Posted on: | Posted by: Charles Coleman

A comprehensive guide for “On-demand services apps”: Growth, Challenges, and Future

Introduction: From the last few years, the business world has seen a significant shift. First, internet companies and now on-demand services apps are taking the tech market by storm. On-demand service apps like Zomato, Uber, Netflix, Urban-clap are very successful and motivating many other startups to come up with new ideas to make our life easy and click away. Currently, there are a number of on-demand startups that promise instant delivery of goods with quality services.

Curious to know more about the On-demand services app market and the future scope? For the next 9 minutes, we will be on a journey to the On-demand services industry. We are looking into the reasons why the industry has to boost up the market, who are the top players, the future predictions, and much more.

Growth with On-demand services apps:

Engaging more than 22.4 million consumers every year, the on-demand services app industry has annual average spending as $ 57.6 billion. The online marketplace is the category which is grabbing the maximum proportion of the whole chunk with $ 35.5 billion annually. Transportation is another major industry with $5.6 billion, followed by $ 4.6 billion for Food and Grocery delivery.

The market revenue of On-demand services apps will hit $869.95 Billion by the year 2022 and every segment of the market, contributing to the overall revenue generated. This includes, the Global commercial dry cleaning and washing sector will become 3.4% more in demand in this period, whereas the Flooring segment anticipated a 5% rise in their market value. Plumbing market will also grow by 12%.

Other categories that hold substantial proportion with $ 8.1 billion for other services ( home services and freelancer services) and $3.8 billion and all other categories.

Above mentioned stats are well justified with the increasing demand for on-demand services apps. Any novel idea which serves as a solution to people’s problems or simplifies a complex process will be accepted whole-heartedly. The current scenario of the on-demand services app economy is such that whatever be the industry you’ll find a full-fledged on-demand services app working it in real-time.

Presently, even when the world has a huge number of mobile users who are always up to spend money on any on-demand services, but, there are a large number of businesses who still have to cross the barrier and enter into the on-demand services world. Because of this reason, a part of the business world feels that on-demand services will overturn all businesses all along.

Challenges which are faced by the on-demand services apps:

Regardless of the potential growth of on-demand services apps, there are many challenges in the development are still to overcome. As per our intensive research, we observed there are two main challenges in the development of on-demand technology

Security Challenges

Legal Challenges

1. Security Challenges: The business framework is a mixture of on-demand services such as logistics, vendor management and interfacing, and consumer technologies. As per a survey was done by CITO (2015), mobile application security was referred as the top challenge. The main issues highlighted in mobile security are the utilization of multiple devices, ad-surfing and using mobile phones in unsecured networks, theft, and using unsecured applications. As long as the security actions are proactive, businesses in the on-demand economy are at the front head of the security threats. A large number of mobile apps are certified, but it has checked that many advertisements in certified apps generate traffic towards unsecured networks and uncertified apps. These applications and services are not traceable on official app stores. Therefore, they can potentially ruin consumer experiences and cause a serious threat to advertisers. A three-dimensional approach which is combining networks, devices and applications in a single security layer will improve security and resolve such issues.

2. Legal Challenges: The growing number of legal hurdles for innovative technology companies is in the field of information privacy protection. There is no evidence of legal commitment on behalf of the service provider to collect, store, or transmit personal information. Some businesses affirm to own user information as a part of their contract with the user of a mobile service. Other businesses claim no ownership over user data. Over recent years, the federal government and international legal bodies have expressed rising concerns over customer information privacy and directed startups to take privacy issues into consideration. At the same time, businesses in the on-demand economy will be enforced to maintain and implement security programs to address privacy concerns. Companies that fail to serve privacy and security to users of mobile technologies will be charged with deceptive trade practices.

3. Skillful Manpower: On-demand services demand a lot of skillful manpower, making it pivotal to recruit efficiently, to process the applications faster and complete thousands of background checks.

On-demand employers must provide competitive compensation to attract high-quality, trustworthy people who care about those organizations. Certainly, on-demand brands must compete against one another for workers, too.

4. Communication: Communication is another challenge for on-demand services apps. When a customer expects response or product or anything in minutes, on-demand companies can’t afford to keep them waiting. It will result in losing the customer. A complex network to respond immediately and flawless backup is required for almost every on-demand service.

5. Logistics: On-demand services must be near users wherever they may be. Maintaining a company HQ and hiring representatives for every location of operation can be highly expensive. For on-demand services, profitability needs significant scale in areas with high population densities. Top giants on-demand companies have already conquered these challenges, and that’s emboldening up-and-coming startups. The encouraging economy is also providing tools to make the journey easier for on-demand startups.

Annual Stat about the on-demand services app:

1. Video content on-demand services is one of the fastest-growing industries due to the significant improvement in internet speeds. Commercialization of high-speed internet will further boost this industry. The statistical analysis of 2018 indicates that 55% of video viewers in the US are using paid streaming services. However, 48% of consumers are accessing TV content through online streaming as per Deloitte, 2019. Netflix, Youtube, and other streaming services have tasted success. Furthermore, the eSport market is also anticipated to reach over 600 million worldwide fans $1.5 billion by the year 2020.

2. Healthcare is one of the on-demand services industries. The users are spending $4.6 billion in the industries of on-demand food and grocery delivery collectively. This number does not include customer to customer parcel delivery. Online food delivery market in the US will reach $24b by 2023 if it continues to grow at the present rate.

3.Housekeeping: There is a huge demand for housekeeping services, presently. You can utilize this scope to create a housekeeping app which can benefit people who are in need. Services include dishwashing, house cleaning, gardening, and other chores which are in high requirement. Therefore, investing in this app can help people to find the right individuals to do chores daily. A report issued by Allied Market Research predicts about Cleaning Services Market that the global market is expected to garner $74,299 million by 2022, registering a CAGR of 6.2% during the forecast period 2016-2022. Cleaning services market trends are expected to grow over the next few years.

4. Rental Properties and Lounging: Sellers who want to sell or rent their property can create a booking application. Users can easily find and book accommodations at their preferred location through on-demand rental apps. As per the survey, Airbnb numbers have gone from 1.5 million to 2.5 million in the last year.

User-Type for On-Demand Services Apps

Despite the fact that a lot of people use on-demand services apps for different purposes, the following statistics highlight the characteristics of a majority of people use the channel.

68% of the users have an annual income of $50000.

59% of the users of on-demand apps are male.

The 55% of the on-demand app users are the people comes in the age group of 25 and 44 years.

47% of the users have an annual income of $75000.

54% of the app users are the suburb residents, while only 18% of them are inner-city residents.

Personalization provides via the on-demand services app:

Personalization will be the New Trend: In the year 2019, more companies will watch over On-demand services apps will bring tough competition in the market. All of them will put more effort into connecting with their customers, understanding their requirements, and offering them customized services while working on their on-demand app’s performance level. In other terms, personalization will emerge out as the main element of On-demand services economy in 2019.

Conclusion with the future of on-demand services apps:

On-demand services app business will flourish more from the streets of the US to other locations rapidly with the rise in smartphone users, rapid urbanization, and employment. The ease, on-demand services provide to consumers has made it essential for organizations to continually strive to improve their own customer experience. If they don’t, they risk becoming totally outdated.

In future we can see various innovations amalgamated with Services:

Companies will opt for delivery via drones.

High use of chatbots for multi-experience for customers.

Integration of AR, VR and wearable devices in support of digital business, which ultimately leads to saving resources, time and money.

Payment via face detection technology.

Alliance of IoT with various “On-Demand Services apps”.

The principles of entrepreneurship said one incorporate appropriate technologies in this smart era, surrounded by frequently changing customer needs. Therefore, before developing an app on the “On-Demand service app” idea, it is very much required to analyze and draw customer behavior over it.