As a young college student in Austin, Texas I no longer hear my friends say, "I don't have a ride." This has been made possible due to the successful car ride service app known as Uber. The company's slogan "Your ride, on demand" is made possible to anyone who has the app downloaded on their mobile device. Once the app is downloaded, users are then able to request, ride, and pay via their cellular phone. Uber offers merchant services such as reliable pickups, clear pricing, a chance to provide feedback, convenience, a cashless ride, and the possibility to split your fare with others. You have the options to ride in an UberX, Taxi, Black, SUV, or Lux depending on how much you are willing to pay for the service. No taxi service offers all of these; making Uber a ride into the future in the business world.
Uber's Merchant Model
Currently, Uber is operating based off of the merchant business model. The company provides their service to their customers. Uber makes their revenue based on the costs of each users' ride bringing in millions of dollars each year since the company launched in 2011. In 2015, the company has been projected to bring in roughly $2 billion. However, with large research and development and marketing done for the company, Uber is also losing a lot of money. The revenue the company states also doesn't include the drivers' cut off each ride. Currently, this type of model seems to be working for the company for possibly another few years when a new type of business structure will be needed. If Uber wants to generate more of profit while providing the same service, a new business model must be considered.
Into the Future: The Subscription Model
With the subscription model comes delivering services to users for a set fee. If Uber were to take this approach, as Netflix does, I believe it would be more successful for the company. With set base pricing the company would not have to focus on offering deals or lowering prices for a few days or a week to compete with their competitor, Lyft. With this model of earning revenue and profit, Uber, in my opinion, would be the top provider of the service by far. No longer would riders look to competitors for the cheapest ride, they'd already have cheap rides based on a set monthly price of around $40, which can be what one ride ends up totaling sometimes. This new system would attract new users while encouraging current riders to stick to using Uber as their number one choice for a personal ride.
As a frequent user of the company, I would highly enjoy them to stay in business. As a result, I do not want them to fall into the same trap that early "dotcom/dot bomb" companies such as CNET, eToys.com, and Pets.com did. These companies did not choose the right business models for the company and because of that they did not survive. These dotcom/dotbomb companies:
ignored the cost side of the business equation,
did not know how to produce revenue or control costs,
were unable to articulate a clear value proposition at the time.
These companies could teach Uber an important lesson, to not let their company grow too fast at such a high rate. While the company was the most valuable startup worldwide as of 2014, it is still a possibility for them to join these companies if they keep losing money and don't begin to focus on making a profit.
To sum up my discussion, Uber is a great service provider for those who need rides. It offers better and more reliable services than your everyday taxi; it provides a personal ride. The business as of now is profitable, but not as profitable as you would believe. Yes, Uber makes money off of many individuals in need of rides daily, but they also spend a vast amount of their revenue between research and marketing. If they shifted from a merchant business model to a subscription model, I believe this would solve their current revenue issue at hand for the future; leaving them to be the personal, stylish ride of the future.
"Ride in Style" thanks to your personal driver from Uber.
Note to reader: The following is the analytics of my blog and suggested blogs to follow of my classmates.
Blog Analytics
Moving on from the discussion of Uber's business model, I would like to discuss and analyze the viewer analytics of my blog. To stat off with the basic analytics, currently, my blog has a total of 18 sessions with 15 viewers. My page view total is at 24 with 1.33 pages viewed per session. The average session duration is 1:17 with a bounce rate of 66.67%. Lastly, 83.33% of my sessions are from new users.
Some interesting analytics I was able to view were that my readers were not just from the United States. I had two from the Netherlands, one from Puerto Rico, one from Russia, and one from South Korea. I also found that most of my viewers are males interested in the sports world in the mostly younger generation.
The pie chart below shows where my current traffic is reaching my blog from:
With majority of my views coming from direct or referral traffic, my goal is to increase both the social and organic search of my viewers. This could be due to classmates viewing my page or from actual marketers or consumers of the businesses I am following being intrigued in my opinion. To increase my audience by social means, I will share links to my blog via my social media accounts to my friends for them to view and hopefully share with others. To further reach organic search users, I plan on creating unique yet user catching titles that explain the context of my article while also grabbing the attention of viewers.
Recommended Blogs
I follow the blogs of my fellow classmates Felix and Regina. I chose their blogs due to their discussion on some of my biggest interests: music, electronics, food, and beauty/fashion. Their blogs showed to me just how important and necessary digital marketing is this day and age in order to reach consumers. I was also able to see the different tactics marketers are using to reach their markets and make their brands known to potential consumers. Through Regina's blog I was definitely able to see how digital marketing is not just about marketing your product, but informing consumers on your product's uses.
Regina's blog follows the companies SnapKitchen, Lush, and Apple. On her blog, you can see that I commented, "I enjoy how you informed potential consumers such as myself on all the great ways I can learn more about the products the Lush brand has to offer! It's interesting to see how Lush is interacting with their market in different ways." From her blog, I learned other ways that marketers of products are reaching their consumers that differ from the brands I chose to follow. It is interesting to see how different brands reach their consumers through marketing in different ways.
Felix's blog consists of discussion on ASOS, Withings, and Spotify. I've personally interacted with his blog by commenting on it, "I enjoy how you connected the three brands you chose to follow by each of them growing and becoming more successful brands over the past decade." Thanks to Felix's insight, I was able to see just how far businesses are able to succeed through the use of digital marketing.
Below are the links to their blogs. I hope you enjoy them as much as I do!
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