The document discusses digital disruption and its impact on traditional business models, particularly focusing on Uber as a case study. Uber connects passengers with drivers through a smartphone app, providing various ride options while facing regulatory challenges and public protests. The company also offers services like UberEats and has encountered setbacks in several countries due to legal and safety concerns.

1. Digital disruption is the change that occurs when new digital
technologies and business models affect the value proposition of
existing goods and services.

2. Innovation and Disruption

3. The worlds most popular media
owner creates no content
The most valuable retailer has no
inventory
The world’s largest accommodation
provider owns no real estate.
Largest telecommunication company
owns no infrastructure
Fastest growing banks have no actual
money
Independent Software vendors do
not write any code 3

4. 4
IN 2015, THE WORLD’S
LARGEST TAXI COMPANY
OWNS NO VEHICLES?

5. [Personal Transportation Industry - TAXI]
License Fare
Taxi supply Regulations
Protective! Costly! No invest!
Gov. Taxi Firm
Low customer satisfaction

6. A study on modern age Business
strategy
Dhruvajyoti Roy

7. What is the
concept behind
Uber?

9. Someone who needs a personal drive from any point at any time

10. Someone who wants to have a side business, or a full-time business,
or a revenue generation hobby by driving people for money

11. UBER connects these two needs
in simple, fast, and predictable way

12. Uber is a Carpool & Taxi Assistance venture with main office in San Francisco, California,
and operating in several countries.
By 2015, service was accessible in 58 countries & more than 300 towns
worldwide, estimated more than US$68 billion in December 2015.
Uber is subject of current protests from taxi drivers, taxi houses & elective bodies
with belief that carpool companies are illegal that occupy unfair trade executions &
imperil passenger security.
In December 2014, demonstration has been staged in Germany, India,
Thailand, Spain, France, & England, among other nations, for disturbances
implying riders.
Uber was prohibited in Spain & two towns of India in December 2014, and pursues
to find solutions with many governmental bodies, plus those of U.S. & Australia.
Image curtsey - http://onwardstate.com/wp-content/uploads/2014/09/o-UBER-

14. UBER
Marketing Strategy

15. Customer Segmentation
Do not own a car.
Do not want to
drive themselves
to a party or
function.
Like to travel in
style and want to
be treated as a VIP.
Want a cost-
efficient cab at
their doorstep.
Partner drivers.

16. Targeting
Uber has such a vast customer segment that it has got something on offer for everyone. From Uber Taxis
to Uber Black and from Uber X to Uber SUV, the company has got a vast range for its customers to make a
choice.
Uber serves professionals as they hire an Uber cab to and fro work. For this Uber did few tie-ups with
corporates in the beginning and does so when it launches in a new city in a new country. Apart from
professionals, Uber tries to touch hearts of people by offering special services like:
Uber for Kids: A special service from Uber dedicated for parents who want their kids to reach home from
school in an Uber cab.
Uber for Senior Citizens: Another special service from Uber where it targets senior citizens. As per the
statistics, Senior citizens make for upto 30% to 40% of total rides in many cities. This made Uber have
some special features for seniors and hence attract more senior citizens on the platform.

17. UBER existing product lines
Positioning

18. • UberX
• UberXL
• Taxi
• Black
• SUV
• Lux
• UberCargo
• UberFresh
Product Lines

19. Uber product lines
UberX, the low-budget option.
UberBLACK is for consumers who desire to have their own private driver in a high-end sedan.
UberSUV connects users with SUVs
UberLUX is the most expensive service with luxury vehicles
UberXL is similar to UberSUV but is 50 percent less
Other low-cost options include UberPool, which allows passengers to share rides and split the costs, and UberPOP, a service costing
less than UberX because it utilizes non-professional drivers and smaller cars. Despite the opportunities UberPOP provides, its use of
non-professional drivers have led to regulatory issues in different countries.
UberFRESH and UberEATS are meal delivery apps that partner with local restaurants to offer meals to consumers within 10 minutes.
These new services are allowing Uber to branch out and expand its services into different businesses.

21. UberCARGO , Piloted in Hong
Kong is the next market Uber
plans to capture

24. Areas where UBER plans to disrupt!!
Number of Customers (Demand) The Stability of Demand Organized Competition
Luxury Transportation Low (-) Stable (+) Low (+)
Mass Transportation Medium (+) Unstable (-) High (-)
Delivery Logistics High (++) Stable (+) High (-)
Home Services High (++) Stable (+) Low (+)

25. How UBER works?
Operations Strategy

26. Provides What Customer Wants
Reliable
Customers get a cab
within minutes
Ease of
use
Easy to operate
application
Affordab
le
uberX at least 10%
cheaper than a Taxi

27. How it works
Uber's rates are alike to metered cabs, and entire lease & remittance is administered
through Uber.
Uber uses a smartphone application to accept ride requests, & then redirects these trip
applications to their chauffeurs.
Travelers use the app to demand rides & track the reserved automobile’s position.
In some towns, if Uber cab is travelling at more than 11 mph (18 km/h), then the
payment is decided upon distance, else the price is decided upon time basis.
On reaching the destination, the entire fare is automatically billed to the customer's
credit card.
Uber has categorized its high prices as premium being paid by the travelers as its
service is reliable, punctual as well as comfortable.
During festival season such as Halloween, New Year's Eve, or severe weather
conditions, Uber reserves rights to increase its prices, alluring more business.

28. GPS
RIDE
80% of Fare
20% of Fare

29. • Easy to start
(no license)
• Individual business
(have full control)
• Earn more than taxi
(simple cost structure)
[Incentive to join the network]
Dynamic Pricing Model
(stably balancing quantity of
demand & supply)
• Easy to use
(thru smartphone app)
• Reliable
(arrival time & Fare)
• Cheaper than taxi
(simple cost structure)
• Better quality
(ratings & feedback)

30. UBER’s Financial Strategy

31. Feb, 2016 $200M / Private Equity — LetterOne
Jan, 2016 $2B / Private Equity — —
Sep, 2015 $1.2B / Private Equity — Baidu
Aug, 2015 $100M / Private Equity — —
Jul, 2015 $1B / Series F — —
Feb, 2015 $1B / Series E — —
Jan, 2015 $1.6B / Debt Financing — —
Dec, 2014 $600M / Series E — —
Dec, 2014 $1.2B / Series E $40B —
Jun, 2014 $1.2B / Series D $18.2B Fidelity Investments
Aug, 2013 $258M / Series C $3.5B GV
Dec, 2011 $37M / Series B — Menlo Ventures
Feb, 2011 $11M / Series A $60M Benchmark
Oct, 2010 $1.25M / Angel — First Round
Aug, 2009 $200k / Seed — —
History : 2009–2011 - Establishment in the U.S. and Venture funding

33. 4. UBER’s International Strategy

34. Global Multi Domestic
UBER services are available in 58+ countries and 300+ cities around the world
• Govt. regulations
• Communication infrastructure
• Cultural adaptation
• Organizational structure
• The transferability and sustainability of
the technology & information systems
(Navigation system, apps, telematics)
• A very well positioned and easy-to-
recognize brand
UBER

36. Five Forces Analysis

37. Threat of new entrants
Threat of substitutes
Suppliers’ power Buyers’ power
Intensity of rivalry
BARRIERS TO ENTRY: MEDIUM-HIGH
Government policy
UBER’s strong brand identity
UBER first mover advantage
RIVALRY DETERMINANTS:HIGH
Large number of firms
Fast market growth
(industry in apps segment)
Similar cost structure
Low switching cost
Low diversity within rivals
DETERMINANTS OF BUYER POWER: HIGH
Many substitute available
Switching cost is cheap
DETERMINANTS OF SUBSTITUTES THREAT : HIGH
High buyer inclination to substitute
(Strong public transportation system/taxi/car-sharing…)
Price elasticity is high
[DRIVER] DETERMINANTS of SUPPLIER POWER: LOW
Many competitive suppliers
Low bargaining power
Low impact of input on cost
[Others] DETERMINANTS of SUPPLIER POWER: MED
Navigation or Background check companies
[Porter’s five forces analysis]

38. • Lyft
• Gett
• Taxi drivers
• Sabotage
Global Competition

39. Challenges

40. [Three big challenges & Group suggestions]
Regulations1 Imitators2 New Technology3
Challenges
• Current law systems says
UBER is illegal in most
cities (No licensed drivers)
• Total or partial prohibition
of the services and
advertising, fines,
confiscations of cars and
other penalties
• Basically anyone with a
car and a driver’s license
could be a competitor
• There are many
companies operating in
very similar ways as UBER
(e.g. LYFT and Sidecar)
• New disruptive
technology
• New business model
• Driverless cars
Suggestions
• Establishing better and
earlier relationships with
government
• Pushing drivers to obtain
such permits by
themselves
• “Too big to fail” strategy
• Reinforce safety system
& Improve PR
• Lock-in strategy through
Google synergy (e.g.
maps)
& UBER brand synergy
• Retain critical mass and
achieve economy of
scale
• Leverage big data
• Partnership/Acquisition
of technology
companies
(Leverage Google)
• Invest R&D

41. Recent Setbacks
4
3
2
1
Thailand announced Uber illegal. Regulatory
obstacles were slammed in Germany, Netherlands &
San Francisco, where a chauffeur has been imposed
in a mishap leading to the demise of a six-year-old
girl.
Judge in Spain prohibited Uber's
carpool on Tuesday, 9th December
2014, stating it breached laws.
On 9th December 2014, San
Francisco & Los Angeles formally
summoned Uber for deceiving users
about charges & background checks.
Monday, 8th December 2014, city
government in New Delhi prohibited Uber to
function in the Indian capital after a rider
charged one of its chauffeur of rape.

42. Recent Setbacks
An Uber driver in San
Francisco has been
accused with vehicular
killing of a six-year-old
girl in San Francisco
on New Year's Eve in
2013, last year.
An Uber driver in
Orlando was charged of
molesting a female
traveler and holding the
woman’s dressing
accountable.
In September 2014,
an Uber driver was
charged of hitting a
traveler in the head
with a hammer and
drove away.
During the week of
December 9, 2014, a
Dutch court ruled
Uber system as illegal
stating non-
professional
chauffeurs offer trips
in their personal cars
at half the price of a
regular cab.
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