How traditional taxi services can win over Generation Z
Updated: Nov 3
Generation Z, born into the age of smartphones and digital services, have grown up expecting convenience and transparency. This generation has been drawn to ride-hailing services such as Uber and Bolt, which offer glossy modern marketing, upfront pricing, and a booking process through their mobile device. For many youngsters, traditional taxis are seen as an outdated alternative, largely due to their perceived reliance on street-hailing or phone bookings, and fare structures that can feel unclear and unpredictable.
While cost is a driving factor for Gen Z when choosing transport, their preferences evolve as they move through life stages. As incomes increase and responsibilities grow, concerns about comfort, safety, and reliability become just as important as price. This has long presented an opportunity for the traditional taxi industry to reposition itself to appeal more directly to what was once their younger audience.
Digital integration: Meeting Gen Z where they are
For taxis to gain ground with Generation Z, digital integration is essential. Ride-hailing apps like Uber have set the standard, offering a streamlined user experience that makes booking a ride, tracking the vehicle, and paying for the journey fast and efficient. Traditional taxis have followed suit and, in some markets, even lead by adopting similar technology.
Many local taxi firms have already begun to introduce their own apps, allowing passengers to book and pay through their phones, but with much lower marketing spend it is difficult reaching Gen Z.
Taxi apps need to match the level of user experience provided by their high budget ride-hailing competitors. This includes features such as real-time tracking, instant fare quotes, and options for digital payments. Without these modern conveniences, traditional taxis will struggle to compete for the attention of tech-savvy young travellers.
Pricing transparency: Eliminating uncertainty
One of the reasons younger generations have gravitated towards ride-hailing apps is the transparency they offer around pricing. Passengers know the cost of their journey upfront, which removes the uncertainty associated with metered taxis. Traditional taxis could bridge this gap by implementing more transparent pricing systems, such as fixed rates for common routes or fare estimates provided through their apps.
While the metered system has long been a hallmark of the taxi industry, younger customers value the ability to plan their budgets and avoid surprises. By offering clearer and more predictable pricing structures, taxis could become a more attractive option for those who prioritise cost certainty over saving every possible penny. That said, a regulated meter offers security against surge charging models and is often over-looked.
Sustainability: Appealing to eco-conscious travellers
Sustainability is a key concern for Generation Z. This group is more environmentally aware than previous generations, and their purchasing decisions often reflect a desire to support eco-friendly businesses. Ride-hailing services have recognised this trend, with some offering electric vehicle options or promoting their sustainability efforts.
Traditional taxis can take advantage of this by expanding their use of hybrid and electric vehicles, positioning themselves as a greener alternative. In London, the move towards electrifying the black cab fleet is already underway, but more could be done across the UK. Highlighting the environmental benefits of choosing a taxi, particularly when compared to older, petrol- powered vehicles used by some ride-hailing services, could help win over eco-conscious Gen Z passengers.
Safety and professionalism: Building trust with young passengers
While cost and convenience are important, safety is a top priority for young people, particularly those travelling alone or late at night. Traditional taxis have long been subject to strict regulations around driver vetting, vehicle inspections, and operational standards. This gives them an advantage over ride-hailing platforms, where there have been ongoing worries about inconsistent driver vetting and safety protocols.
The taxi industry could better promote its strong safety record, emphasising the rigorous checks that drivers undergo and the professionalism of licensed taxi operators. This message could resonate particularly well with female Gen Z travellers, many of whom may have had negative experiences or safety concerns with ride-hailing services.
Payment options: Embracing the cashless trend
Generation Z is largely cash-averse, preferring the convenience of digital and contactless payments. While most traditional taxis now accept card payments, they need to go further to meet the expectations of younger customers. Offering a wide range of payment options, including mobile wallets like Apple Pay, Google Pay, and PayPal, as well as in-app payments, is essential.
Cashless payments not only make the customer experience smoother but also reduce friction in the booking process. The ability to pay through an app or instantly via contactless methods aligns with Gen Z’s demand for a hassle-free, modern transport experience.
Loyalty and discounts: Adding value for cost-conscious passengers
Ride-hailing services have successfully captured a significant portion of the Gen Z market by offering promotions, referral codes, and loyalty schemes. These incentives provide value for budget-conscious travellers, who are always on the lookout for ways to reduce costs.
Traditional taxis could introduce similar schemes, offering discounts on frequent journeys, special rates for students, or promotional offers during off-peak hours. By rewarding loyalty and offering competitive pricing, taxis can compete more effectively with ride-hailing platforms on price, without sacrificing service quality.
Targeted marketing: Reaching Gen Z where they live
To truly capture the attention of Generation Z, the traditional taxi industry needs to rethink its marketing strategy. Ride-hailing platforms have heavily invested in digital marketing, engaging with younger audiences on social media platforms like Instagram, TikTok, and YouTube. Taxi firms need to do the same.
Developing targeted campaigns that highlight the benefits of traditional taxis—such as safety, professionalism, and sustainability—could help shift the perception of the industry among younger audiences. Influencer partnerships, social media campaigns, and online advertisements that speak directly to Gen Z’s concerns could raise the profile of taxis and reframe them as a modern, reliable, and eco-friendly alternative to ride-hailing apps.
The way forward for traditional taxis
For traditional taxis to win a larger share of the Generation Z market, they must modernise marketing and booking features while leveraging their existing strengths. Digital integration, pricing transparency, and embracing sustainable practices are essential steps to staying relevant in an increasingly competitive transport landscape.
While the battle for Gen Z’s travel preferences is still largely being won by ride-hailing platforms, history has shown that the younger generation have always arrived on the taxi market further down the line.
However, with the right approach, taxis can also position themselves as a credible, modern choice for a new generation of passengers and take a piece of the Gen Z pie.
