5 Major Elements of Uber Strategy

Arenas
Where will we be active? (and with how much emphasis?)

Uber is technology based transportation company. Their core business is service

to connect the driver which have a car to the people that need a comfortable ride.
Using mobile apps, Uber connect the driver to the customers. So this channel makes
the customer easier and more practical to get a ride. Uber’s segmentation is actually
simple. People that want more comfortable ride rather than conventional taxi is their
segment (UberX). Those people tend to be in middle to high level of segmentation.
But by the time, they have more segment because there is people want to afford
more money to get more comfortable ride like SUV car or luxurious car (Uber Black).

Geographically, the first launch of Uber service was in big city at USA. By the time,
Uber went globally to capture more markets. Even though Uber facing several threats
regarding its service like safety and policy issues for each country that Uber covers,
the demand of its service is drastically increasing such as in Indonesia.

The core technology that used by Uber is Surge Pricing. This technology has
patented by Uber in USA. The concept this technology is using supply and demand
theory. When the demand of Uber service in certain area is normal, the pricing is
normal as well. But if the demand is increasing in certain area, the base fare and per
kilometer fare is higher as well.

The business strategy that Uber used is cost leadership. It shown by the price that
charged by Uber to customer is lower than conventional taxi with the same distance
and traffic. To afford this strategy, Uber make a new business model for
transportation industry by transferring and the costs like depreciation, maintenance,
inventory and other fixed costs to the drivers. So one of value proposition that offered
by Uber is an exclusive ride with affordable price besides the other value that offered
by Uber like convenience and cashless ride (using credit card as payment method).

Vehicles

How will we get there?

Uber is one of the most innovative company in the world. No wonder if Uber try to
keep develop their business. To maintain its service, Uber keep upgrading its driver
recruitment. And also, Uber try to spread its business to other service like food
delivery (UberFood), Helicopter rent (UberCoper or Uber Helicopter), motorbike taxi
(UberMotor) and so on.

Regarding to penetrates Uber’s market in Indonesia, it should make several

adjustments to establish Uber in Indonesia. Following Indonesian law, transportation
company should has 100% domestic ownership. But Uber is not transportation
provider company, it is a technology company. Which if technology company just at
least has 65% of domestic ownership. To afford this market, Uber should take an
action to joint venture with domestic companies such as car rents in Indonesia.
And it has done by Uber to cooperate with several required car rents (to maintain its
quality of service, Uber should sorts the competent rents).

Differentiations - How will we win in the marketplace?

Differentiators are features and attributes of a company’s product or service that help
it beat its competitors in the marketplace. Uber provides an on-demand car service
app powered through the smartphone platform. The software manages a network of
drivers and passengers through a phone application, provides options and varieties
in the transportation service, making the process user friendly and eliminating money
transactions, although now the transactions can with cash. Uber caters to several
target markets by providing differentiated services. The types of available cars
include uberMOTOR, uberX and UberBLACK. The most affordable for car is uberX,
which directly competes with traditional taxi services. The following below are some
differentiations of UBER:
1. Real Time Ridesharing
 Shares the same car and destination
 Individual costs
 Uses latest technologies
 Uses GPS and smartphones
 Social Networks
 Geared towards profit or commercial gain
2. Passengers
 One tap to ride
 Reliable pickup
 Status sharing
 Ride feedback
 Cashless
3. Driver
 Flexibility to drive
 Extra income
 Drive with assurance
4. Pricing structure
 Flexible, because of surge pricing (during high or low demand)
 Base fare
 Metered fare based on time or distance

Differentiators are what drive potential customers to choose one firm’s offerings over
those of competitors. The earlier and more consistent the firm is at driving these
differentiators, the greater the likelihood that customers will recognize them.