By Jared Hanna 216369106 – Jhanna4
When I arrived to my office on this particular Thursday, I noticed something was awry. There was a buzz in the air, a feeling of excitement and, to my surprise, a packet of Schmackos on my desk.
Thursday 25th of February 2016 was UberPuppies day, and we had five of these glorious creatures for 15 minutes, chewing, chasing and pouncing on anything not tied down.
What seemed to be a novelty event by Uber is actually part of a cleverly constructed, multifaceted marketing strategy that incorporates tactics, such as cause marketing, to grow market share over the conventional taxi service.
Instead of competing head to head in the same market with the well-established taxi business, Uber’s chosen strategy uses product diversity (such as UberPuppies) to differentiate them from what the taxi business engages in.
People need to go places
Entering an existing market, and being innovative with their product, Uber have identified their growth in what Johnson, Scholes and Whittington describe as the Product Development strategy in Ansoff’s growth matrix. Although Uber leveraged the existing customer segment using the taxi-service, they were first to provide a smarter solution, taking customer pain-points within the taxi service and using these as part of their value proposition.
The rideshare industry has a long and established history, with the first service being provided in London in 1605 via the use of a horse drawn cart. Moving forward some 400 years, in 2014, the taxi industry alone was transporting over 400,000,000 people in Australia, with an average fare of $23.00. This is clearly a field that is worth playing in. Now, how to win?
Although Uber seems to be all things dog related, there is one instance where they are not. This is in the Boston Consulting Group (BCG) Matrix. Uber, and Uber products, are not a ‘dog’, but instead a ‘star’. One could argue that when Uber first launched they may have been a ‘question mark’ but are now definitely ‘star’ status with enhanced market share and innovative marketing campaigns such as UberPuppies.
How has Uber been so successful
To understand the success of the Uber strategy and how it is differentiated from the taxi model, it’s important to identify where Uber stands in relation to the market they have entered. Iacoubucci would describe this as Uber’s Situational Analysis.
The Situational Analysis
Before we can even start to understand how a company decides that delivering puppies to an office is a good marketing tactic, we need to understand the basics of the business.
Uber is essentially a referral service. Via an App on a personal device, Uber is the middle man connecting customers and drivers utilizing GPS locations. Uber also manages all monetary exchanges by debiting funds from the customer, taking its percentage cut and then depositing the remainder directly into the drivers account. Thereby eliminating the need for cash to change hands. The prerequisite to work with Uber as a ‘partner’ (driver) is to hold a current driver’s license and have a road worthy car. By using this structure, Uber does not have to purchase, or maintain any tools of the trade, minimizing its expenditure.
Unfortunately, this operations model is causing much stir with Uber’s main competition, the Taxi service, which has many ongoing costs including the operator’s car maintenance and Taxi registration, both of which are governed heavily. This has lead to Uber being banned or made illegal in some Australian states, at least until those local governments can work out a way to tax them. It is of course these states who are responsible for selling the taxi licenses’ to the operators, which at this rate will eventually become worthless.
Not only has Uber eaten into the rideshare market, it has broadened its customer segment far beyond that of the taxi service to now include anyone requiring the delivery of goods such as food, ice cream, kittens and in my experience, puppies. The goods which are being delivered are products from Uber’s many collaborators. Uber uses its online platform to market these events through social media. This not only provides business for it’s collaborators, it builds brand recognition and loyalty with existing and new customers for ‘brand Uber’.
Putting puppies into play
Uber’s marketing strategy has seen success due to a solid understanding of Segmentation, Targeting and Positioning.
Creating a marketing campaign focused towards pet lovers, Uber partnered with several animal welfare groups to deliver puppies to offices. Targeting pet loving office workers with social media accounts, Uber was able to use Snapchat, Facebook and Instagram, to broadcast its plan and position itself. With customer experience and engagement at the forefront of this marketing campaign, Uber created the #UBERPUPPIES hastag and encouraged those luckily enough to be involved to post about it. Thus, creating more brand awareness for Uber and interest in its Uberpuppies campaign.
The last bark
With UberPuppies seeing success for Uber to grow market share, reach new customer segments and build brand loyalty, I can only hope that more innovative product development is ahead. If any marketers from Uber are reading this blog, might I suggest UberBeer, UberLaundry and UberDogWalking?
Australian Taxi Industry Association, State & Territory Taxi Statistics as at December 2014. Retrieved 24 July 2016. http://www.atia.com.au/taxi-statistics/
Iacobucci, D. 2013, MM4, South-Western, Cengage Learning, Mason OH, USA.
Johnson, G., Scholes, K., Whittington, R. 2008 Exploring Corporate Strategy, 8th Edition, Pearson Education, Harlow, England
Lakhani, R. 2008 The Boston Consulting Group Matrix – Revisiting Marketing Models. Retrieved July 24 2016. http://moz.com/ugc/the-boston-consulting-group-matrix-revisiting-marketing-models
McCauley, D. 2016, Uber launches ‘the Katter option’ in response to the Queensland Government’s tough new laws, News.com.au, Retrieved July 25 2016. http://www.news.com.au/finance/business/travel/uber-launches-the-katter-option-in-response-to-the-queensland-governments-tough-new-laws/news-story/32f6aa8492a58c9d81498e088331e227
Uber Australia website, Uber needs partners like you. Retrieved July 24 2016. http://partners.uber.com/join/
#Uberpuppies by Uber and Purina, Uber Australia. 2016, Youtube. Retrieved July 25 2016. http://www.youtube.com/watch?v=HEwBCtO4BBs