Uber Pricing Strategies and Marketing Communications

...

---------------------------------------------------------------

- In your view, was surge pricing a distraction or a core part of the business model?

In my opinion, whether or not surge pricing is a distraction or a core part is based on what district that Uber implements it in. Surge pricing encourages more Uber drivers to get on the road during peak demands according to Kalanick. In North America, where it is hard to hail taxi on the streets and difficult to call for a cab with short wait-time, customers may be more willing to pay for the surged pricing. Since the pricing is pre-determined, customers can either accept or decline the ride beforehand. In such circumstances, Uber serves as a convenient alternative to the usual taxi system, and consumers will be happier to accommodate to their pricing system. Thus, the surge pricing becomes the fundamental part of its business model in generating more drivers and more satisfied consumers. However, Uber has a disadvantage if the district changes to Taipei. Since taxi’s are seen everywhere on the streets, it is easy to hail for taxi in Taipei. It almost seems unnecessary to call for Uber service in Taipei, unless the consumer has a special need in choosing the car model. Let alone the even less appealing surge pricing model offered in an area that has already been occupied or saturated with convenient taxi-hailing system.

- Should Uber continue on its expansion to other cities or other services? If yes, what are the options? If no, why?

Expansion to other cities can generate more revenue and offer more convenience around the globe, however, Uber must understand the governmental restrictions placed on each district and the availability of local taxi system and its charging system. Different cities exhibit different pricing regulations, cultural background, and local competing companies. Downtown areas of urban cities are always good options for expanding Uber business, but perhaps looking for areas that have a high demand for taxi drivers, with low availability of taxi rides is a good idea.

Expansion to other services can include promotional activities as mentioned in the article on Valentine’s Day, “Romance on Demand” or for Christmas, “Christmas-tree delivery”. Uber can make good use of different holiday festivals and provide promotional activities as such.

Uber can expand its business model to other business segments, for instance, Uber for Dog is already happening. The same concept applies to consumers and dog-walkers.