Uber Business Strategy: User Convenience through Technological Innovation

By John Dudovskiy
July 17, 2021

Uber business strategy consists of the following 4 pillars:

1. Increased service range to cater for the needs of great amount of customers. Extensive offering is rightly considered as Uber competitive advantage. Depending on their budget, the occasion and purpose of ride, customers can choose among Uber X, Uber XI, Uber Pool, UberGO, Uber AUTO, Uber Access, Uber MOTO, Uber Premium or Uber Rush.

It is important to note that the ride-hailing giant has been consistently increasing its range of service on the basis of the same platform and therefore, utilizing the same set of competitive advantages. Accordingly, each additional service comes for little additional cost for the company, effectively contributing to the bottom line.

Uber business strategy

2. High level of user convenience. Uber offers unprecedented user convenience at multiple levels. No need to call dispatch, wait in a line, or wave from a curb. Customers can tap ‘Request” on their phone from comfort of indoors and wait for notification that their driver is “arriving now.” Even in dense urban locations Uber drivers usually arrive in 1-2 minutes.

When they reach their destination, customers just say thanks and get out of the car. No need to reach for cash or credit card. The payment is automatically charged to card on customer’s Uber account and receipt is sent via email. Moreover, dispute resolution with Uber is easy.  Each ride receipt includes a map and a GPS track, customers can complain if their driver took a longer route and Uber is prompt with refunds.

3. Cost-saving through innovation. Extensive user conveniences described above come for a little cost for the company, thanks to the app that integrates innovative features and capabilities. Therefore, it can be argued that operating at low costs thorough innovation is placed at the core of Uber business strategy. Moreover, first mover advantage in internet-based ride-hailing sector is one of the most important points of Uber competitive advantage.

4. Growth through acquisition. Attaining high growth rates through acquainting related and adjacent businesses is an important element of Uber business strategy. The most notable acquisitions by Uber include artificial intelligence company Mighty AI in 2014, grocery delivery app Cornershop in 2015 and geospatial software platform deCarta in 2015. Even in pandemic-troubled year of 2020 the ride-hailing giant completed the acquisitions of vehicle hire company Careem, food delivery service Postmates, taxi booking and dispatch software Autocab and transportation technology firm Routematch.

Uber Technologies Inc. Report contains the above analysis of Uber business strategy. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on Uber. Moreover, the report contains analyses of Uber leadership, organizational structure and organizational culture. The report also comprises discussions of Uber marketing strategy, ecosystem and addresses issues of corporate social responsibility.

Source: Uber Technologies Inc. Annual Report 2020

Category: Strategy