Does the Uber – ification of Everything Provide True Mobile Value?
When we think of mobility, we think of convenience, accessibility and ease of use. I expect all my mobile experiences to be seamless and bite-sized. To this end, consider the current trend towards “push button” apps like Uber. Tap a button and a car magically shows up! It’s a seamless experience for the user on the front end, and Uber handles the countless complexities of yield management, dispatching, etc. on the backend. But does Uber – ification provide true mobile value? Or are we all just being taken for a ride. Let’s explore.
Apart from the experience itself, one has to ask if adding a technology layer to a service truly adds value? Uber didn’t revolutionize the way you get from point A to point B. It’s no hyper-loop. At least not yet. Does adding a tech layer on top really add enough value to be commercially viable in the long term? Or is it better to reinvent the underlying processes and then enhance them with technology?
Similarly, when evaluating the Enterprise, it’s always important to examine the business processes as well as the mobility goals. Never just layer an app on top of existing processes. Rather, examine how the processes can be improved in conjunction with mobilizing those processes to drive greater value, whether via a top-line increase of revenue or a bottom-line increase in operational efficiencies.
From a quality perspective, Uber is in a race to the bottom. This is likely a force of the market. What began as a premium black car service has devolved into a game of driver roulette. These days you’re never sure if you’ll be matched with driver who is inexperienced or unfamiliar with the city. Anecdotally, as supply has flooded the market, quality has suffered.
The fact Uber subsidizes the price of rides—and isn’t generating a profit—is often cited as proof the current market can’t support Uber at rational costs. As in this recent Business Insider article from Jim Edwards.
So it really comes down to this: is Uber, by deploying a mobile app (and related services) really adding value to the equation of accessing transportation, and is it enough value to generate a profit in the longterm? Or is it simply a leader in the ongoing trend of applying a tech layer onto a legacy service offering with no true reinvention?
Take Homejoy for example: the Uber of house cleaning. They closed down after being unable to secure additional funding rounds to sustain their business. Because when it comes to home cleaning, most people are cleaner-loyal and utilize the same cleaner each time. So what value does the app provide beyond the first match? Things look even bleaker from the cleaner’s perspective. Why would a cleaner give up a percentage of their income to some tech company when that person could easily post on Craigslist and schedule appointments for free?
Regardless, the trend is exploding. These days, there’s Washio for laundry, Munchery for food and Swifto for dog walking, to name but a few examples.
When considering these industries and their product or service offerings, the question to ask is: are consumers willing to pay a premium for convenience? And are they experiencing enough value to justify the cost? You can only buy customers for so long before you deplete your funding.
Mobility really adds value when company interactions are improved through its addition. Take Starbucks for example. They didn’t bother pursuing a distinct mobile coffee ordering business. Instead, they extended their services with technology that allows consumers to pre-order a latte from an app. This improves operational efficiency and reduces the burden on the baristas. Note this isn’t a separate coffee-ordering startup that has to layer its own customer acquisition costs, and operating/profit model on top of an established business. Rather, the app simply approaches the existing business from a different angle, transforming how consumers interact with the business and adding true value for the consumer.
Want to learn more about user-engagement strategies at Uber? Check out our recent podcast with Uber Sr. Design Researcher, Lisa Handalian.
Interested in learning more about how you can reinvent your Enterprise business processes through mobile technology? Reach out to Propelics to learn more. Let’s get started.