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Gutierrez et al.

A Wide Overview of Uber

Silvio Noel Gutierrez

Carlos Gonzales

Rolando Andre Matute

David Umanzor

Introduction to Marketing

Ms. Alicia Martinez

17 April 2017
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Uber a Modern Way to Transport

Nowadays, in Nicaragua there is a lack of a safe and comfortable transportation mean. As

a small country, we only have taxis, and urban-collective (buses) transportation services. Uber is

an application that allows people to have a convenient, inexpensive and safe taxi service. This

works as a private service that picks riders up from a specific point and then takes them to their

destination. By using this application people can get a driver at their pickup place in a few

minutes. Also, users can keep track of the drivers route to their location. Uber will be accepted

by Nicaraguan population because it is an easier, safer, and modern way to move from one place

to other. Moreover, Uber is feasible solution to the insecurity, inaccessibility, a high cost that

taxis has in Nicaragua. Furthermore, the establishment of Uber will give some cars owners the

opportunity to earn a nominal wage. However, the taxi cooperatives are direct competitors to this

service. In fact, the government already say that they will not allow Uber to enter into the

country to avoid possible conflicts with taxi drivers.


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Abstract.

This essay is about Uber, which is a modern and technological company that uses its ride-

sharing app to connect customer with drivers. This essay includes a description of Ubers

strengths, weaknesses, opportunities, and threats. Moreover, the organizational and marketing

goals are discussed and explained along with the philosophy of this company. Uber has a wide

target market because the service that it provides is a necessity for the society. Uber has many

places to position their business and the essay describe its target market and some places where it

enter. This essay explains the demographics, psychographics, geographic and benefits sought that

Uber has. The market segmentation, strategy, depth and breadth of the market, after-sale service,

company image, values, and product life-cycle stage of the company are explained in the product

analysis section of the paper. The essay defines the countries and places where Uber is currently

working. Furthermore, it includes the promotion strategy and the way in which Uber interacts

with its customers and workers. The promotion section includes the way in which Uber handles

its public relations, sales promotion, and selling tactics to reach its customers. Finally, the price

section depicts Ubers pricing strategy and the way in which it distributes its profits with its

drivers.
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Business Mission Statement


Uber is a company that was initiated by Travis Kalanick and Garrett Camp. The idea

began when both had trouble hailing a cab on snowy Paris evening in 2008. They thought about

having a ride by simply taping a button on their cellphone (The Uber Story). Nowadays Uber is a

company that is worth more than 40 billion dollars, and during 2015, economists expected it to

generate a yearly revenue of 10 billion dollars (Pestle Analysis & Frue, 2016). According to its

website, Uber business mission statement is Finding the way, creating possibilities for riders,

drivers, and cities. Uber wants to achieve this goal by making transportation as reliable running

water, so that everyone benefits. Customers find Uber as an innovative, secure, and easy way to

transport. While for drivers, it represents a flexible way to earn money (Uber).
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SWOT Analysis
Strengths

a. Uber is a world-wide recognized company


b. Offers a high standard of service. Ubers drivers treat their customers kindly, and ask

them for any suggestion that they have about the service.
c. People consider Uber a safer option than the taxies.
d. Prices are cheaper than some traditional taxi services. In some places such as the airports

or the outsides of the cities, taxi cost are very expensive.


e. Because of its flexibility, Uber has several drivers. Which means that the company has an

unlimited fleet of vehicles.


f. The business is based on customers to drivers interaction which means that there are no

dispatcher. Furthermore, the gas, oil, and auto parts are covered by the driver, which

means that there are very little operational cost.


g. Besides taxi, no other platform, company, or application offers the same service than

Uber.
h. Due to its high profitability many people is willing to invest in Uber.

Weaknesses

a. Drivers spend a lot of money in operating their vehicles. Therefore the end up by having

a small earning.

b. Uber has not no created a policy that prevents competition from entry the market and

presenting the same product.

c. The relationship between Uber and drivers is not strong, so the loyalty between Uber and

its drivers is very low.


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d. Privacy concerns. Because the application uses the cellphones GPS function, some

customers might argue that the application tracks their position. These customers might

be afraid that position can be traded with intelligence agencies.

e. Uber service is only available for people who owns a debit or credit card, and it cannot be

paid with cash.

Opportunities

a. The market for the transportation service is wide, because the world-wide population is

growing.

b. Uber can improve its operations in order to look more profitable for new investors.

c. Uber can implement the use of hybrid cars not only to reduce operational cost, but also to

reduce environmental-contamination.

d. Uber can entry exploit new markets such as Central-America and India where taxi

operators do not provide a convenient and quality service.

e. Uber can introduce new services such as transporting children to school, patients to the

hospitals, and pets to their veterinaries.

Threats.

a. In countries such as Nicaragua, violence and insecurity affect this kind of business. Even

though Nicaragua is considered as a safe country, violence can take place because of the

rivalry that taxi operators have with this kind of business.


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b. Uber might have problems with local authorities such as the MTI (Ministerio de

Transporte e Infraestructura), because of the way in which this entity regulates the

transportation services.

c. Nowadays, google is testing the use of self-driving cars, which is an idea that can

eliminate the need for Uber.

d. Some drivers argue that they are not happy with their earnings. Therefore, it can lead to

bad publicity discouraging new drivers from joining Uber.

Organizational and Marketing Goals.

Create a new transportation alternative for short and medium distances travels in

Managua.

Help to reduce traffic jams on peak hours in Rtda Ruben Dario, Carretera a Masaya and

other areas on the urban area of Managua.

Provide a sometimes needed second source of income for car owners.

It will provide healthy competition for the cabs industry by promoting clean units, good

drivers and security and capacity to share feedback about the driver (perfect to deal with

aggressive drivers in Managua).

Also it will provide standardization on the prices for a ride to any point on the city

because taxi prices barely remain the same between units.


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Tourist from Western Europe and north America will be providing an even greater

feedback about our country thanks to the diverse and personalized riding option Uber will

bring to our streets.

Target Market

On every single city Uber is present it has remain consistent on its vision as company, they are

looking to be cover the maximum amount of routes possible at any given day and this makes

their target market really massive, truly vast. Simply said their target market its everyone who

doesnt own a car, a tourist on a foreign country, an elderly person or a teenager whose family

doesnt have time to pick up. Now as seen on the demographics for Uber users in Costa Rica and

Panama where the company is already present we can expect a similar trend in Nicaragua,

according to Humberto Pacheco general manager of Uber for Central America the most

enthusiastic sector using their services are individuals ranged 16-34 years old asking for short

rides and barely traveling between cities.

Product
Uber is a company which provides exclusive transportation to any user that possesses the
application in his (or her) Smartphone. Yet, lots of Nicaraguans may find trouble identifying the
usage and benefits of our service; thus, continue using public transportation. We must recognize
our service as an unsought product due to lack of awareness of our app in the region.
Consequently, a proper and effective promotion strategy is required to gain field in Nicaragua.
Although Uber requires the use of an electronic device to call the driver into your
location, this service results favorably easy to use. Furthermore, since most of our service is to be
provided in Managua and certain routes outside the capital, Uber is not to start with a complex
product mix width nor breadth. The following table explains the width and depth of our service.
Basically Uber cabs are willing to start circulating across Managua and special services (not
available at all hours) that are able to transport the user from Managua to other principal cities
such as Masaya, Leon, and Jinotepe.

Width of the Product Mix


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Depth of Exclusive Uber cab transportation


the Product Uber Cab
Lines Interlocal Uber Cab

Branding Strategy.
Ubers considers itself as a technological company that is
changing the way the world transports. The company is
making cities safer, smarter, and more connected.
Moreover, this company is focuses on bringing
opportunity to millions of people around the world
(Uber.com, 2017). Uber bets on getting the positive
comments of their users, via social media and word of
mouth. According to an article by Quora, Their focus
other than good professional drivers and impecable automobiles is centered around the app.
Being able to select the driver and type of car without the need to carry money versus hailing a
cab on the street is UBER main advantage in their communication strategy. The functioning of
the app is vital for their operations, so that the customers can enjoy a pleasant experience.
Warranties that Uber provides are reflected in the use of the app itself. The simplicity but
the effectiveness of the app is exactly what the consumer is expecting. An app were time before
arrival of Uber is measured; along with features of the car such as color, year, model, etc. All of
these characteristics are making a difference from traditional taxi services.
Another aspect that excels when creating a solid product is the brand name and brand
value. Since Uber is a multinational service company (located in more than 100 countries), the
brand name has already been given trough a trademark. Uber logo is easy to identify and it has
required all regulations to register at the U.S. Patent and Trademark Office. On the other side,
Uber is still a new product in Nicaragua; hence, it is important to undertake certain strategies to
develop a new product in the Nicaraguan market. It is important that innovators are willing to try
the app and our services, which shows a optimistic image since many people (average age: 16-
35) already know how Uber operates.
The following table explains the new product development process for Uber in Nicaragua:
Step Description
Uber is to provide exclusive cabs to users that
download the app. Customers can demand a
New Product Strategy Uber cab at almost any time at almost any
place.
Idea Generation Include:
Customers: Nicaraguans do not make
an usual usage of traditional can drivers
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due to several factors such as: lack of


trust, lack of availability, old cars,
rudeness of drivers.
Competitors: cabs cooperatives have
certain mistakes that leave a gap
between their services and
expectations. Uber is to fill the gap and
needs of the customers.

Idea Screening The idea of Uber cabs has had a positive


response by the Nicaraguans, especially
population which lives in a rapid pace in the
city (young Nicaraguans), but do not own a car
to move freely.
Business Analysis In order to forecast sales, revenues, costs;
certain factors should be analyzed in the
market. In other words, the demand for Uber is
to increase at certain time of the day, certain
day of the week. Competitors are to improve
the conditions of their vehicles and impose
better tariffs.
Development Uber is not actually in charged of development
of vehicles, but there are high standards as to
the quality of cars to make it available for Uber
users.
Test Marketing -
Commercialization -

Place.

Uber, being a multiplatform that facilitates transportation to users who have download the

app into their Smartphone (free-cost download), is set to be a the most possible number of places

and to be available as many hours as possible. It is relevant to understand that physical places

require different consideration when it comes to a services rather than a product. Given that Uber

users are looking to move from one place to another in a fast pace, marketing research of the

following aspects has been executed: rush hours in Managua and in between department;
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distance between frequently visited places such as watering holes, malls, night clubs,

government agencies, etc; lastly, delinquency rates arranged by areas in principal cities.

Rush hours are a factor subject to analysis not only to avoid traffic, but to identify what

locations are established among them. Infographic 1.1 displays principal streets and boulevard in

Managua (Alcaldia de Managua & MTI, 2016). The main avenues identified are Carretera a

Masaya, in which 80,000 vehicles make their way in or out Managua (Moncada, 2016).

Likewise, Carretera Nueva a Leon has experience a boom in residential projects which has

increase vehicular circulation (Moncada, 2016). Finally, the overpass between Invercasa located

in colonia Centroamerica holds malls, schools, universities, and public institution (Moncada,

2016). Furthermore, it is important to disclose that these routes are not the only streets were Uber

users can make use of their app; yet, it is important to recognize viability at least among the

Nicaraguan capital.

Secondly, in order to establish a pattern of Uber drivers locations, FVP (Frequently

Visited Places) must be identified. Our main objective of this research is to forecast the demand

for Uber services; thus, optimize revenues in these crowded areas. Furthermore, Managua offers

many aspects that places like Granada and San Juan del Sur does not bring: a true big city

atmosphere (Llovet-Nava, 2016). First, Galerias located in Santo Domingo is a relative small but

fancy mall with a exclusive areas of bars and restaurants. Reef, Alta Bar and Karaoke are very

famous places were people gather (Llovet-Nava, 2016). Moreover, Llovet-Nava also mentions

Zonna Hippos, located in Los Robles. This establishment is composed by selected sports bars

such as Hippos, Woodys, Embassy bars and others. Other dancing clubs such as Chaman,

located in Avenida Universitaria Casimiro Sotelo; and El Aula, located in Pista Juan Pablo II.
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According to Google Maps, all of these locations are in between an average distance of 5km (10

minutes on average). Picture 1.1 shows the largest destination, from Galerias to El Chaman Club

Equally important, Uber is to provide security to both drivers and users; hence, there are certain

areas that must be taken into consideration due to delinquency episodes that are to be avoided at

all cost. La Prensa presented in 2010, a list of the most dangerous neighborhoods in Managua.

Among these list, areas such as Barrio Jorge Dimitrov, Reparto Schick, Barrio Jorge Salazar,

Villa Reconciliacion excel in robbery cases. The following map shows in detail the areas

highlighted in red.
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Promotion
Uber, a well-known transportation company in the United States reinvented the taxi business.

This innovative idea that generated revenue of $32million in the first and second quarter of 2013,

is an incredible product for many techies that are constantly looking for new products and

services that transform their ways of life. This company spread throughout the globe in 81

countries and 581 cities; used a marketing strategy that helped them get well known fast and with

a great reputation since the beginning. One of the first things Uber did to show themselves was to

sponsor events and giving free trials so that people get to know how they will work. Also they

had a referral program where you can give free rides to a friend, which is a great idea to persuade

people to try the service. And the most important strategy that a company can have to develop

themselves in the market, reviews. Uber received incredibly good reviews of their clients that

used the service at least once. Now a days Uber uses a strategy to promote themselves that

include partnerships such as the ones they have with Capital One Banks, Sherwood Hotels, and

Spotify. But what have helped the company grow the most are their loyal customers. Thats why

they created the Loyalty Program, which is based on having taken more than 100 Uber rides and

you will get a VIP pass which includes benefits such as getting access to the highest rated

drivers.

Pricing
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Uber pricing varies according to what you ask for, as said before; Uber is active in 81 countries

around the globe and every city of the different countries have distinct fares. For example, in

New York the minimum fare for a regular small car is $2.55, meanwhile in Boston the same car

is worth $2. This is because every city is different and it might be the same distances between

you and your destination but tolls, traffic and many other factors were taken into consideration. A

great benefit of Uber is the fact that the costumer is free to pay in cash or with a credit card. This

is one of the major advantages Uber have among their competition which are the taxi drivers.

Having the advantage of picking exactly what you are asking for from a wide variety of options

Uber offers is what distinct them from similar transportation companies. As said before, Uber not

only accepts cash payments, regardless of the ride you asked for there are three different ways to

pay an Uber driver. The first one is cash, the second one is with a credit card; they accept all

major credit cards issued by MasterCard, Visa and American Express. And the last payment

method is with PayTM Wallet, which is a digital payment instrument where you can transfer

money from your bank account or credit card to use for transactions on the platform.

Work Cited
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Moncada, R. (2016, May 06). 10 puntos de embotellamientos crticos en Managua. Retrieved


April 20, 2017, from http://www.laprensa.com.ni/2016/05/06/nacionales/2030298-10-puntos-
donde-embotellamientos-criticos-managua

Nightlife in Managua. (2017, February 20). Retrieved April 20, 2017, from
http://www.escapeartist.com/blog/nightlife-in-managua/

Prensa, W. L. (2014, May 14). Managua con 22 sitios peligrosos. Retrieved April 20, 2017, from
http://www.laprensa.com.ni/2010/01/24/nacionales/14101-managua-con-22-sitios-peligrosos
Pestle Analysis, & Frue, K. (2016, June 21). SWOT analysis for UBER. Retrieved April 18,
2017, from http://pestleanalysis.com/swot-analysis-for-uber/

Pestle Analysis, & Frue, K. (2016, June 21). SWOT analysis for UBER. Retrieved April 18,
2017, from http://pestleanalysis.com/swot-analysis-for-uber/

Uber.com. (2017). Head of Brand Management - San Francisco, CA - Uber. [online] Available at:
https://www.uber.com/sw-KZ/careers/list/29073/ [Accessed 19 Apr. 2017].

Quoracom. (2017). Quoracom. Retrieved 19 April, 2017, from https://www.quora.com/What-is-


Ubers-brand-communication-strategy

Uber.com. (2017). Head of Brand Management - San Francisco, CA - Uber. [online] Available at:
https://www.uber.com/sw-KZ/careers/list/29073/ [Accessed 19 Apr. 2017].
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