasting multi-billion dollar profits — Uber, Didi, Lyft, and Grab —  but it keeps expanding and promising startups appear every year. The prognoses for the industry's future are encouraging: the ridesharing market will grow by 60 per cent in 2021 compared to 2020, reaching over 117 billion U.S. dollars in economic worth. Ridesharing remains a prosperous niche for investments as well as a great platform for ambitious startups.

If you’re wondering how to build a well-performing rideshare app and get in on the action, this article is for you. Below, we cover all the critical questions, from an Uber-like app’s must-have features to the potential development costs. But before we get stuck into the details, let's review the rideshare app types on the market and get acquainted with the latest trends.

Types of Rideshare Apps: Carpooling And Private Rides

Ridesharing is a cheaper, more convenient alternative to taxi services, as it allows multiple passengers to travel at the same time. Riders going the same direction can book a ride with another person via a dedicated mobile app and then split the fare.

Most rideshare apps fall under two main categories: carpooling and private rides. The first enables people going to a destination to rent available seats in a vehicle; an approach that’s beneficial from both economical and ecological perspectives. One of Europe’s  leading carpooling platforms, BlaBlaCar, is available in 400 European cities across 22 countries. BlaBlaCar is the most trusted carpooling service for long-distance travel, with a community of 1.5 million users.

When it comes to shared short-haul trips, Uber and Lyft are the most used platforms in the U.S. and Europe, while the Grab app dominates the South Asian region. The major focus of these ridesharing companies is private rides, however, for the user’s convenience, carpooling options are available as well.

The private ride spectrum is a bit wider than carpooling. The concept is very similar to  taxi services: people with vehicles offer on-request rides to specific destinations, generally as a private trip. Private rides are pricier than carpooling but still undercut traditional taxi services.

When starting a ridesharing business, it’s essential to consider the industry’s tendencies and latest changes. Get acquainted with popular rideshare trends below.

The Global Rideshare Market: What to Expect in The Future

An increased demand for cost-saving, environmentally friendly travel confidently drives the global transport sector toward ridesharing. In the next decade, the ridesharing industry will grow and prosper; it’s expected to reach USD 209.6 billion by 2025, with an annual growth rate of 19.2 per cent from 2020 to 2025.

Eco-friendly vehicles

Ridesharing can ease traffic and reduce emissions, which are pressing challenges for capitals and highly populated cities. With the rise of environmental awareness worldwide, ridesharing companies are trying to go the extra mile and expand the number of electric cars in their fleets. For example,  industry leaders Uber and Lyft intend to convert their fleets to fully electric by 2030.  

Cheaper fares

With platforms increasing their numbers of electric vehicles,  we might also see a drop in fares from rideshare providers. As fuel expenses make up a significant proportion of ridesharing costs, switching to environmentally friendly vehicles may bring prices down.

Market expansion

Currently, ridesharing services are predominantly concentrated in big cities with dense populations. However, with technological improvements and rising demand, ridesharing may soon appear in smaller towns and even rural communities, providing local people with cost-effective microtransit services. 

To build a well-performing rideshare app, you need to understand the key principles of its functionality. Now, let’s take a detailed look at how rideshare applications work.

How Does a Rideshare App Work?

You can manage each aspect of your trip via a rideshare app. It connects drivers and riders in the area, estimates fares, tracks the vehicle’s movement, and accepts payments for services. But let’s start from the beginning and take a look at how the average ride with an Uber-like service functions.

Log In

Creating a profile with valid credentials is mandatory for both drivers and passengers. After logging in, drivers set their status to online, indicating that they are available for a ride.

Request

Once a customer creates a ride request by selecting pick-up and drop-off points and the type of service, the system starts searching for nearby drivers.

Match

Upon receiving a request, the driver has an option to accept or decline. When the driver is assigned to the ride, the customer gets a notification with ride information including the driver's details, vehicle number, and the estimated time of arrival.

Ride

After pick up at the designated location, the ride commences. The driver follows the app’s navigation system to the drop-off point. The passenger is usually able to track the route via the customers’ app.

Pay

The rider can opt to pay with cash on arrival or make a cashless payment through the system in advance.

Rate

Upon trip completion, both driver and customer may optionally rate each other in the app.

As you can see, ridesharing companies provide separate apps for drivers and riders. Besides, this whole system is strongly supported and monitored by a third party via the admin panel. Below we researched which features are essential for an app-based rideshare service and looked at the advanced features some rideshare services use.

The Key Features of Rideshare Apps

Since both apps (for drivers and riders) are part of one system, their main features are similar. If you start with a minimum viable product (MVP), consider including the following features:

Registration: A basic feature for any app, users can register via their social profiles or by using an email address or phone number.

Requesting and accepting/rejecting the ride requests: Enables the rider to create a request, while the driver, after receiving a notification, may either accept or decline the ride request.

Real-time tracking and navigation: The driver app's navigation system must generate a route to the drop-off point while the rider should be able to track the journey via their application.

In-app chat: To connect the driver and rider before pick up. Both apps should include a built-in chat system.

Multiple payment options: Drivers can receive payments for the service by cash or via cashless online payment systems (like Braintree or Stripe), which are integrated into the app.

These are the main features of an MVP which provides users with a basic rideshare service. An app with limited functionality such as this must be enough to fulfill the user's primary need: getting from point A to point B.

Building an MVP allows you to try your business idea and receive feedback about the product before actually rolling out a scalable and expensive project. MVPs, however, are not competitive in the overflowing rideshare market, so pretty soon you'll think about stuffing your app with a bunch of advanced features. Let’s take a look at some of those now.

Push notifications: This feature enables real-time alerts and updates about the vehicle info, pick up time, payment status, and so on.

Rate and review: Knowing who is driving riders to their destinations is a matter of safety. With this  feature, passengers can check the driver’s rating and read feedback from other riders.

Free in-app calls: The driver and rider can get in touch faster by calling each other via the app.

Multilingual support: Setting language preferences is convenient for the user. Consider adding more languages to your app to attract a wider audience.

SOS button: Safety and security are the great challenges and issues in ridesharing. Try to provide your users (both riders and drivers) with the ability to report emergencies in real-time and ensure immediate action when needed.

Discounts and promotions: As a part of your business strategy, you can offer various discounts and promotions for both new and existing users.

Trip history: This feature enables users to see information that details their previous rides including fares paid and the driver’s details.

Admin panel

An admin dashboard is a central hub for managing and monitoring the platform's operations. Admins provide full-time support for drivers and users from a separate system, which is usually a desktop app. Besides this, they are responsible for checking and screening new vehicles, commission rates, tracking driver performance, resolving user issues, and managing complaints. Admin panels play a key role in maintaining a safe community inside the application.

Given all the above, you probably assume that developing a rideshare app is a long and expensive affair, especially when it comes to fully-featured Uber-like apps. To an extent, that’s true, but for a more detailed picture, let’s look at cost estimations in rideshare app development.

How Much Does It Cost to Develop a Rideshare App?

Many factors determine the cost of app development. Among these are the features and functionalities of your application, the choice of platform, the location of your development company, and so on. You can rely on these criteria when estimating the approximate cost of your rideshare app. Let’s view each in detail now.

Features

The app’s features are a major factor in terms of overall costs. If you intended to build a full-featured application with cutting-edge design and functionality, expect a bill with six zeros in it. Developing a simplified MVP version might cost far less, between $15,000 and $75,000 roughly.

Many ambitious projects such as Uber and Lyft started as MVPs and gradually evolved into large-scale businesses. Developing an MVP is much more affordable and faster  — a huge benefit for startups with tight budgets and limited time-to-market. Learn how our team managed to build an MVP in six weeks.

App platform

After researching your target audience, you will get an idea of which platform is the most suitable for your app’s launch. For example, Uber was released for iOS first as Apple’s market share in the US was then around 80 per cent. 

Many startups enter the market with cross-platform apps developed with technologies like React Native, Flutter, or Xamarin. The cross-platform approach reduced development time and expenses, both significant benefits. However, it also has drawbacks, as cross-platform applications are slower and lack truly native performance. To find out about the benefits and relative costs of Android and iOS app development,check out our articles:

Development company 

The location of developers you hire also impacts the total cost of your project. Developers' salaries and rates range widely from region to region, so consider this while estimating your budget.

For an illustrative example, let’s suppose you hire an Australian development company to build your app. Below you can see the development team completion and the average salary of each expert. 

Source: Salary.com

Based on this data, you can calculate the approximate cost of one sprint. In Agile methodology, a sprint is a  time-boxed segment of the continuous development cycle. The number of sprints required varies in each project and heavily depends on the app’s features and design complexity. For example, our recent project, Atlas, a navigation and traffic app for truckers, took 14 sprints of Android development. We delivered the product with geolocation tracking and navigation features, integrated maps, and added offline accessibility.

Rideshare app development costs range widely depending on the project’s complexity and the number of integrations with third-party services needed. If you have a rideshare app idea on your mind, reach us out and we will provide you with a rough estimation of costs for your project.

24 February 2021 rideshare app development