Business Strategy: Uber's Business Model And Strategy

Decent Essays
1. What are Uber’s business model and strategy?
The business model of Uber is to offer a convenient, cost-efficient, and safe customer value proposition. First, riders can use the app through their mobile devices and easily ask for a driver to pick them up at their exact locations. Second, apart from the value of convenience, Uber offers safety since riders could also track the car’s location while en route, which was pre-chosen at the time the ride was requested. Third, Uber enhances the cost-efficiency of transportation through providing price transparency and better options as prior to officially requesting a cab, Uber riders could estimate the cost of the ride and reject it if it was too high. Moreover, riders can also choose to split the
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Viewing drivers as contractors decreased Uber’s liability for drivers’ actions and obligations to pay certain taxes as well as the responsibility for a minimum wage. Also, drivers were unable to unionize or receive benefits from Uber. Additionally, since Uber insists that it is a technology and lifestyle company, it avoids paying for the costs associated with the business models of taxis and other public transportation firms.
Uber’s business model and competitive activities indicate that it has a broad differentiation strategy by providing unique service attributes that a wide range of buyers find appealing and worth buying for. Uber, especially at the onset, is unique because it is a technology and lifestyle company that made it "cool" to either drive for riders or share rides with other people. Uber also enhances customer service through an app that provides the cost of the ride early and charges it conveniently on one's credit card.
2. How would you describe competition in the ridesharing
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Does Uber operate as a socially responsible business?
From a business point of view, if Uber is considered as a technology and lifestyle company, then it is operating as a socially responsible business. As a tech firm, it is only obligated to offer an app that works well in getting timely transportation as efficiently as possible. Also, as a lifestyle company, it only needs to satisfy customers; their happiness with the app and services are all that matters. Likewise, Uber is giving extra livelihood opportunities to drivers as a form of social responsibility.
Nevertheless, if there are protests from drivers and customers, then Uber should address them in order to be seen as socially responsible. For instance, if a driver complains that Uber is too harsh in cancelling accounts and focusing too much on customers only, then the company has to understand these concerns and respond positively. After all, it cannot attract more drivers if it is perceived as too customer-centered. Moreover, Uber should apply surge-pricing ethically and reduce it in times of environmental distress, such as during disasters. Customers are already suffering, a condition that Uber should not take advantage of. Also, Uber should perform more rigorous driver background checks and monitor as well as punish illegal or unethical behaviors in order to promote ethical
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