Q: Do you think the NYC taxi market is ripe for disruption? Why or why not?
A: It certainly is. Even though there are few competitors which could represent monopoly power, the inherent business model is inefficient. Taxi companies have had the exact same model for 30 years and have not evolved. They are severly lacking in a few key competitive areas: Cost (labor and car costs are very high), Customer Service (no online/app precense, unfriendly drivers, etc.), Revenue Model (sales only via rides themselves, no sell-on services such as in-car item purchases, product deliveries, etc. etc.)
Q: How would you devise a market entry strategy for this entrepreneur?
A: I would identify and take advantage of the major weaknesses of the NYC taxi market (see Q&A above). In particular, I would look to lower costs by implementing car sharing/switching (currently, every taxi driver owns their own car), and looking to make drivers cheaper (replacing with automous technology, or changing the pay structure). In terms of revenues, I would look to sell additional items (food, chargers, tv viewing, etc.) in the car as well as use driver idle time (i.e. when they're looking for riders) in other productive ways (delivering packages, food, etc.). Finally, I would improve customer service by having the ability to schedule and hail cars online and/or via an app as well as provide training + incentives for drivers to offer friendlier customer service (i.e. via ratings or bonuses).