Mobility Data Unlocks Opportunities in Emerging-Market Megacities
Mobility Data Unlocks Opportunities in Emerging-Market Megacities
Governments can use public transport data to inform policymaking. Commuters benefit from real-time data on traffic or public-transport status. Yet, the biggest—and largely overlooked—use for mobile data could be for businesses themselves.
Infrastructure planning firms, research organizations, and banks use cutting-edge data sources to help make cities smarter. For investors, mobility data plays a role as a useful indicator of economic trends. More widely, all businesses benefit from understanding how their customers move, and where they travel every day. But what’s even better is finding the next set of customers that will help grow your business.
Mobility Data Unlocks Opportunities in Emerging-Market Megacities
Innovative mapping and data-gathering technologies reveal previously unseen patterns in people’s movements, particularly in emerging markets, where data production starts from a much lower baseline. This information is helping firms make better decisions on how and where to invest.
For any consumer-facing firm, mobility data can unlock a new view into potential customers, including the over 2 billion people in emerging-market megacities who rely entirely on public transport.
Innovation Brings New Data Sources
Traditional mobility data comes from point-in-time measurements such as traffic counts or public-transport ridership estimates. Expensive and time-consuming to collect, these older tools leave governments largely blind to the dynamism of the mobility ground truth in their cities. The methods are also of limited use to investors looking at market trends, or looking for new opportunities to build out real estate and infrastructure along transport thoroughfares.
We can now do much better. GPS tracking from mobile phones is one example, cutting across transport modes to tell us where people walk, bike, drive, or ride. Smarter traffic lights can serve as information sources while also giving pedestrians the time they need to cross the street. Many companies are working to create platforms that integrate new and traditional data sources to build a comprehensive model of the entire city.
Better Data for Smarter Cities
At the highest level, mobility data tells us where people are going and when. But it can also tell us where people want to go, but can’t.
In other words, we can now quickly see where there is a mismatch between what cities offer and what citizens want. Businesses can find opportunities in those gaps.
Planning firms and research
Take infrastructure planning firms, research organizations, and banks, which all form part of the tapestry of organizations that help make and implement urban planning decisions.
Their influence comes largely through advice for planning and research firms, which improves with better data use. For example, improved survey technology also allows consulting and planning firms to collect statistically significant samples of origin-destination data—telling us not just which public transport routes are heavily used, but where the passengers actually want to go.
Using GPS mobile phone data
INRIX, a transport data firm, pulled in individual GPS mobile phone data to understand the impact of pedestrianization programs on mobility during the COVID-19 pandemic. Importantly, the data goes beyond anything that is publicly available. For the good data that leads to good advice, the value far outweighs the cost.
Banks using mobility data
Banks are using data to prioritize mobility investments. The World Bank, for example, worked with a team in Kenya to identify crash hotspots (blogsdotworldbankdotorg) in the Nairobi road network. The analysis is helping prioritize investments with the Bank’s financing.
Financing transport infrastructure investments
When financing transport infrastructure investments, banks can now account for the entire mobility landscape. For example, the World Bank contracted my firm, WhereIsMyTransport, to provide comprehensive public transport network data for seven African cities. The Bank used this data to inform its investment evaluations for bus, rail, and other urban planning considerations across the continent.
Using a central source of reliable data
In each of these cities, the effort was the first time that the organization had benefited from a central source of comprehensive and reliable public transport network data, including the flexible and privately run vehicles that make up the vast majority of the network. In most emerging-market cities, more than two-thirds of public transport services operate in this way, without fixed timetables or fares, and with varying oversight from government entities.
Ten years ago, collecting data on independently operated public transport outside the sphere of government-run services would have been impossible (or at least prohibitively expensive). Now, with data-gathering software built for the purpose, it’s scalable to every city in the world.
Mobility Data Means Big Business
Aggregated mobility data give investors valuable economic clues. For example, throughout the COVID-19 pandemic, Google and Apple have provided summary mobility reports that have helped inform policy but have also been crucial for investors.
Economics research firms.
Economics research firms now view information on people’s movements as an integral source of “alternative data” that they gather and sell to hedge funds and other investors. For example, Bloomberg notes that mobility data can be “a direct reflection of economic activity and… provides insights into the direction of the economy.”
Granular mobility data can tip off businesses.
On the other end of the spectrum, granular mobility data can tip off businesses about where their customers go or where their next customers are. Just as governments want to know what type of street reforms attract people, companies are looking to invest in the types of areas that tend to prosper. They also want to invest in places where people are already traveling but aren’t yet well served.
A simple heuristic for placing your business to reach consumers: find the roads or public transport that move people between home and work. Indeed, research shows many companies do this already. For example, a study from the Netherlands showed that when firms move, they typically choose locations near roads or public transport.
Helpful transport links on a map.
Looking at transport links on a map seems to be a fairly old-school way to locate a business, far removed from the cutting-edge recommendations that ReadWrite readers look for. Instead, the innovation comes from going a level deeper, looking at individual movements daily, and looking at places where even a map is proprietary.
92% of the largest lower-middle-income cities lack a complete map of their public transport network, suggesting large gaps in mobility data more broadly. But, particularly with newly available datasets in emerging economies, we now have comprehensive information on how people move in the world’s largest, fastest-growing cities. While getting your hands on that data can come with a cost, doing so gives a leg up over other firms.
Direct to the customer e-commerce.
Reaching people in emerging-market megacities is one of the few fast-growing global markets where there has been relatively little serious competition from heavyweight developed-world organizations.
Although that is now changing, with investments flowing in from telecoms to direct-to-consumer e-commerce. Traditionally, businesses tend to be local, as international players are deterred by information barriers and the perception that these markets are complex and unpredictable. Nevertheless, the scale argument is easily answered: a Brookings Institution study of the world’s largest cities found that 80 percent of the top 60 performers came from emerging markets.
The information barriers are quickly breaking down.
Traditionally, supply chains in emerging-market cities are hyperlocal by necessity, since shops and wholesalers need to be on the ground to respond to demand. As a result, companies must sell through several layers of distributors to finally reach consumers. Each layer adds costs, decreasing the market’s attractiveness.
That is no longer the case. With city-level datasets, businesses can play on equal footing, knowing where their customers go each day, how they get to work, and which shopping centers they stop at on the way.
Showing the Way Forward
New sources of mobility data are improving our cities and bringing new opportunities for businesses. Especially in emerging markets, now is the time to put that information to work.
Image Credit: martin pechy; pexels; thank you!
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