The author uses the smartscooter-maker’s product and business strategy pivots as a case study to explain the value of listening to consumer needs and responding accordingly
Every tech startup has to overcome initial difficulties or shortcomings its product might have after it is officially launched. In such occasions what makes the difference between success or oblivion is the capacity to change quickly and correct the fault.
In the case of Taiwan’s electric scooter company Gogoro, many obstacles came after the launch of its path-breaking smartscooter. Founded by former HTC designer Horace Luke, Gogoro managed to raise US$150 million in a Series B round and surged onto the world’s tech and EV (electronic vehicle) stage with a sleek and innovative electric scooter. It had the equivalent to a 125cc engine that was able to reach almost 100 km/h in 4.2 seconds.
It quickly gained momentum with its unique concept of portable battery-swapping stations, where you don’t need to spend hours charging your scooter. You just swap the used battery with a new one and voila! You have quick electric mobility for the urban traveller!
Pushing this idea in a country with one of the world’s largest scooter-per-population density should be simple, right? That wasn’t the case as obstacles were plentiful, but after three serious pivots, Gogoro managed to keep its momentum going.
1. Creating an infrastructure of charging stations
When Israeli electric vehicle startup Better Place tried the same concept in Israel back in 2013, it burned almost IS$1 billion from billionaire backer Idan Ofer to build a network of automated battery swap stations, at the price of US$2 million each station. This process, of course, wasn’t sustainable, so Better Place went bankrupt.
Gogoro faced a similar challenge with a plan to build 1.6 stations per square mile in the scooter-loving city of Taipei. So, in order to avoid Better Place’s mistakes, it created GoStations that resembled vending machines that can be screwed in place anywhere and cost less than US$10,000. In order to set up the current 125 stations in Taipei, Gogoro had long discussions with local businesses, gas and electric companies, the local government and private owners in order to place each battery station.
2. Finding the right price for the right customers
When the final price of the smartscooter was revealed, selling it was difficult. At US$4,100, the Taiwanese public wasn’t very receptive for what was seen as an expensive toy they could only use in the Taipei city area, in a country where you can buy a scooter at Carrefour for US$1,050. The company was too anchored to the ‘Apple concept’ that the public is willing to pay more for a more expensive but high-quality product.
But sales were slow so Gogoro had to make quick major adjustments. After three months and only 1,000 scooters sold, it proceeded to cut the price down to US$2,970 and offered many perks, such as one year of theft insurance, two years of free electric battery swapping and two years of free maintenance.
The market reacted, and so far Gogoro has sold as many as 4,000 Smartscooter models in Taiwan.
3. Expanding outside Taipei
Gogoro’s latest announcement for next summer is about the GoCharger — part of the Gogoro OPEN Initiative to expand to markets outside of Taiwan. Since demand and the number of battery stations can be hard to adjust, the company wants to see owners share batteries charged at their homes or in retail spaces that purchase the portable batteries.
The GoCharger is basically two small batteries that plug into a single 110-volt outlet, a bit smaller than a boombox. It comes in two versions — one that charges a battery in five hours and the other in 2.5 hours.
One of the most innovative traits of the GoCharger is that no matter who owns it, a restaurant or a family, they can register it at the Gogoro system and let anyone use it. If you make it available for 12 hours, you’ll even get paid.
So after these setbacks, Gogoro is now preparing to expand outside of Taipei, with an easier method to establish a charging infrastructure in any city that is interested. Amsterdam will already receive the Smartscooter early this year and the US will follow.
It just goes to show how, no matter how good a tech product’s concept is, it can only survive in the market if it is ever-evolving and adapting itself to consumer needs.
The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, please send us an email at elaine[at]e27[dot]co
Image Credit: Gogoro
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