How does redBus makes Money | Business model of redBus

Pratyusha Srivastava Pratyusha Srivastava
Jul 12, 2021 5 min read
How does redBus makes Money | Business model of redBus

It rarely happens that an app is developed to help the life of a common man. There are very few such services developed in our country and on that note, redBus is known by every soul of a common man. The company was built to help us book bus tickets conveniently from our home without waiting at the long bus ticket counter.

Earlier, booking bus tickets from our comfort zone was almost a fantasy. But, redBus made this long-awaiting fancy true in 2006. And thanks to redBus, now we can book a bus ticket from anywhere and travel any part of India, conveniently. Also, it offers the best authentic services to its customers.

redBus has been received very promptly by the Indians. Indian being the 7-largest contributor to the world's GDP, aims to take the travel and tourism industry to a next level of success worth USD 48 billion.

However, earlier there were not many facilities and options available for the traveller for a comfortable ride, especially the bus services. But, companies like redBus putting their immense contribution towards making the journey of travellers very convenient and safe. RedBus has truly made bus travelling very easy. And its contribution has taken the travel and tourism industry to great extent.

About redBus
Where does redBus operate?
Key Services of redBus
Target Audience of redBus
Business Model of redBus
What is so unique about the business model of redBus?
How does redBus makes money?
FAQ

About redBus

In the early 2000s, a very brilliant and people-serving idea came to the mind of Phanindra Sharma when he was looking for a bus on his way back home. He was facing a very difficult time finding one, but then he went to find a solution for this. He learned about a mismanaged system that worked among the bus operators. This gave him the brilliant idea to develop the most reliable people-serving service, redBus.

Phanindra Sama along with his batchmates Charan Padmaraju and Sudakar Pasupunuri from BITS Pilani developed this idea into a well-successful company. Later in 2006, redBus was founded in Bengaluru, India.

For better guidance, they joined the TiE Entrepreneurship acceleration programme where they got the guidance of great mentors. redBus was the first of its kind and no doubt, it came out radiantly. Today, redBus sells more than 5000 tickets per day.

Where does redBus operate?

redBus provides great customer's service and receives great benefits from its sales. The company offers the most superior advantages to its customers at the best reasonable pricing.

Till now, redBus has served more than 18 million people across the world. Outside India, redBus also has a strong foothold in countries like Colombia, Peru, Malaysia and Singapore.


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Key Services of redBus

redBus is the leading bus ticket company which offers a great fraction of services to its customers, services that you can't deny but choose redBus. And to this result, redBus has millions of happy and loyal customers across the globe.

Most priorly, redBus offers an absolutely secured and manageable experience of booking tickets online. Moreover, it offers complete choices to the customers such as choosing their destination, preferred seating options and booking the ticketing effortlessly.

Target Audience of redBus

redBus mainly targets the literate middle-class people across the country who are truly reliable on internet services and get to travel a lot.

However, in the beginning, redBus main target was to get as many bus operators as possible. But their idea was rejected by the bus operators because they were well in their comfort zone of conventional methods. Then, the founders went for the customer's pool to drive more travellers' traffic towards their website. This was a great success and the company experienced a massive growth graph.

Business Model of redBus

redBus is known as the largest online bus ticket booking website across India. More than 5000 tickets are booked every day. The website has over 700 bus operators along with 10,000 bus lists. The business model of Redbus is very strong along with its digital marketing strategies. Redbus is widely welcomed on social media with great enthusiasm.

The company often arranges several offerings for its customers on several occasions and provides free tickets to the winner of their contests on social media. Also, it provides discount offers.

Multiple marketing strategies are adopted by redBus which results in promising customers responses. redBus provides hotel services along with ticket booking. It offers great deals on various occasions and some special discount offers as well. But, the most advantageous factor that comes on redBus is that it provides the customer with the opportunity to choose the most favourable route to their destination.

What is so unique about the business model of redBus?

The most fascinating and unique thing about the business model of redBus is that it provides the customer with the opportunity to choose the most favourable route to their destination.

Its business model is entirely based on its affection towards the customers. redBus devotes tons of different offers to its customers to get better customer engagements.

Meanwhile, its social media strategies are designed so well that it always finds great proposals for its audiences. Its approach to social media is quite different from others. It mostly keens on promotion but that too, on customers demands and favours.


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How does redBus makes money?

redBus makes its money from the simplest manner of work. It charges some fee as commission from the bus operators on each booked ticket on redBus. The commission comes as 20-40% of the total ticket value.

The founders started the company with an amount of Rs. 500,000 from their savings. When the company was built, it didn't make any profit in the first year but in 2008, it received a great deal of success with a turnover worth INR 5 crore. Then in 2006, redBus profit grew by 6 times of its last.

And now, redBus has over 2 crore users from 24 states, 30,000+ outlets along 80,000 routes and 2300 bus operators. And known as the largest online bus tick company.

Conclusion

redBus has had enormous success since its launch in 2006. There are tons of bus services available 24×7 and meets all the needs of the traveller. Its business model is quite simple and strong but most importantly, redBus is wildly famous and welcomed among the common people.

As it eases its major issue with finding a fine bus for any destination. It's one step closer to fulfilling every need of a traveller along with its destination requirements. redBus was one of its kind and it's a true inspiration for developing services for the betterment of common people.

FAQ

Who is the founder of redBus?

Phanindra Sama, Charan Padmaraju, and Sudhakar Pasupunuri founded redBus on August, 2006.

Is redBus acquired by ibibo?

Yes, redBus was sold to ibibo for $138 million.

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