Uber SWOT Analysis | The SWOT Analysis of Uber
Date: 7th Sep. 2020
Company: Uber
CEO: Dara Khosrowshahi
Year founded: 2009
Founded: Founded in 2009 by long-serving CEO Travis Kalanick (now resigned, though still on the board)
Headquarter: San Francisco, USA
Number of Employees (2018): 16,000+
Public or Private: Public
Ticker Symbol: UBER
Market Cap (Sep 4 2020): $ 58.26B
Annual Revenue: Revenue stands in 2019 $4.1 billion, It is growing 37% year-over-year.
Profit |Net income: Uber presented an operating loss of $3 billion in 2018 after losing more than $4 billion the prior year. (The company recorded a net profit last year because of $5 billion worth of one-time gains, mostly from selling its Russian and Southeast Asian businesses.)
Products & Services: UberX | UberSUV |UberBlack | UberXL | UberPool | UberPlus | Uber eats | UberSelect
Competitors: Lyft | Curd | Ola Cabs | Didi Chuxing | Grab
Fun Fact:
Did you know that 87% of Uber drivers said they drive on the Uber platform because they get to be their own boss?
Uber SWOT Analysis | The SWOT Analysis of Uber
An Overview of Uber
Uber is one of the biggest online cab services with it’s headquarter located in San Francisco, California. It provides peer-to-peer taxi cab, ridesharing, food delivery, and transportation services. It is operating currently over 900 cities globally. This platform is accessible through its online-based website and mobile apps. As its launch, the company has considerably had an effect on the overall economy. This kind of effect of Uber on other businesses is termed as ‘’Uberization’’.
The name of Uber comes from the most common word which stands for ‘Super’ or ‘Topmost’. Uber is best known for its rapid, luxurious, easy, and simple transportation services.
Recently, Uber launched the ridesharing app phenomenon. There’s no need to step out of your house to hire a cab. It is an all-time favorite service of travelers and android users. You can book an Uber ride from your home and the driver will come to your place at a given time. It’s a big inspiration for many other ridesharing app services such as Lyft, Didi, and Ola.
The company has grown exponentially from the last few years in spite of all the negative reviews and condemnation. But still Uber has a lot of potential and opportunities to introduce and generate heavy revenue. Every company has certain strengths, weaknesses, opportunities, and threats.
Uber SWOT Analysis | The SWOT Analysis of Uber
Uber SWOT Analysis:
Today, we are analyzing SWOT (Strengths, Weaknesses, Opportunities, and Threats) of Uber in detail.
Uber’s Strengths:
1- Leading Ride-Sharing Technology:
Uber has pioneered itself as the leading ridesharing technology worldwide. It is one of the first ridesharing apps, working around the world. In the 2nd quarter of 2020, 55 million people used the Uber app on a monthly basis. Uber has completed more than 5 billion rides worldwide and fulfills 40 Million rides per month only in the USA. Users are right now in the major 900 cities of the world.
2- Strong Brand Identification:
Since its launch, Uber has sustained its position and brand recognition in 50+ countries. It has previously overtaken Honda, GM, and Ford concerning brand worth structure. With these innovative ideas and improvements, Uber will get stronger brand identification in the future. At this time, Uber stands at $72 Billion.
3- Low Permanent Investments:
Uber is based on low fixed investments and has simply accessed more cities in its system. Because there’s no permanent communication and investment, Uber tends to increase at a rapid speed.
4- Variable Pricing Plan:
‘’Higher the demand; higher the price’’ strategy has confirmed to be valuable for the drivers and the company. This dynamic pricing strategy allows drivers to earn significant money at night and throughout bad weather conditions.
5- Adaptive Environment:
The adaptive environment of the company has huge appreciation around the world. Because Uber has a strong impact globally that’s why it gives trust and consistency to its customers. For example, Uber uses its social media accounts to remain in touch with their customers or consumers. They also advertise brand services, deals, promotions, and updates through social media platforms such as Instagram, Twitter, and Facebook. Plus, they also address the complaints through social media. This smart marketing allows the company to engage with their loyal consumers and quick feedback.
6- Highly Affordable as Compared to Cabs and other Ride-Sharing Apps:
You can easily book a ride at an affordable price through a mobile app. Uber facilitate their users in every aspect and charges per minute and per mile for moving and idling both. This kind of strategy has confirmed beneficial for users. Uber is one of the cheapest ridesharing services as compared to Lyft and SideCar in 20 main U.S cities. But the price may vary due to geographical location, rush pricing, cancellation charges, and distance traveled.
7- Consumer to Driver Relations:
Uber business model is perfect for a consumer to driver interaction. The company has formulated a rating system that allows the user to rate their moving experience plus the driver. In this way, the company identifies the top drivers and improves its performance.
Uber SWOT Analysis | The SWOT Analysis of Uber
Uber’s Weaknesses:
1- Numerous Scandals:
Recently, Uber has faced a huge backlash and negative exposure due to multiple controversies such as sexual harassment and beleaguered attacks. As a result, the co-founder of Uber Travis Kalanick had to leave his job. The public protest on social media with the trend #DeleteUber and almost 500k consumers removed their accounts in 2017.
2- Substantial Losses:
After facing a lot of criticism, the company had to face substantial losses in its revenue. Uber offers special bonuses to its drivers and exceptional discounts to its customers in order to compete. This strategy resulted in Uber’s net losses to surpass $2.75 Billion.
3- Dependency on the Workforce:
Uber is totally dependent on its workforce. The unpredictable behavior of drivers has spoiled the company name and image. In the US, almost 103 Uber drivers were blamed for the abuse and sexual harassment which predicts a poor image of the company culture.
4- Public Criticism:
During Sandy Hurricane, Uber experienced a strict public criticism over its sky-scraping prices. So, the company had to revise its pricing policy.
Uber SWOT Analysis | The SWOT Analysis of Uber
Uber’s Opportunities:
Accountability and Performance:
It is a fact that people don’t want to travel in lecherous and unorganized cab services. It’s a big chance for Uber to maintain its performance and check the driver’s behavior. This kind of accountability will improve the behavior of drivers and performance. The company can recognize its top performers by tracking their work. Most importantly, if the company has succeeded to address sexual misconduct then there’s a huge scope to generate profit.
2- Employ Digitalization:
The scope of digitalization is increasing regularly. The power of the internet can change the face of the world. Uber should maintain to spend in Uber Eats and increase its fan-following. Uber should focus to start its operations in China and Denmark to increase customers.
3- Driverless Technology:
Uber should think about driverless technology in order to prevent sexual harassment and abuse cases. They should start new services such as ambulance and other emergency vehicles. This is the best way to gain more fame in public and typical media.
4- Logistics:
Uber can introduce its mover and packer services for the customer’s ease. They have many resources to initiate this project.
Uber SWOT Analysis | The SWOT Analysis of Uber
Uber’s Threats:
1- Consumer and Worker Retention:
It is important to create a balance between customers and employees. As we know that, the competition in the market has regularly increased so a little incentive from the opponent is enough to rob Uber consumer base and workers.
2- Lawsuit:
Almost 300k Uber drivers filed a court case against the company due to its negligible wage strategy. But this kind of happenings can destroy the image of the company.
3- Growing Competitors:
Other ridesharing companies such as Lyft and Didi are the biggest competitors of Uber. In fact, Ola in India has extensively damaged Uber.
Final Thoughts:
With the help of the Uber SWOT analysis, you can easily know the problems of transportation services. Despite all the scandals, the future of Uber looks promising. With the assistance of a professional team and management, Uber has the potential to increase its customer base and popularity.
Please share your views and comments in the comments section.
Read More:
PESTLE Analysis of Starbucks | Starbucks PESTLE
PESTLE ANALYSIS and Its Impacts on Marketing
SWOT Analysis || SWOT Matrix || Strategic Assessment