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Uber - Business Model Canvas

Uber, founded in 2009 and headquartered in San Francisco, is a leading ride-sharing platform that disrupted the traditional taxi market by allowing car owners to earn income as drivers. Despite its popularity, Uber faces challenges including fierce competition, a lack of customer loyalty, and reputational issues affecting driver relations. To maintain its market position, it must enhance marketing consistency, improve driver relationships, and focus on goodwill during crises.

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Entrepreneurship and Innovation. CEO : Dara Khosrowshahi  Year founded : 2009  Headquarter : San Francisco, California, USA
TEAM MEMBERS MBA SEPTEMBER 2019 KAMLESH BHOOPAL SID- 1919077 FARAZ ANSARI SID- 1840097 SATHYASHREE VENUR JAIN SID- 1838278 DIVYA AGARWAL SID- 1931570 TOM MATHEW SID- 1836888
Uber has gained major popularity in 2011 when Kalanick started providing iPhones with preloaded uber applications INTRODUCTION Uber is a multinational ride sharing company, founded by two friends in 2009. Every city had two or three taxi companies, because of the way they operated they could not scale beyond a limited geographical area but Uber changed all that.(Oakley, 2020) Uber's technology disrupted the taxi market by allowing people with cars and spare times to drive people who don’t want to drive and make an extra income (Cramer, Judd, and Alan B. Krueger, 2016). KEY IN-APP FUNCTIONALITIES Travis KalanickGarrett Camp BE YOUR OWN BOSS
Car owners who want to make money. People who love to drive and want to make it their profession. DRIVERS Those who do not own a car. Those who cannot drive or want to be driven around. PASSENGER CUSTOMER SEGMENTATION
PASSENGER VALUE PROPOSITION DRIVERS Additional Source of Income. Ease of getting started. Flexible working hours (BYOB). Driver Reward Programs Fast pick up. Easy and convenient transactions. Rating System. Tracking and Sharing.
Social Media/ online chalnnels (website) Word of Mouth Television and Media Ads/ Referrels Local Campaigns CHANNELS
CUSTOMER RELATIONSHIP Review, Rating & Feedback System Social Media Customer Support
REVENUE STREAMS NET ADJUSTED REVENUE $12.5 billion GAAP REVENUE 2019 $14 billion NET LOSS $8.5 billionRevenue Model -Transaction Fees Cost Savings to Taxis -Asset capital cost -No Licence Fees (Uber Technologies, Inc. - Investor Relations | Uber, 2020)
KEYRESOURCES Network (Drivers/Riders) Uber Platforms Pricing Algorithm Uber takes commission of 20% of the total fare and 80% is given to the driver. UBER HAS BEEN KEEN ON MAINTAINING THEIR BRAND IMAGE. Routing Algorithm Tech Talent and Data Analysis
UBER DISCOUNT COUPONS KEY ACTIVITIES REFERRAL PROGRAM LOYALTY PROGRAM Uber must reduce or eliminate subsidiaries to cope up with cut throat competition. Since uber a better know brand with a bigger Market share it will find easier than most of its competitors to attract its customers through loyalty programs. Uber's has integrated its referral program into both their web and mobile apps. Customers can either share a referral link or a referral code. Uber lets their customers to personalize their referral code. As new customers it is possible to pick up Uber discount code, as well as an Uber promo code if you allow push notifications/communications on your phone from the company.  Uber for business customers can also get Uber vouchers to save money on their transportation services.
All the relationships that Uber has with other business, governmental, or non-consumer entities that helps Uber's business model work. KEY PARTNERS Drivers Investors Supporters / Well wishers Financing / Insurance companies Technology Providers Payment Providers (Rauch and Schleicher, 2020)
Cost of revenue is the total cost of production , distribution of product or service to a customer. Uber's biggest cost  of revenue which includes, insurance costs related to ride-hailing, incentives paid to drivers, and costs incurred with carriers for the Uber Freight trucking platform (Griswold, 2020). In 2018, Uber spent $5.6 billion, or 50% of its revenue. COST OF REVENUE - Customer Acquisition Cost - Legal and settlement Cost - Research and Development Cost/ Technology Cost - Lobbing Cost / Support System Cost . COST STRUCTURE (Rogers, 2020)
SWOT Analysis UBER TECHNOLOGIES, INC. Recognized brand. Track and choose highly rated drivers. Working on algorithms helps get lower prices than traditional taxis. High standard of service. Verified drivers and cars. Operational cost is quiet low(As it relies on customer-to-driver interaction, a dispatcher is not needed). Strengths Expansion in suburbs where cab service isn’t available. Exploitation of newer and bigger markets where taxi services are inconvenient and expensive. Additional services like transporting older patients to hospital and transporting children to school or pick up and drop service of any item from one place to another. Opportunities Easily copied Idea. Competitors with same product. Very unpredictable business model Ethically questionable relationship between the driver and the company. Lacks the physical connection, thereby diminishing the loyalty of drivers towards the company. Privacy concerns within the application. Weaknesses Legal regulations in some countries will ban Uber from operating. Fines by local authorities can be a problem. Thereby earning bad public image. Increasing competition may lead to decreasing prices. Thus, resulting in loss of customers. Increase in frauds and scandals as new markets and drivers are joins. Threats S W O T
Problems Uber can’t keep up with cutthroat competition overseas. Southeast Asia accounts for more than 70% of the global ride-sharing market and uber isn’t the most used app here (McBride, 2020). Uber customers don’t care about Uber… Since there is no customer loyalty in the business Since the customer would always want a cheaper ride there is no loyalty to the company as ubers pricing fluctuates as per their algorithms depending on the time and the demand factors. Days before Uber’s IPO, Uber drivers boycotted the company and turned off the app clearly stating uber does not care about the employees This clearly shows that the uber drivers clearly had a rift with the company (Berger and Thor, 2018). Inconsistent Marketing Strategy The social media pages of uber are not updated consistantly and hence fails to communicate with the customer through major social platforms. Poor customer service The customer cannot contact the driver after the ride is completed in case they have forgotten something in the cab.
01 Consistant marketing strategy The social media pages of Uber must be engaged regularly and updated on a timely basis. Maintaining a dedicated team is recommended. 04 Employer and employee Transparancy Since the revolution start at home thus, uber needs to reform its toxic culture which has been questioned by alot of employees, their by creating more transparency between employer and employee. (WEISSMAN, 2020) 05 Uber cant keep up with the competition Uber should stop trying to be a service which is found everywhere. Since South Asian Market is already dominated by the Regional Companies it would be resolute for uber to engage in the price war ,when the company is already losing alot of money . RECOMMENDATIONS 02 Focus on Goodwill marketing Uber showed it’s capability to react well in tough situations. When its automated “surge pricing” kicked in during the Covid-19 crisis and rates skyrocketed for rides, Uber responded quickly by offering free rides to Hospital Staffs, Doctors and Nurses in business district, and they reimbursed people affected by the surge pricing. Uber’s actions will respond to create a goodwill of the company, and it needs to follow this script in the future. 03 Value drivers as much as their customers Drivers are the backbone to uber's service, it is important for the company to focus more on the benifits and the safety of the drivers as much as the customers.
CONCLUSION This organization has added to society surprisingly. It costs lower than a city taxi or individual driver and is effectively open to the overall population. All things considered, it has made life simpler for some in the working class. That being said there is an opportunity to get better particularly as far as correspondence where the organization is as yet attempting to reproduce its picture that has been influenced by the discussions it has been drenched in. Of course, it isn't the only portable application which is accessible by transportation administration. Lyft, Ola and others are giving it a run for its cash. All in all, it is an increasingly conspicuous element for its clients who incline toward it over anything else.
Berger, Thor, et al. “Drivers of Disruption? Estimating the Uber Effect.” European Economic Review, North-Holland, 20 June 2018, www.sciencedirect.com/science/article/pii/S0014292118300849. Biographics. 2020. The History Of Uber. [online] Available at: https://biographics.org/the-history-of- uber/ [Accessed 4 April 2020]. Cramer, J. and Krueger, A., 2016. Disruptive Change in the Taxi Business: The Case of Uber. American Economic Review, 106(5), pp.177-182. Griswold, A., 2020. FamouslyUnprofitable Amazon Has Nothing On Uber. [online] Quartz. Available at: https://qz.com/1592971/uber-ipo-filling-reveals-how-it-spends-its-money/ [Accessed 22 March 2020].(Griswold, 2020) McBride, S., 2020. Uber's Nightmare Has Just Begun. [online] Forbes. Available at: https://www.forbes.com/sites/stephenmcbride1/2019/09/04/ubers-nightmare-has-just- started/#62e378ffb7e0 [Accessed 30 March 2020]. Oakley, D., 2020. The Uber Business Model Canvas - Denis Oakley Co. [online] Denis Oakley Co. Available at:https://www.denis-oakley.com/uber-business-model-canvas-success/ [Accessed 24 March 2020]. Rauch, D. and Schleicher, D., 2020. Law Journal Library - Heinonline.Org. [online] Heinonline.org. Available at: https://heinonline.org/HOL/Page? handle=hein.journals/ohslj76div=31g_sent=1casa_token=SbE9rmPvcgAAAAA:bJazcH6sDhIU9OFM w5rBjilFr2IwLY_ssE2ShdJWIF0HSKjNl-G9VTy7xxR12oZRyCKAYrjnXc8collection=journals[Accessed 4 April 2020]. Rogers, B., 2020. Law Journal Library - Heinonline.Org. [online] Heinonline.org. Available at: https://heinonline.org/HOL/Page? handle=hein.journals/uchidial82div=7g_sent=1casa_token=SRDag2VAswgAAAAA:hvbuUO0tuIEX bBB1V9ZCIxJoY0PZj8hK45ZIgppBH7uc1gFrBygouugudAe7ahVdXZSsp_YFSsscollection=journals [Accessed 3 April 2020]. The History Of Uber. [online] Available at:https://biographics.org/the-history-of-uber/ [Accessed 24 March 2020]. WEISSMAN, C., 2020. What Can Uber Do To Fix Its Broken Culture?. [online] Fast Company. Available at: https://www.fastcompany.com/3068682/what-can-uber-do-to-fix-its-broken-culture [Accessed 27 March 2020]. REFERENCES
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