How FREE NOW CEO Thomas Zimmerman Matches Marketing & Audiences to Drive Mobility Growth

How FREE NOW CEO Thomas Zimmerman Matches Marketing & Audiences to Drive Mobility Growth

What do you get when you combine two of the world’s oldest automotive companies with three of Europe’s leading taxi-hailing apps? A phenomenally successful mobility company that’s much more than the sum of its parts.

Today Hamburg-based FREE NOW is Europe’s largest e-hailing app. It dominates the market thanks to significant investments by BMW Group and Daimler AG (Daimler Mobility) and a laser focus on changing mobility and the customer experience. According to FREE NOW CEO Thomas Zimmermann, the company has employed intelligent market segmentation and a personalized approach to meet customers where they are.

Exponential Growth and Mobility Types

Lockdown forced all mobility apps into survival mode. FREE NOW used the time to rebrand and expand its offer to include e-mopeds, e-scooters, and car-sharing. Today, Zimmermann says, the company reports as much as a 6x volume uplift in some cities.

FREE NOW owns the road with over 170,000 vehicles available to customers across Europe. “There is no other provider in Europe that offers the same broad spectrum of mobility,” Zimmerman says. To maintain that edge, FREE NOW has focused on deepening customer relationships, not adding assets.

One selling point is the sheer volume of available vehicles, resulting from the company’s decision to integrate other providers rather than create its own fleet. “You really feel the benefit of opening your app and seeing, Okay, the next scooter is there, regardless of which provider, because we’ve integrated all the big providers,” Zimmerman explains.

Smart Lessons from Gaming

Building the FREE NOW brand from a ride-hailing company to a true multi-mobility company requires the company to offer choice and, more importantly, enhance the user experience.

It’s where Zimmerman relies on the data-driven approach he developed during his roles as CMO of Goodgame Studios, a leading free-to-play, online and mobile games development company providing quality experiences to over 500 million registered users worldwide.

In gaming, he explains, marketers learn to master data because it is “how you address the user.” All marketing and messaging are deeply intertwined with players’ actions in the game and the gaming ecosystem. Moreover, data and insights around player actions impact how marketers and marketing communicate with users across all channels.

It’s a similar approach at FREE NOW, with one significant difference. Gamers can be always-on, but customers only need a ride when they need it. “Our touchpoint is when you need to get from A to B, and then our touchpoint is gone,” he explains. For FREE NOW, it’s “critical” to match marketing with context such as time of day, day of the week, and weather outside. “It gets pretty multidimensional,” he says. “We need to try to incorporate and learn about our customers, in which situations they are when they open the app.”

Encouraging Cross-Mobility Usage

As Zimmerman sees it, the bigger the buy-in to all that FREE NOW offers, the greater the customer loyalty. “If you have only used ride-hailing in the past, we try to motivate you also with incentives to try out new types because we think it’s beneficial.”

Still, marketers must balance between recommending more options and just sending annoying notifications. “We really try to segment in a way where we give users helpful and relevant information,” Zimmermann says.

He also has a formula for testing the effectiveness of notifications. If a customer doesn’t react to a message after a set number of times (three to five times depending on the customer segment), FREE NOW will stop sending them altogether.

The key here, he says, is to encourage users to enjoy a broader spectrum of mobility offerings. In fact, Zimmermann has observed that customers that use the most mobility options are also the most loyal to the app. “Users that use across mobility types have the highest return rate, have the highest CLV,” he explains. “For us, the goal is to have as many of our users as cross-type users and not single-type users.”

For more insights from Thomas around the best ways to build a larger and more loyal user base, listen to the entire episode. (Full transcript is below.)


Mobile Marketing is Easier with Expert Guidance

Full Transcript

John Koetsier: How do you take something old, something new, and combine them both to invent the future? We think mobility apps, innovators and personal local transport, and ride-hailing. Well, you might think Lyft, you might think Uber, especially if you happen to live in North America, not so much in Europe. In Europe, there’s another competitor that offers almost 200,000 vehicles, serves 14 million passengers, and is available in over 100 cities. And it’s a collaboration by two of the oldest car companies, literally, on the planet. It also pledges to be 100% pollution-free by 2030. Welcome to “CleverTap Engage.” My name is John Koetsier.

Peggy Anne Salz: And my name is Peggy Anne Salz. And together, we profile executives and companies achieving meaningful, memorable, and clever customer engagement. In this episode, we’re chatting with the CMO, as you said, John, in the ride-hailing space. An App vertical that is seeing massive volume post-pandemic, as trip volumes rebound. And it’s also seeing greater demand than ever for friction-free experiences that offer consumers convenience. This company braved global events to acquire new brands and pursue its own rebrand in the same process. And it’s well on its way to becoming Europe’s largest e-hailing app, a mobility venture between two car makers: BMW and Daimler. And it has also expanded into other areas: scooters, electric vehicles, and mopeds. Our guest is Thomas Zimmermann, the CEO of Free Now. He was once the CMO, so he’s moved up. And before that, he’d held several senior marketing positions, including CMO at Good Game Studios. Welcome. Great to have you, Thomas.

Thomas Zimmermann: Hi. Thanks for having me.

John Koetsier: I want to get into it from this angle here in which you’re building something entirely new, right? You’re competing with companies that are five years old, seven years old, eight years old, that sort of thing. But you’re coming out of companies that are over 100 years old. How are you balancing that challenge?

Thomas Zimmermann: The company originally, Free Now, was founded, I think now, 11 or 12 years back as One Touch Taxi. So, disrupting the classical taxi dispatching in Europe, doing that through an app, at that point in time, was really something new. Not so much anymore today. So then, over the course of time, the company was first acquired 100% by Mercedes, and there’s now this joint venture between Mercedes and BMW joining the mobility forces. For us, it’s not so different from dealing with traditional VCs or private equity firms. Because we are not directly embedded into these companies, we are still our own company, and our bot (or board?) happens to be consistent to two of the largest OEMs when it comes to car manufacturing in the world. So that definitely gives things a spin…in terms of how they look at mobility and how they look at the evolution of mobility. Also in terms of what it does to their own business, and why might it be very interesting for them to have a foot in the door on the new mobility stuff that’s going to change how cities will operate in the future. On the day-to-day, it’s not influencing as much. But in the greater scheme of things, from a perspective of stability, it’s quite interesting to shareholders like that.

Peggy Anne Salz: I was doing some reading, Thomas, I mean, talk about volume uplift. I’ve seen, in some cities, six X volume. So that is quite a change. What have you seen as a company, and what have you done to achieve the most significant uplift so far?

Thomas Zimmermann: So, at the moment, we are seeing 100% year-over-year growth. But also, the last years have been flawed a bit in terms of Corona and a quite suppressed mobility market. But if you look at the more recent addition through our platform of the new mobility types, including e-mopeds, e-scooters, e-bikes, and car-sharing, this is, on the one hand, coming from a smaller base, but it’s getting really, really good traction. So users are adopting that. We sometimes even see much more than six X growth because it’s basically building up. And people are using that, want to use that, really like the offering. Then there’s also some type of seasonality. Whether it be explaining and building the brand from a ride-hailing company to a true multi-mobility company. And then, obviously, we also incentivize users to try out the service because we truly think it makes sense to explain it. But you really feel the benefit once using it, and opening your app and really seeing, okay, the next scooter is there, regardless of which provider, because we’ve integrated all the big providers. So basically say, “Okay, the next scooter is there, the next car sharing is there. I don’t need to flip through five apps to find the nearest scooter or the nearest car.” And that’s good talking about it. But I think that the customer value proposition, you really feel when you try it, compared to how you have done it before. I’ve done it myself, flipping through car sharing. Okay, there’s the next car. Oh, no, there was one close. Oh, no, now it’s gone, right? So that’s kind of annoying.

John Koetsier: And then you walk ten blocks over there to get a scooter, and that one’s gone when you show up. Or you walk a couple blocks farther, and then you give up, and then you just take a bus.

Thomas Zimmermann: Exactly. And that all is basically fueling the growth to platform expansion, but also a bit of a suppressed market in the past. And now, it’s getting traction again, which is really nice to see.

Peggy Anne Salz: I mean, those volumes are impressive, but you’re not the only one out there. I was also just recently in Berlin, and I noticed a couple new kids on the block. We have Uber in Europe as well. We’ll, there’s Bolt, there’s Lyft, there’s others. How do you differentiate from others in this space?

Thomas Zimmermann: One of the core differentiators is that we are not putting our own assets on the street. We tried that, we built up a scooter company in the past, had our fair share of tryout, and learned that we are not an asset provider. You need to excel at supply chain management, at logistics, at maintenance. That’s not us. We are a platform. And therefore, we started integrating other providers. If you look at our platform now—and that is the main part of the differentiation at the moment—there is no other provider in Europe that offers the same broad spectrum of mobility. So that means we have all the big players: Tier, Dot Miles, Share Now, Sixth, you name it, right? So it’s all in there, and this is two components. On the one hand, we offer much more, and it’s always the next closest option because we have that huge supply. And even if some of the single providers ramp up their fleet massively, even if they have the largest scooter fleet in the city, if we are integrating number two and three, we have more supply automatically. So, the density of supply is definitely one differentiator. And with over 170,000 vehicles in Europe available to our customers at the moment, nobody is close to that. And then the second thing—and this goes a bit more into how do we also, with our purpose—changing, basically the future of cities and how we live in these cities, by that we don’t inject any new assets into the market. If a new player comes in and wants to ramp up their portfolio, they need to inject new assets, right? And then, in the long run, it might play out. But for the time being, I would say, in a lot of cities, there are enough assets. It’s the same as with private cars, there are enough cars. It’s more about the utilization, how much stand time do they have, and so on. So what we are doing, we are not adding any assets. We are utilizing what there is on the market, and making it just more accessible to our user base.

John Koetsier: I want to turn a little bit to performance marketing as well. You come from a gaming studio, it feels like, Peggy, we’re asking this question almost every couple of weeks now, where gaming studio marketing execs are getting poached, and they’re coming over to more traditional businesses or different businesses, different verticals. How is performance marketing different for you now?

Thomas Zimmermann: It’s not, like, in 2014, where performance marketing was basically eating a lot into the classical marketing budget. So it was right at the peak of performance marketing, everything trackable, huge volumes, high CLVs, good return was close to perfect, I would say.

John Koetsier: IDFA for everybody.

Thomas Zimmermann: Right. So, therefore I think from a time component, a lot of things changed in performance marketing. Well, just digital marketing, there are more advertisers in there and also the classical ones. So FMCG spend on digital platforms has increased, and so on. So, it has become more expensive. That’s the one thing. And I think the second thing is most likely everybody who’s in your audience knows that tracking has changed quite a lot. And then we are above the peak of just performance marketing is everything. And why that, I think, healthy understanding, then needs to be tied together also with classical marketing activities, brand activities, then the tracking site, which brings it even closer to these activities, brings us to a point where I’d say, it is more a combination of things and you need to look at it holistically. So, for example, we are at the moment implementing—which is rather old school— we are looking into marketing mix modeling because digital alone is not as trackable as it used to be. And there are also other big portions of spent, and we somehow need to bring that into balance, as we revert back to something that has been upgraded over the course of the years, luckily, but it’s rather classical approach. And then compared to gaming, I would say, the biggest difference is it’s a more indirect product to a certain extent. Meaning that with the game you register and then you play, but do I get you with the performance marketing app when you really need a cab because you also need to go through the registration process? So, there is a bit of a delay between the attention and then the desire, and then the actual usage. So, I think that is something different also in terms of how to monitor what’s the best first post or install KPI, for example. To really measure if you are a successful customer that differs a bit. And then it’s a marketplace business. Gaming is not a marketplace business. And while gaming was crazy, and it was a lot of countries and crazy scale, and the whole in game economics, oh, boy, the marketplace business is something else.

John Koetsier: That is a great explanation of what’s changed. Peggy, I smell another book there, “Post-Peak Performance Marketing.” I mean, that sounds like an interesting book to write, and an interesting topic to dive into. You are using new techniques, old techniques, in some cases, updated for modern times as well. But you’re also doing some influencer marketing you’re using WhatsApp for messaging. What are some of the new things that you’re doing that are working for you?

Thomas Zimmermann: It’s old things and new things trying around. What role does text messaging play, for example? That’s very efficient for driver marketing or for communication with existing drivers. Then, on both sides of the marketplace, newer messages like WhatsApp do play a role. You need to see what is the right communication channel for the audience. We don’t want to communicate to the user in any way where it feels intrusive or where they are annoyed. It’s more an evolution also of existing things. So you can say, I don’t know, TikTok or Snapchat is something new; for me, it’s not. It’s a new platform in the ecosystem. It’s like a new publisher that has been there before. Mechanics are different, but essentially, is not a completely new form of advertising. But it comes with challenges and differences, and also upside. So you need to really look into what’s working on that platform, as with any other platform, and then try out for that AB test and try to make it work. I think for a pure mobile-first company, like ours, it was really interesting when we first did TV or radio, or something like that, which is not new marketing stuff. But for a tech company, when you do that the first time after years of business, that is, kind of, new.

Peggy Anne Salz: So you’ve done old, new, we’re hearing about media mix, also, making certain, the messaging channels match the consumer. But if you step back and you say, “Okay, segment the customers because you need to make certain, the messaging matches their preferences.” You’re coming from mobile gaming, is it easier or harder than segmentation there?

Thomas Zimmermann: I think it’s harder because it’s more heterogeneous. Because if you look at mobile gaming, everything that is in regards to your segmentation, how you address the user, what you learn about the user is in the gaming ecosystem, right? And it’s not really relevant what you’re doing outside of it. Yes, for user personas and so on. But if you’re at the airport playing the game, at home, on your couch, playing the game, doesn’t really matter if it’s raining, if it’s weekday, weekend, all of that doesn’t matter. It matters how you behave in the game. What’s your pattern within the game? And then you look at your engagement metrics against that. If you look at a service like ours, we are just a convenience touchpoint to get from A to B. In a game, it’s entertainment, you’re trying to kill some time, switch off or something. Our touchpoint is when you need to get from A to B, and then our touchpoint is gone. So, for us, it’s really important, what day it is. What time of the day? Why are you using the app? How is the weather outside? How is your behavior generally in immobility? What kind of services do you use? And then combine all of that. So, it gets pretty multidimensional, but not within the app so much. We need to try to incorporate and learn about our customers, in which situations they are when they open the app.

Peggy Anne Salz: So, you’re looking for users at that moment of inspiration, that moment, when they need your convenience. What does an engaged user look like to you? What have they done? What are the metrics? What are the events that define them?

Thomas Zimmermann: I think, yeah, frequency of usage is definitely something, and then also, kind of, trips. If somebody only takes airport trips every three months, okay, then maybe go on vacation every three months and use this every three months. So it’s a bit of type of usage, for what things are they using it, and frequency. Then increasingly more important is cross-usage. Are you only ride-hailing or only scooter, right? Especially for older customers, like in terms of tenure with us, some of them are only ride-hailing. That’s where we are coming from. But then we see that actually users that use multiple types of transportation with us and switch back and forth and use all of them have a higher frequency, have more tools, are proactive users, and have a much higher CLV. So, obviously, for us it’s really important to basically expose them and tell them about what’s new in the app, and what you can now do with the app. Because if that resonates with them, then they are actually, for us, the most valuable users in the end.

John Koetsier: Now, I want to talk a little bit about your app. And you’ve already talked about personalizing user experiences, understanding users and who they are, where they go, when they use a service, what they use, those sorts of things. You offer so many different types of mobility. You mentioned it, car sharing, ride-hailing, moped, scooters. Sounds like a lot of fun. I want to use one of those. Maybe in Southern Europe, you know, in the nicer, sunnier, warmer places in Spain or something like that, how do you communicate that in your app and provide a personal experience with somebody who, you know, wants to get from A to B?

Thomas Zimmermann: It’s not only in the app. So there’s first, the whole outside-of-the-app advertising, where we explain the service and so on. But then, I would say, in the app, and extended to that, CRM measures. So push notification email is not directly in the app, but it’s. . .somehow you’re an active user, let’s say, active user communication, we really try to segment in a way, where we give users helpful and relevant information, not trying to get on their nerves too much. And this is not necessarily volume. I’m not annoyed by something if I get a high volume and it’s all relevant, or it’s all interesting, this is not annoying. That’s okay. Right. I’m getting annoyed if it’s irrelevant,and then it comes often. And if it only comes once a month and it’s irrelevant, you might not notice so much, but still might be irrelevant. So, for us, we are really trying to look into, okay, how is the usage? What can we make out of it, right? If you have often used scooters, we might send you a reminder if you suddenly stopped. But if you just have taken, I don’t know, 10 taxi trips, we would not necessarily send you a voucher to take your next taxi trip, right? Because this doesn’t really make sense. So, we are trying to put it a bit into usage and also trying then to. . .you have points of interest like airport, for example, right? So, it’s basically when you’re at the airport opening up the app, then you get walking directions to your pickup specifically to that location, we can only do that once you open the app, because we can’t do geofencing when it’s off, because otherwise we would be tracking you all the time, which is maybe not something you would like and definitely is not allowed. So it’s a bit, kind of, what can we learn about you in that very moment of time when you’re in the app, so then we can tailor specific messages or reminders. Or, for example, when you are in a cab ride to somewhere, we know because you are in that ride with us, your estimated time of arrival. So shortly before you arrive, you will get a push notification so that you don’t leave your bag or your phone or something in the car, right, to directly avoid any negative experience where you then have to call customer care or the driver, and they need to come back. And if you lose your phone, that also is tricky to do that then. So to do something like that, this is basically based on that.

Then we are also playing around with weather data a bit. So we’ve seen really good results when there’s good weather to be more active in communications, around scooters, bikes, mopeds, and stuff like that, to remind people that it’s nice out there and they can use these services with us as well. And there’s something like aspirational, where we want to learn enough about John, in that case, about your past mobility behavior that in the morning, when you use us for commute on Monday, we provide you different mobility options than on the weekend, where you go to dinner or something like that. So basically, giving you a personalized recommendation, what is the best to use. Maybe also on the distance that you need to take, the weather, how it is at the moment, where it’s raining cats and dogs, might be different. So that is stuff we are also looking into. But this is really personalized for you. Tap, in the beginning of the app is, at the moment, still aspirational.

John Koetsier: I really like that. Hey, it’s nice weather today, why not take the scooter? It’s going to suck today, you know what, take the cab.

Peggy Anne Salz: And it’s personalized. These are personalized recommendations, but they’re tacit, they’re not going to get, sort of, a strange, creepy feeling. This is going to be a convenient feeling. So that is a very smart move indeed. I guess that’s to increase frequency. Is it also to move the customers from one segment to another? Are you looking at that and saying, “Okay, I want to create that incentive, that they use it more, and go from one segment to another?”

Thomas Zimmermann: It’s about cross mobility usage. So if you have only used ride-hailing in the past, we try to motivate you also with incentives to try out new types because we think it’s beneficial. If you don’t react to that, like three times, five times, we will also stop bothering you. Obviously, not everybody needs all mobility types, but as I said, we see basically, the users that use across mobility types have the highest return rate, have the highest CLV. So therefore, for us, this is basically the goal: to have as many of our users as cross-type users, and not single-type users.

John Koetsier: Nice.

Peggy Anne Salz: So bigger buy-in, greater loyalty. Well, that is an impressive approach. You’ve also had an impressive track record as a CMO at Free Now, but also CMO at Good Game Studios. We discussed that. What skills experiences traits have helped you take Free Now to where it is today?

Thomas Zimmermann: All right, it’s not only on my shoulders, right? So, with every company, it’s a great team.

Peggy Anne Salz: I’m sorry, Thomas. I have to say that every time with the European interview, it’s not me, it’s the team, but you did bring some of the. . .

Thomas Zimmermann: It is a team. It is a team. The biggest task of every leadership person is to build a high performing team and remove roadblocks for them, right? I truly believe that. So, it is a team. And I think. . .but what helped me to build that team and to remove these roadblocks is I think. . .I mean, I’ve always worked in tech companies, right? And, yes, you learn something on the way, but I think it helps that tech in itself is not a black box for me. I would never say that I can code. My CTO always called me your script kitty. But, yeah, it’s literally that, right? Coming from SEO and affiliate marketing on desktop. So, you naturally play around with Python code, with PHP, and so on. I think I have a certain access to generally how engineers work and think. And then I have always been pretty heavy on the data site and then again, with data science. So, I have a really good understanding of what the core of our organization is doing. And even in the previous role as CMO, it helps a lot, if you are close enough to the data topics, because actually that fuels a lot of things. And then you can also ask the right questions. You do understand what works and what did not work or what cannot work, and also what you might be able to build. So having a certain affinity to data and tech in marketing nowadays is something really, really important. So, I think that plays a big role.

John Koetsier: I think that is super important. And I think also super important in making a transition from CMO to CEO is that mindset that you’re building a team, you’re building a team of the best possible people. You’re removing those roadblocks from them, and then you’re expecting the team to perform. So that makes a ton of sense. Maybe let’s end here, and ask what’s next for Free Now? Like, you’ve built a pretty impressive platform. You’ve got some good stats, some good numbers, some good growth. That’s great. You’re in Europe. Are you going to expand beyond there? Are you going to expand within Europe? What do you see as the next step?

Thomas Zimmermann: So, we’re not going to expand beyond Europe in the foreseeable future because the market potential and the problems to solve are still really big here. We really want to focus on Europe. Every other region in the world comes with different challenges. And, I think, Europe is diverse enough. So, I think going beyond Europe would de-focus a bit too much. But beside that, I would say we are still adding new partners. We are building out the multi mobility platform further. This is still ongoing. And then we talked a lot about B2C. This is also the biggest volume. But on the back of that, we have a really strong enterprise business. We had that already with rotating offering business accounts where you can administrate different things. It’s easy on the accounting side, and so on. This is also expanded by now the new types of mobility. And then, again, we are building up on our B2C business. Another enterprise business, which is a mobility budget, which, in the end, is employee benefits. So where your employer can say, “Okay, instead of giving you a car, you get 500,000 euros mobility budget per month in our app, and you can use it across all mobility types.” You can track it, it’s a nice visual, how much you have left? How much you spend on which mobility type and so on? And that actually builds. And, again, the enterprise counterpart to what we are doing on the B2C site. So, I would say this is this year, next year, and then, obviously, growing on these verticals, and then we will see what’s next. Because, as you mentioned, we are platform, and for us, what we are constantly thinking about is how can we leverage our platform best, and how can we build upon the services that we already have that are maybe not so easy to build from scratch for pure player or do something different because you don’t have user base, or the volume, or the tech team, or whatever. And there are multiple options, right? Some of them we are already seeing, and also with some of the competitors could be rapid delivery, food delivery, could go more into other segments of travel. So, we are not fully decided on what to do next because currently we are focusing on execution on the core. But definitely, if we are going to expand our services, it’s something where we can leverage our platform or user base.

John Koetsier: Well, I’m a little sad to hear that you’re not expanding North America because it sounds like a very cool platform, and I’m looking forward to using it at some point. Well, I just have to travel to Europe, clearly. But it is a really neat platform. And it’s also a really neat business idea and niche that you’re occupying because it, kind of. . .rather than occupying every niche, verticalizing everything, you’re taking a piece. And there’s pieces for other local players who can do the job better in local places that have different geography, weather, whatever regulation, that makes a ton of sense. Thomas, thank you so much for taking this time with us. It has been a real pleasure.

Thomas Zimmermann: Thank you very much. Thanks for having me.

Peggy Anne Salz: And Thomas, I have to thank you also for a little peek under the lid. Because in the platform, John, now think about the power of recommendations and if you can personalize them. So, it’s, cross-sell, it’s upsell, it’s something bigger than the sum of the parts. So, thanks again.

John Koetsier: And for our audience, if you’ve been watching the video, hey, we also publish this in an audio podcast, which is easy to consume on the go, on the train, in the plane, wherever you are. And if you happen to be on the audio version, you know what? You can see us, which is amazing, incredible for some of you, I guess. Search for us on YouTube to chill. Watch us whenever you want.

Peggy Anne Salz: This podcast is about finding the world’s best marketers and getting their top tips. And we focus on major brands with big stories to tell. So, if you fit the bill, DM John, or me on Twitter or LinkedIn, and we’ll set you up with a show of your own. Until then, this is Peggy Anne Salz.

John Koetsier: And this is John Koetsier for “CleverTap Engage.”

Mobile Marketing is Easier with Expert Guidance

Posted on August 16, 2022