Strategic Plan

Demo (Uber)

Strategic Business Unit

Uber

For riders, Uber is a convenient, inexpensive and safe taxi service. You can hire a private driver to pick you up and take you to your destination with the tap of a button on your phone - and they'll be there in minutes. Not only is it an on-demand car service, but you can see exactly where the driver is when they're coming to pick you up.

For drivers, Uber provides exceptional pay while allowing you to be your own boss and pick your own hours. You can take on fares whenever you wish (so you can work as little or as much as you want) while meeting people in your city from all walks of life.

Plan Details

This is a demonstration project to show off some of the features of StratNavApp which require more data entry to demonstrate and so are not suited to conventional demonstrations from a new project perspective.

This publicly available report, generated by StratNavApp, includes only the SWOT, Business Model Canvas and Strategy Canvas elements from the demonstration.

Plan submitted by:

Chris Fox
+447786021712

I picked Uber because it is a business I am curious about and I assume many others will be curious about it also. I deliberately avoided choosing a financial services example because I did not want to risk lapsing into industry jargon and concepts which might throw people without financial experience off.

This project is part made up of reported information about Uber and part made up of supposition and guesswork. As I develop the case demonstration I hope to improve the realism of the information contained. At present, only will some of the content be made up, but I will also mix historic events and future plans quite liberally as required.

Analysis

Enhanced Business Model Canvas

Customer Segments

Car owners looking for extra income

They own their own cars.

Cost Structure

Driver fees (80% of fare)

Uber drivers get a respectable 80% of the fare earned.

Revenue Structure

Surge pricing

Variation in cab fares according to situation is an important aspect of Uber’s business model. Whenever the demand increases, per mile prices are automatically increased. The new price depends on the number of available drivers and the number of requests made by people who want to travel. Uber has applied for a price surge technology patent in the US.

SWOT Analysis

Strengths

  • 2 million drivers
  • Lots of cash to attract drivers and passengers when entering a new city
  • Hyperlocal, lends itself to target local advertising
  • High standard of service; including tiered services like Uber Black
  • Low operational costs
  • Cashless payment systems
  • Dual rating system boosts trust
  • Low prices, compared to traditional tax operators
  • Available across many cities, worldwide
  • Passengers know the cost beforehand and can track the route on their phone

Weaknesses

  • Easy to imitate
  • Customers and drivers can easily switch away
  • It is difficult to vet all drivers and their cars
  • Surge pricing can cause customer disatisfaction
  • History of questionable work culture

Opportunities

Threats

Insight Details

Uber is planning an IPO

This will give it access to additional capital from the public markets.

Could attack any small-scale mass logistics problem

The underlying technology will not care what is being transported. The criteria are:

  • There must be a high frequency of requirement
  • Each requirement must be different
  • Each requirement must be small and easily transportable.

Legal challenges and industrial action around driver employment status

Über says its drivers are self-employed, but others argue that the level of control they exert over drivers makes it a contract of employment. This issue is not peculiar to Uber, but affects many participants in the gig economy.

Trust and safety issues

There have been cases where Uber drivers have acted rude to passengers. Some cases where Uber drivers have outraged the modesty of female passengers have come to the limelight. This is a big challenge for Uber. Although the company takes all steps such as police verification of drivers and their ID details but still such cases cannot be ruled out completely.

Note that his is probably a problem which affects all taxi companies, to some extent.

Self-driving taxi's

Uber is currently piloting this in Pittsburgh, and testing, inter alia, passenger reactions (which are video recorded) and liability laws.

Uber suspended its programme in March 2018 after a fatal accident with a pedestrian but reinstated it in December of that same year.

Low operational costs

For example: direct customer-to-driver interaction obviates the need for and cost of dispatchers.

Easy to imitate

The concept itself is easy to imitate. Developing a global footprint, huge driver and customer base will be hard to replicate.

Poor driver experiences damage the brand

An anonymous whistleblower has even claimed there is a subculture among some uber drivers to find ways to rip off unsuspecting customers. (Source: Fresh claims Uber drivers are rorting Australian customers with 'cleaning fee' scam  | Daily Mail Online published 28/12/2018)

Competitive Environment


Competitors

Deliveroo

https://deliveroo.co.uk/

Whilst Deliveroo don't offer passenger rides, they are the primary competitor to Uber's associated delivery service.

Here

Here have an app called SOMO, which works with existing taxi companies.

Lyft

https://www.lyft.com/

A direct competitor to Uber, but not available in the UK. Arguably, they could enter the UK market at any time, though.

Taxify/Hopp

https://taxify.eu/en-gb/

Taxify, which is available in 57 cities, is Uber's biggest competitor in Europe and Africa, and has 150 million users globally. The startup also raised $175 million funding led by German-automotive giant Daimler this year, taking its valuation to $1 billion. (Source: How Taxify, Uber's biggest rival in Europe, is giving it a run for its money)

Uber

https://www.uber.com

For riders, Uber is a convenient, inexpensive and safe taxi service. You can hire a private driver to pick you up and take you to your destination with the tap of a button on your phone - and they'll be there in minutes. Not only is it an on-demand car service, but you can see exactly where the driver is when they're coming to pick you up.

For drivers, Uber provides exceptional pay while allowing you to be your own boss and pick your own hours. You can take on fares whenever you wish (so you can work as little or as much as you want) while meeting people in your city from all walks of life.

Waymo

https://waymo.com/

"We’re working towards fully self-driving cars that make it safe and easy for everyone to get around. Our journey started at Google in 2009, and we became Waymo in 2016."

Competitive Factors

Availability

Availability is the ability to get one anytime, anywhere, and quickly.

Black Taxis: 3 / 9

It can be difficult to find one during peak hours. Fixing tarrifs reduce incentives for extra drivers to come on during peak hours.

Deliveroo: 6 / 9
Here: 5 / 9
Lyft: 3 / 9

They operate in fewer cities.

Mini-cabs: 2 / 9

You can't hail one on the street (legally) and so have to book ahead, or at a central location (e.g. airport.)

Own Vehicle: 7 / 9

Not available in places you've travelled to without your car.

Taxify/Hopp: 5 / 9
Uber: 8 / 9

Uber's scale has enabled it to develop a reputation for being easily available.

Uber (currently): 7 / 9
Waymo: 5 / 9

Convenience

Convenience is about how easy it is to use.

Black Taxis: 2 / 9

You can usually only hail them on a busy street.

Some accept credit cards; most require cash.

Deliveroo: 5 / 9
Here: 5 / 9
Lyft: 5 / 9
Mini-cabs: 4 / 9

Can book ahead for planned trips.

Own Vehicle: 2 / 9

Parking in city centers can be very inconvenient. You may need to fuel and maintain the vehicle yourself.

Taxify/Hopp: 5 / 9
Uber: 9 / 9

You can get picked up anywhere and dropped anywhere, and see where you are on the map at any time.

Payment is cashless: You don't need either a credit card or cash.

Uber (currently): 5 / 9
Waymo: 5 / 9

Price

Black Taxis: 2 / 9

Mileage rates can be high, and are hard to predict.

Deliveroo: 5 / 9
Here: 5 / 9
Lyft: 5 / 9
Mini-cabs: 5 / 9

Can negotiate a fixed price up front.

Own Vehicle: 6 / 9

Assuming you are driving a lot, owning your own vehicle is probably the most cost effective.

Taxify/Hopp: 5 / 9
Uber: 7 / 9

More cost effective than other taxi's. Less cost effective than using your own car.

Uber (currently): 5 / 9
Waymo: 5 / 9

Articulation

Vision

Smarter transportation with fewer cars and greater access.