Conventional fixed-structure transit service is unable to satisfy the increasingly personalized passenger demand. Shared mobility companies enable the transformation of conventional transit with advanced technology. This paper proposes a framework to design an application-based demand responsive transit (DRT) system to serve zone-to-zone passenger requests. The proposed DRT service operates between zone pairs to satisfy “door-to-door” and “reservation-based” requests. A two-phase problem is formulated, including (i) conceptual planning phase and (ii) discrete route design phase. In the conceptual planning phase, a continuous approximation model is proposed to optimize operational efficiency by deciding the resource requirements and operational features with given service area and demand density. In the route design phase, a customized bus routing model is established to generate profitable routes, by adopting a combined solution approach with adapted savings and simulated annealing (SA) method. The theoretical framework is applied in a pilot area at Huangdao College Town in Qingdao, China. An implementable design including the layout plan, candidate stops, and operation headways is developed from the conceptual plan model. Groups of sample data sets are used to demonstrate the applicability of the proposed design framework. Results show that the proposed DRT system is promising in relation to providing better service than the previous first-come-first-serve bus pooling service.