Summits Yellow

Route Masters – Waze talks mapping and monetisation

David Murphy

David Murphy talks to Finlay Clark, UK country manager at Waze, about the company's community-based approach to navigation, ahead of Clark's presentation at the Mobile Marketing Travel Summit later this month.

Living just outside London, it’s easy to assume that for most people, the morning commute involves getting on a crowded train and hoping for a seat. In fact, however, according to the 2011 Census, 57.5 per cent of the workforce in England and Wales gets to work every day by car (compared to just 16.4 per cent by public transport), and it’s these everyday, motoring commuters that the satnav app Waze, aims to help.

“The difference with Waze is that all the information that feeds into the app is crowdsourced from a community of real drivers who see the traffic hotspots and route you round them,” explains Waze UK country manager, Finlay Clark. “It’s for regular drivers on the same commute, telling them the optimal route on any given day.”

The app is available globally, for iOS and Android, though Clark concedes that it works best in countries where there are more users. Top countries right now are the US, France, Brazil, Malaysia and Mexico. The UK is growing fast, with user numbers here doubling in the last year. And, says Clark, the app sees huge engagement. “In March, we saw an average of over 14 hours per month usage in the UK,” he says. “There are very few apps outside of Facebook that see that much engagement, but it’s because we are like this co-pilot getting you from A to B.”

Community mapping
The idea for Waze was born when founder and CTO Ehud Shabtai noticed that a digital map of Israel contained lots of errors and wanted to set about correcting them. But the mapping company didn’t want him messing with its map, so instead he set about recreating the map with the help of the community.

As Waze morphed into a satnav app, gamification elements were introduced. The user’s car was depicted as a Pacman character gobbling up the roads. Then virtual cupcakes were placed on the map. As cars passed over these, it enabled Waze to see how long it had taken to get from one to the next, and so gauge the car’s speed, a good indicator of traffic conditions.

Waze’s novel approach to mapping and navigation caught the eye of bigger companies. There were rumours that Facebook was interested in buying the firm, but in March 2013, it was Google who acquired Waze for $1.15bn (£920m). This was an interesting move given that Google already had Google Maps, which is in itself no slouch on the satnav front, offering the sort of real-time traffic updates that dedicated satnav systems used to charge a subscription for. Clark explains it thus: “Google Maps is for everything, but if you drive a lot, you will see the benefits of using an app like Waze.”

Data sources
Waze is powered by two main data sources. First, the company liaises with transport authorities to find out what road works are planned for when, and how big events, like the London Marathon Sunday week, will impact the flow of traffic.

The second source, and what Clark says really sets Waze apart, is its community of almost 70m drivers around the world, who contribute to the accuracy and utility of the Waze satnav experience in a number of ways.

“There are different layers of community,” Clark explains. “If you drive with the app on, you passively share your GPS traces, which gives us average speeds. You can also give us reports on traffic jams and accidents. And then we have the map editors, hundreds and thousands of ‘super users’ who make constant edits of the maps. Maps are dynamic, they change every day; these people make sure we are not the app that takes you down the bridge that’s closed. We see traffic as a big problem that costs both the economy and the environment. The Waze community plays its part in helping to alleviate it.”

It’s commendable, for sure, but what’s their motivation for doing it? “The super users do it for altruism, like other people do sport or crochet,” says Clark. “It gives them a degree of status within the Waze community, and there’s also a gamification element to it where we can reward them with points, which give them extra status and the right to choose their own unique icons on the maps.”

Waze is a free app, which naturally begs the question of how it makes money. The answer, unsurprisingly perhaps, is advertising.

“We’re never going to charge for Waze; it’s one of the best satnavs and it’s free so in return we occasionally put ads in the app, giving brands a chance to intercept before, during and after the drive, using ad units that are native to the form and function of a map like branded pins,” says Clark. “These are really popular with shops and restaurants to let people know where they are.”

A second ad unit called ‘Takeover’ kicks in when drivers are stopped at a red light and may glance at the phone’s screen to check the route. The branding occupies the top half of the phone’s screen, overlaid on the map, with calls to action including ‘Drive there’ and ‘Save location’. But advertising on phones being used by drivers is clearly a sensitive issue, and Clark is keen to stress that the user experience, and safety, are key considerations.

“A driver will only see one or two of these in a journey and it disappears as soon as they start moving,” he says. “Clients and advertisers want to spend more on mobile but they don’t all necessarily want to do programmatic banners, so these are high impact, geotargeted ads that enable them to reach people at a time when previously brands did not have a chance to engage with them.

“The interesting thing is that advertisers come on board and they test and they renew. We get renewal rates of 80 per cent, so we find that ads on maps are working, when for a long time, ads on maps were not really looked at. And the money we make from advertising funds the innovation we are working on elsewhere.”

Transportation on demand
A key strand of this innovation program – a car pooling service being trialled in the US and Israel – offers a clue to how Waze might evolve in the future. The pilot has been running for 18 months in Israel, 12 months in the US, with Brazil next on the roadmap, later this year.

“Looking ahead, we see ourselves as a transportation on demand service, and car pooling is a key part of that,” says Clark. “Car pooling has been around for decades but it hasn’t really taken off because it seems like a lot of hassle for not much reward. But we have almost 70m people driving with our app on, so if we can convince some of them to take someone else with them, it will have an effect on traffic, time and money.

“In London, you are conditioned to pull out your phone and a car turns up, but other countries don’t have that and we want to become a solution to that for regular commutes. If we can get cars off the road by having people share seats, that’s a good thing, and one benefit of being a Google company is that we can try and get the user proposition right.

“You can only load balance and optimise so much. There are too many cars on the roads, so you have to ask how do we take some of them off the road? We have a long way to go but that is one of the bets we are making and we are learning a hell of a lot from these pilots.”

Finally, says Clark, Waze see great value in partnerships, not just data partnerships with transport authorities, but partnerships with other app developers where there is a logic to partnering. He points to a recent tie-up with Spotify on the Android version of the Waze app as a good example of the company’s thinking.

“The Spotify partnership was announced in March, but it’s not something that happened in weeks,” he says. “It took a year and lot of work linking our SDK with theirs, but it’s a good example of what app developers can do when they look at the use cases and you see two apps, one for music, one for navigation, that you would want to have running concurrently.

“We understand that it’s a sensitive topic so it’s designed so that your playlists are there from the start; you just tap a button and drive and you have your playlists. I think it sends a message to other app developers that when you’re on a small screen, you need to be clever about how you run more apps.”

Finlay Clark will be talking about Waze’s past, present and future at the Mobile Marketing Travel Summit in London on 27 April. You can register to attend the event here.