Sharing Bicycle Situation in Shanghai

Shared bicycles have been a huge boom in Shanghai over the past year. The brand Mobike launched its shared bicycles in April 2016, and they quickly became popular among Shanghai residents. Followers like ofo and Xiaoming Bike also increased their market share, creating a three-way competition. Since 2017, electric bicycles and other brands have joined the fray, ushering in a shared bicycle warring states period.

Walking through the city, you see shared bikes painted orange or yellow everywhere. They're incredibly convenient for commuting, quick shopping trips, getting from the station to your destination, or hopping between shops.

The reasons for this boom are:
・You can hop on and off anywhere
・Plenty of bikes available almost anywhere
These two points.

Shanghai did have public bikes before, but they were the old-style kind where you could only pick them up and drop them off at specific spots. Mobike's innovation lies in allowing users to leave bikes anywhere. While not permitted inside buildings or on private property, they can generally be parked on most roads. Furthermore, to ensure bikes are readily available when needed, Mobike had deployed over 100,000 bikes by the end of March. Increasing the number of bikes deployed naturally increases visibility and awareness, creating a clever system that requires no advertising.

Just as I was impressed by this, the later-arriving ofo launched massive advertising campaigns, rapidly increasing its fleet size and market share. It has now surpassed Mobike in brand recognition. Unlike Mobike's sporty design, ofo's retro and cute design is hugely popular among young people. Walking through the former French Concession on weekends, you'll see many couples on dates riding ofo bikes and groups of university students. These aesthetically pleasing shared bikes are overturning the image of "bicycles = transportation for the poor" and spreading a new image of "bicycles = eco-friendly and stylish."

Interestingly, despite this boom, Mobike co-founder and CEO Wang Xiaofeng states that the revenue model for this "shared bicycle" business remains unestablished. This reflects the unique, laid-back approach of the mainland: "Just start it first, then figure out the details later." The shared bicycle industry is increasingly hard to take your eyes off (the total number of shared bicycles in Shanghai has already surpassed 450,000).

(Supervised by: Dentsu Inc. Global Business Center)