Uber has become enormously popular across a wide range of customers. What factors help explain the rise of this company?
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- The rise of social media made a range of organizations explore the business opportunities that virtual networks had to offer. Uber is one of the companies that took full advantage of the chances that social media provided (2);
- The clever use of social networks as the foundation on which the service was developed can be viewed as the primary driving factor behind the rise of the company (2);
- The fact that a rating system was provided should also be deemed as an essential addition to the customer satisfaction levels since it created an impression of an efficient feedback system and an improved communication process. Indeed, by rating the services, people will feel that their voices are heard. The company, in its turn, can use the received information to focus on the areas that need improvement (3);
- More importantly, the ratings may serve as the means of locating the available opportunities and expanding the services so that the company could appeal to a wider range of customers. After Uber had used the identified factors to its advantage, the profits of the company skyrocketed, making it one of the most widely recognized brands that have appeared over the past ten years (3).
What are some of the sources of tensions within the model (e.g., surge pricing, treatment of drivers)? Should these tensions be resolved? What approaches would you suggest?
- The aggressive manner of the marketing process, which the business model used by Uber suggests, can be considered the primary source of tension. While being admittedly efficient, it may be seen as annoying after a while. As a result, there is a threat that the framework used by the organization will ultimately avert a lot of people and become counterproductive. The tension does not need an urgent resolution. However, it could be suggested that a more subtle marketing approach should be used (9);
- The fact that Uber drivers are not fully employed should also be mentioned as one of the problematic areas. The absence of permanent employment implies that the drivers, as well as the customers, may be exposed to threats associated with the lack of the drivers’ skills, the possibility of a robbery, etc. The tension should clearly be resolved. For this purpose, a, higher security levels are desperately needed (4);
- The conflicts between Uber and taxi companies also deserve to be listed among the most evident sources of tensions. Seeing that Uber offers its customers much greater flexibility, it slowly ousts taxi companies from the market. As a result, confrontations between tax companies and Uber are becoming quite common. Although the tension is growing out of proportion, it does not need to be addressed by Uber. Instead, taxi companies should view the issue as an impetus for change and the provision of improved services to the customers (7-8).
How robust is the Uber model? Do you believe it is resilient? Why? Why not?
- Even though the model used by Uber seems quite robust and has delivered impressive results, it may need improvement (9);
- On the one hand, the emphasis on the significance of innovative and disruptive technology allows the firm to thrive in the ever-changing environment of the global market. Therefore, the focus on IT-related opportunities must be maintained (104);
- On the other hand, the manner in which the company markets itself may become obnoxious at times due to the obvious, in-your-face way of promoting Uber services. Therefore, while having a certain amount of resilience, the model could use a significant improvement. The shift toward a smarter marketing model could become the foundation for building an army of loyal customers (9);
- Furthermore, by getting rid of the feature that most competitors use as the firm’s weak spot, Uber will be able to increase its competitiveness levels greatly. Thus, it is recommended that the organization should improve the current framework (6).