Bike rental firm trying a new method to make money

As dockless bike rental firms struggle, one has come up with a new way to potentially increase revenue.

Short-term bike rental has become a big business in a large number of markets around the world. One of the biggest operators in the bike rental market is Chinese company Ofo. From its start in Beijing, Ofo branched out to offer bike rentals in Europe and the US. Ofo is a stand-free, or dockless, service. Customers use an app on their smartphones to locate nearby bicycles. Scanning a QR code on the frame unlocks the bike. When riders are done, they can leave the bike anywhere and walk away. Springwise has covered similar bike rental schemes, such as e-bike rental and peer-to-peer bike rental.

However, because the dockless bike companies allow customers to park anywhere, the bikes have a tendency to clutter sidewalks. Some cities have begun to regulate the number of bikes that can be available. The bike rental industry has also become saturated, and bicycle-sharing companies are seeing competition from e-bikes and e-scooter rentals. As a result, Ofo has pulled out of a number of markets, including in the US, Australia, India and the UK. Now, the company has hit on a new idea for increasing revenue – third-party ads. After users scan the QR code on the bike, they are shown a five second in-app ad. Coca-Cola and Chips Ahoy are among the first brands to use the new platform. Ads could also appear soon on bike wheels, saddles and baskets.