Almost every modern Internet user has a personal page on the network. If you are thinking about developing your own business in a social network, you need to create and set up a business account. Uber is one of the best business cases, there are no stories, there is a huge collection of facts. As a professional, I will tell you all the nuances of creating such a profile and help you choose the right features in practice.
Setting Up A Business Profile Is Easy:
- Open the Uber app, select Pay and scroll down to Add a Business Profile under Trip Profiles.
- Select or add a payment method for business rides.
- Enter your business email address and select a cost accounting system.
- Done!
What Is Uber For Business
Drivers
- The most expensive part of the business is hiring drivers. Bonuses for one new driver can be $2000-$5000 for just a few trips. Then the drivers are gone.
- Driver costs in the second quarter (payments, promotion, marketing): $918 million.
- Driver churn is 80% per year. That means only 20% of drivers remain after a year of employment.
- Uber orders $4 billion worth of cabs a month, their share is ~22%.
- The churn of drivers in America is due to very low income. After taxes, drivers make about $10 an hour, which is very low for the States.
Customers and Markets
- As market share grows, the price of attracting a customer has steadily fallen. The main growth channel of all time is the referral program. $20 for downloading the app and making your first ride.
- 95% of early Uber customers learned about it from friends.
- Serves customers in 600 cities.
- The highest price for attracting customers was in Russia and China due to local players gaining strength. “Yandex, of course, are the big doers!
- In Shanghai, an Uber ride brought in 150% of the loss from its price. There are no figures for Russia in the report.
Competition and Government Regulation
- Lyft has recently grown much faster than Uber, constantly closing the gap. Its market share in America is already 28%, Uber has 70%.
- The most important part of Uber’s business model is the lack of drivers’ salaries. They are all Independent Contractor (a type of IE). Local officials are always trying to ban Uber for this.
- Uber’s main line of defense against officials is the “Travis Law.” This is the hypothesis that people love Uber so much that they would be very unhappy with the government if they banned it.
- The Travis Law works well in America, but not in Europe and Asia.
- In Germany, South Africa, and Hong Kong, Uber works with cab drivers’ salaries and pays all taxes.
- Since 2016, New York City has imposed strong barriers for Uber. To hook up one driver, you have to pay $3,000 and take several weeks of courses. Spending $6.6 million on lobbying in New York didn’t help.
- In London, Uber was banned for a long time. There, it took paying huge insurance premiums for each driver to return to the market.
- In Canada, they had to invest about $200 million in the country’s economy to remove government restrictions.
The Future and Autopilots
- Uber’s next bets on alternative vehicles are scooters and autopilot cars.
- With scooters, it’s interesting. Uber has commoditized the ride market so much that the average trip distance has become only 3.2 km.
- Experiments are underway with Uber Rush – delivery of everyday goods from a limited list.
- But still the main goal of the company on the way to wild post-IPO profitability, is to reduce the main cost item – people. The same ~70% that goes to drivers, who constantly leave and are so hard to manage.
- And even in the autopilot model, Uber doesn’t plan to own the cars. It’s just that the car companies themselves will now provide them. Uber will only be a technology partner.
- The company has long focused on serving the congested centers of big cities. Now it’s expanding into the suburbs at full speed.
Uber Advantages
A wide choice
The Uber app has been in operation for more than a year now, and it’s getting more and more users every day. This means that more and more new cab drivers and their clients are registering in the database. For the client it means a greater choice of cabs, different prices. For the driver, it’s the certainty of having customers.
The service is global
The service works in many countries around the world. Going to Western Europe or America you will not need to worry about how to call a cab. It’s enough just to use the service Uber. You need only an Internet connection and a phone.
Payment methods
We offer convenient ways of payment – both in cash and by bank card. The card can be tied to your account, which further simplifies the use of the service. This is a large service, known throughout the world, so he will not risk his reputation and create fraud with cards. By connecting an e-mail account, the customer can receive receipts for the trip. This is very convenient for those who are on a business trip or need travel documents for other reasons.
The Last Word
Uber is one of the largest online cab service providers in the world. Uber has solved the problem of local cabs, accepted customers well, seized growth opportunities, and used word-of-mouth advertising to gain and maintain such an extensive customer base. All of this is paramount to the success of Uber’s business model, and the fact that people these days have a hard time comparing before choosing a booking app is proof of that. Uber has changed the rules of the game, both as a cab company and as a business model, and it has inspired many other startups around the world. It is successful and will only grow more.