It’s not often we see an uproar of protests, reviews of regulatory policies and political reforms against a technological company. But this is no ordinary company. It’s a company disrupting conventional transport on a unprecedented scale, completely transforming the way people move from A to B. This is Uber, the company that is yet to post a profit. And here is how it’s playing the game, clean and dirty. Whatever it takes.
Uber Didn’t Knock on the Door
Almost every company goes into a long procedure of due-diligence on whether they meet the regulatory requirements within their industry. Uber on the other hand, sought out no permission and immediately entered the market with no regard to any regulatory backlash. Their argument was a simple one when interrogated by authorities; your rules don’t apply to our business model. They went further, criticizing the regulators up-to-date creativity, that they failed to account for Uber’s ride sharing technology.
But You Need a Taxi Medallion
Not if we just;
- Accumulate cars by slapping our brand name on it.
- Declare our drivers as independent contractors instead of employees.
- Provide a GPS software to arrange pick-ups and drop-offs.
Uber’s entire business structure circumvents the taxi industry, thereby requiring no medallions. And as a result, we get an upheaval of protests from taxi drivers to ban the Uber business model. As of 2020, there are seven countries that maintain complete ban on ride sharing companies predominately for unfair competition.
When Uber entered the market, it offered new drivers $1000 to sign up as an Uber driver and referral bonuses for any subsequent drivers. Under these incentives, mass adoption followed. Then they went further and created their own version of subprime mortgage lending (but on cars) by allowing those with low credit scores to get deals on vehicles. In 2013, in an attempt to recruit more vehicles and passengers, Uber employees fabricated poor service for rivals by scheduling and cancelling lift requests. Whatever it takes. Then they engaged in covert tactics against law enforcement using a tool called “Greyball” that enabled Uber to operate in banned cities by circumventing authorities.
Just Buy Politicians
Uber’s lobbying efforts far exceeded any other company when it came to gaining power through political influence. They have spent millions in an effort to ‘bend’ the existing laws around transportation, taxi industry, ride-share insurance and human resources. A bold act from the CEO gained him a position on Trump’s economic advisory board (which backfired aggressively) in an attempt to discuss the executive orders with regards to immigration and its impact on Uber’s workforce.
Protests were Just a Marketing Opportunity
“You never let a serious crisis go to waste. And what I mean by that it’s an opportunity to do things you think you could not do before.” – A quote by the politician Rahm Emanuel. In 2014, a taxi protest in London broke out which congested the entire city. It wasn’t entirely peaceful, with some Uber drivers becoming victims of cab driver attacks. There were roadblocks and demonstrations all over the city. What did Uber do? Seize the opportunity to market it.
“Uber. The car service that keeps London moving”. Result? 800% surge in sign ups.
The Company that Plays it Dirty
In my MBA, we have studied a lot of companies; their operations, marketing, business model and services. Very rarely do we come across a company like Uber, who are changing the landscape of an entire transportation industry through their technology, amassing infinite amount of regulatory scrutiny while standing tall against it. They are not the most admirable company that stand out for character, having cultivated a toxic company culture over its early years. But their covert tactical implementations and their resilience to stay in the game is sublime. I never endorse the use of cunning methods when providing a service, as I believe those choices to have costly implications. But perhaps in Uber’s case, the cost of surviving was in fact, to use extreme cunning measures. To do whatever it takes. Against overwhelming odds and with all things considered, it has worked well thus far. Check out 49 of the biggest scandals in Uber’s history | Business Insider.
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