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TOPIC:

SERVICE PROMOTION

COMPANY: UBER CAB SERVICES

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S.N0

CONTENTS

PAGE NO.

1.

Introduction

2.

Objectives of the study

3.

Research methodology

4.

Findings

6 - 16

5.

Analysis

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7.

Recommendation

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8.

Appendices

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9.

References

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TABLE OF CONTENTS:

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INTRODUCTION
What is Service promotion?
An initiative taken by the marketing staff of any organization to increase sales for their target
market by using digital media, print media, trade shows, billboards, posters or any of the
channels to enhance their brand as well as attract customers and increase revenues is called
service promotion. Service promotion in todays generation has become very crucial for any
organization as there are many companies fighting for market share and to become the market
leader you have to be innovative and come out with the best promotional strategies. The cultural
perspective has also to be taken into consideration when you are coming out with service
promotion as it is detrimental for your sales. The various service promotion used by uber are
referral schemes, emotional advertising etc.
Sales promotions are the set of marketing activities undertaken to boost sales of the product or
service. There are two basic types of sales promotions: trade and consumer sales promotions.
The schemes, discounts, freebies, commissions and incentives given to the trade (retailers,
wholesalers, distributors, C&Fs) to stock more, push more and hence sell more of a product
come under trade promotion. Sales promotion activities aimed at the final consumer are called
consumer schemes. These are used to create a pull for the product and are advertised in public
media to attract attention. Maximum schemes are floated in festival times, like Diwali or
Christmas.
Product and Services promotions are very similar in nature. In product promotion the benefits of
using a product are described and emphasis is laid on how it will improve the consumers life. In
service promotion the value and benefits of opting in to a service are described. On the whole,
there isn't much of a difference except that one is tangible and the other intangible.

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OBJECTIVES OF THE STUDY


This study was conducted to find out about the following issues:

Competition and challenges faced by Uber currently and in the future in India and

globally.
Promotional schemes and campaigns used by Uber in India.
Service failures occurred in India or abroad and how did they manage to retain the

customers by providing Service Recovery.


Strategies being followed by Uber in order to differentiate from its competitors

worldwide.
How did Uber manage to maintain its brand value and recall through strategic tie-ups.
How the service quality is being managed globally.

RESEARCH METHODOLOGY
Exploratory Research:
An Exploratory Research is defined as the initial research, where a researcher has an idea or has
observed something and seeks to understand more about it.
This project on service promotion has been done to explore the objectives and to lay the
groundwork that will lead to future improvements based on our studies.

Data Collection:
The data has been collected using primary sources by means of a research questionnaire which
was answered by 133 respondents and secondary sources, i.e., data that has been already
collected and readily available from other sources, like online portals1 .

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FINDINGS
About Uber
Travis Kalanick & Garrett Camp established Uber as Uber Cab Received venture funding from
First Round Capital and super angel investors in Silicon Valley Raised $32 million from various
investors, like Goldman Sachs, Menlo Ventures, and Bezos Expeditions Uber Apps for iPhones
and Android phone introduced Raised more than $11.5 million from Benchmark Capital.

How it works?
Uber uses a smartphone application to accept ride requests, & then redirects these trip
applications to their chauffeurs. In some towns, if Uber cab is travelling at more than 11 mph (18
km/h), then the payment is decided upon distance, else the price is decided upon time basis. On
reaching the destination, the entire fare is automatically billed to the customer's credit
card/Paytm/cash. Uber has categorized its high prices as premium being paid by the travelers as
its service is reliable, punctual as well as comfortable. During festival season such as Halloween,
New Year's Eve, or severe weather conditions, Uber reserves rights to increase its prices, alluring
more business.

Uber App:
Uber app is free from apple app store, Google play store, & blackberry world. Once downloaded,
register & login. Choose out of five vehicle types as options. Spot your pick up location, enter
your destination and select mode of payment.

Who drives for Uber?


Uber requires that its drivers pass a DMV and background check. They also must have their own
car and it must be insured. There is a personal inspection of the vehicle to check for exterior
damage, cleanliness, wear and tear. Uber drivers are free to operate with other travel and tour
operators and pick up Uber customers only when free, thats why we dont see any cab bearing
an uber logo. Because of these minimal requirements, the service attracts a large array of people.

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Uber utilizes a rating system as a way of encouraging good behavior on behalf of passengers and
drivers. Both parties can rate one another on a five-star scale at the end of a ride.

Other taxi cab services in India:


Ola Cabs
OlaCabs, commonly known as Ola, is an Indian online transportation network company. Ola
started as an online cab aggregator in Mumbai, now based out in Bangalore.
The company has expanded to a network of more than 200,000 cars across 85 cities. Ola Auto
expanded to cities like Delhi, Pune and Chennai starting December 2014. In December 2015, Ola
expanded its auto services in Chandigarh, Indore & Jaipur. Ola was valued at $5 billion as of
September 2015.
Ola provides different types of cab service ranging from economic to luxury travel. The cabs are
reserved through a mobile app. This cab service supports both cash and cashless payment options
with Ola money.
The company also engaged in multiple partnerships to strengthen its business, like

Strategic partnership with Chinas DidiKuaidi, US-based Lyft and Malaysias GrabTaxi,
which will allow passengers to book rides on any of these four services using just one

app.
Partnership with customer-based chat services company, Haptik, which will allow users

to book Ola cabs through instant messaging on the Haptik mobile app.
Partnership with MapMyIndia.

Meru Cabs
Meru cabs was founded by Neeraj Gupta in Mumbai on April 2007, by raising funds against an
equity stake in the company from India Value Fund (IVF), which is a private equity fund with a
corpus of over US$1.4 Billion. On 2 February 2014, Google Now and Meru Cabs announced a
partnership to provide instant alerts to customers. Meru cabs partnered with French taxi service
provider Taxis G7 to provide taxi services globally.

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Meru Cabs is a taxi aggregator company based in Mumbai, India. It provides cab booking
facilities through calls, website or through their mobile application and payment through cash,
card or wallet christened Cab Wallet. Meru Cabs integrated their cab service with Google Now
which will send passengers remainders for cab pickups, alerting them if they wish to book a cab
based on their location and other information through Now Cards within the Google app.

Other top taxi cab services globally


Didikuadi
DidiChuxing, formerly DidiKuaidi, is a Chinese transportation network company headquartered
in Beijing. It provides vehicles and taxis for hire in China via smartphone applications. Formed
from the merger of rival firms DidiDache and KuaidiDache (backed by the two largest Chinese
Internet companies, Tencent and Alibaba respectively).
DidiChuxing is an application where taxis, premium cars and designated drivers can be hired via
smartphone. It is similar to apps such as GrabTaxi in Southeast Asia. Alongside its basic taxicalling function such as the ability to carpool, hire premium cars, hire designated drivers and use
a special service for passengers with disabilities and its closest local competitor is uber.

Lyft
Lyft is a privately held American transportation network company (TNC) based in San
Francisco, CA. Launched in June 2012 by Logan Green and John Zimmer, the company's
mobile-phone application facilitates peer-to-peer ridesharing by connecting passengers who need
a ride with drivers who have a car and here also the main competitor is Uber.
Lyft offers three types of rides within the app:

For a discounted price, Lyft Line will match passengers with other riders if they are going

in the same direction.


Lyft is the original offering that matches passengers with nearby drivers.
Lyft Plus will match passengers with a six-seater car.

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Grab taxi
Grab (formerly known as GrabTaxi) is a mobile e-hailing application available in six countries. It
is an automated smartphone based booking and dispatch platform for the taxi industry in
Southeast Asia, available in Malaysia, Singapore, Thailand, Vietnam, Indonesia and the
Philippines. Their vision is to revamp the Southeast Asian taxi industry, making it a safer and
more efficient means of transport for the Southeast Asian communities.
GrabCar, GrabCar+ and GrabBike services are available on the same platform as GrabTaxi,
which in turn, offers the GrabTaxi users a transportation option when they are travelling in any of
the 6 countries where GrabTaxi operate in.

SERVICE PROMOTIONS OF UBER


Instead of spending crores of marketing money on pushing traditional campaigns, Uber instead
decided to spend on giving the consumers a firsthand experience of their service. They were
aware of the notion that nothing would attract the Indian consumer more than a discount or
special offer on a service they needed and thus decided to go heavy on their referrals scheme.
Since then Ubers referral marketing has evolved massively by coupling it with various other
offers like heavy discounts and free rides.

Some of the different promotional schemes and campaigns used by Uber in


India are:
1. Referral Schemes:
Ubers first thought was to target the corporate sector by asking customers to become Office
Heroes by referring their non-Uber using co-workers and friends. Under this scheme both the
persons would get a free ride of up to Rs. 250 each, and if an existing customer referred 10, 25 or
50 people he would get the same number of rides free as an extra bonus. This was unlike other
schemes under the same name which would only benefit the person referring, so it was a winwin situation for both parties. This is one of the major contributors to the widespread success of
Uber in India. Also they didnt fall into the trap of wanting to collect more user data and gain

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access to social accounts at the expense of their referral program making it a simple and quick
process for the consumers.

2. Festival Marketing:
Festivals have always been a great opportunity for brands to promote their products and services
and milk the happy, guilt free splurging phase of Indian consumers. Uber used this to their
advantage and decided to become available for their customers when most needed by having
unique promotional campaigns that banked on the popularity of these festivals to position
themselves in the minds of consumers and boost sales. Some examples of these are:

Delivery of kites on MakarSankranti, colors on Holi and cupcakes on RakshaBandhan


Special offer for a makeover for mothers on Mothers Day
A package deal on Valentines day including a ride in an Uber chopper followed by lunch
On the 65th Republic Day, Uber offered its users in Delhi a 65% discount on cab rides
Free rides for new users in Kolkata on the day of Durga Puja

3. Local connect with consumers:


Uber is trying to catch the pulse and characteristics of every city. Brands need to be more human
for the consumers to connect and Uber is doing just that by catering to consumers, city wise.
India is known for its vast diversity and Uber understood that just a single marketing or
promotional strategy will not work out, so it came up with different promotional schemes to cater
to people from different cities. Some examples of this are:

Discounts for everyone travelling to the Mumbai Business Week


Luxury cars for free for everyone attending the Vibrant Gujarat Summit in Ahmedabad
Free pick up and drop service to the Chinnaswamy Stadium in Bangalore
Celebrated Chandigarhs 48th Birthday by giving a 48% discount on rides.
Discounted rides to IPL matches and other key events

4. Strategic Partnerships:

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After gaining popularity among the masses with its promotional discounted and free rides, Uber
needed to do something else to stay in the game and establish itself as an innovative player, and
so they started getting into partnerships with other popular products and services to boost its
brand image. Some of the more important ones are listed below:

Uber tied up with Zomato globally and integrated with their app to offer a seamless

experience for foodies and riders alike.


It associated with Book My Show as their official logistics partner for the T20 Cricket
season. Customers booking tickets for matches with the Book My Show app would

receive two promotional free rides.


It tied up with MINI as part of a promotional campaign that saw it offer free 15 minute

rides in the new MINI in select cities for a limited period.


It integrated its payment system with PayTM and gave away five free rides to users who

linked their account with the new wallet system.


It teamed up with ITPL (International Premier Tennis League) and offered riders to meet

up with tennis stars like Rafael Nadal, SaniaMirza and others.


It partnered with food delivery app Swiggyand provided surprise food packages in some
cabs as part of promotion.

Ubers most brilliant Ad campaign globally:


Uber + Spotify - The company teamed with Spotify to enable customers to listen to their
Spotify playlists while riding.
Santas little helper - Every Christmas, Uber eases Santas workload by turning into
UberSleigh. Uber cars have visited more than a dozen cities around the world to collect
toys for the needy.
The writings in the sky On Valentines Day, Uber launched UberSky, an on-demand
skywriting service.
Reducing the carbon footprint:Environmentally friendly service
Say I love you with uber: Uber made it easy to say I love you by arranging for
delivery of roses to their consumers loved ones.
Summer treat - With a simple tap of the app, users could order ice cream to their
doorstep within minutes.
Transportation for wedding - Uber teamed with Style Me Pretty to offer transportation
for weddings. Users got customized packages based on their wedding details.
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UberSloep promotion - Users in the Dutch capital could request a canal boat to ride
around in.
Ride with a celebrity - Uber gave customers the chance to request a very special ride
from Optimus Prime & Uber offered one lucky customer in Amsterdam the chance to be
picked up in a Bentley by celebrity DJ Afrojack.
Though several cities have challenged the company with regulations and lawsuits, Uber is still
the transportation of choice for millions of people. Perhaps its because users who use the Uber
app will have a chauffeured car pull up within minutes, or maybe its because the company uses
one of the most creative marketing strategies out there.
In fact, the expression Im going to Uber has become a part of the global vernacular, said in
different languages. The modest car-service startup has exploded into a roughly $40 billion
company, serving 53 countries worldwide.

COMPETITIONS FACED BY UBER:


Global Competition
Uber had its inception from San Francisco California in 2009. In its home nation competition
comes from Lyft which is also a taxi sharing app. Uber is already losing billions of dollars in
china to compete with Chinese taxi giant Didi Kuaidi backed by Tencent holding and Alibaba
holdings group according to Reuters report. The Chinese company now operates in 400 cities and
has passed breakeven point in many cities. Uber has tough competition for the biggest market in
the world in China from Didi Kuaidi a merger of two biggest taxi firms Didi Dache and Kuaidi
Dache.
In the other Southeast nations Uber has a major threat from Grab formerly Grab Taxi. Grab has
also tied up with Lyft and Didi Kuaidi to expand its business from southeast nation to other
continents as well. In the United Kingdom 8000 Black cab drivers protested against Uber for
unfair competition. The black cabs in UK has a strong union and political factors are also
becoming a burden for Uber in UK.

The Indian Scenario


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In India Uber is facing major threat from Ola and Meru cabs, Ola has already acquired Taxi for
sure for $200 million dollars. In India the organized market is dominated by homegrown Ola
cabs having 60% market share and Uber having 5% market share. Ola has strong backers from
Tiger capital, Sequoia capital and Accel partners all huge players in the financial landscape. The
Indian Taxi market is estimated to be around 8 billion dollars hence there is a huge opportunity
for growth in this market. Hence Uber has still a long way to go both in China as well as India in
capturing the Taxi market. To compete with Uber, Ola cabs has tied up with Grab from Southeast
Asia, Lyft from USA and Didi Kuaidi from China hence a customer can book a taxi from any of
these apps for a Taxi in any of these countries.

How does it differ from its competition?


Uber raises a lot of funding from big financial players like Microsoft corp, Google ventures, Jezz
Bezos and Ratan Tata. This type of funding helps Uber to follow a loss leader strategy and weed
out the competitors from the industry. Uber is also planning to invest $1billion in India to capture
the huge market that India has. Uber uses a dynamic pricing strategy it changes the prices on
weekends on festivals and on days where the weather is bad. Price wars is another strategy that
Uber uses to compete with global competitors who are joining hands to beat Uber. The Taxi
sharing company has huge potential for growth and there is tough competition for market share
however very few companies are able to survive in this cutthroat competition, and Uber is one of
them and will remain so in years to come.

SERVICE FAILURE AND SERVICE RECOVERY OF UBER


Service Failure
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Service Failure that have happened and can happen in Uber:


Uber charging cancellation fee just after five minutes of booking the cab. That becomes a problem
in India, as the Indian cab drivers are usually 10 minutes late and during that time if the customer

in his urgency cancels Uber cab then also he has to pay the cancellation charges.
Unknown technical faults due to which customers have to pay twice or sometimes even four or

five times more than the actual fare.


Uber being unable to establish its USP in India of picking and dropping off the customer from his

specified location.
Unnecessary delay in the timing because of police stopping the drivers for a random check
(because of the Delhi rape case). Due to this the customers have missed their flights and trains in
multiple incidents.

For example: A Minnesota woman was charged for multiple Uber rides, when she hadnt even
used the Uber app in years. Her Uber account was showing that she had been travelling around
on the same route multiple times, which costed her $1342. The Uber officials did refund her the
money and said that, While it looks like that your account was impacted, but our team has
investigated and found no evidence of a system-wide breach at Uber.
The customer is still unsatisfied with Ubers service recovery as neither did they contacted her
through phone and informed her about whether they are looking into the matter nor did they give
her a guarantee or a reassurance that the same thing wont happen again.

Service Recovery
One of the major events of service failure that has occurred in the history of Uber was in Delhi,
India. In the case, a young lady aged 27, was allegedly raped by an Uber Cab driver in Gurgaon
region of North Delhi. The case hit the headlines and became a nationwide outcry, due to which
Uber had to stop its services in Delhi as per the orders of the Supreme Court.
In a statement released by the company, when the incident came to light, Uber spokeswoman
Evelyn Tay said: "Safety is Uber's highest priority and in India, we work with licensed driverpartners to provide a safe transportation option, with layers of safeguards such as driver and
vehicle information, and ETA-sharing to ensure there is accountability and traceability of all trips
that occur on the Uber platform,"
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Uber CEO Travis Kalanick in a statement said, "Our entire team's hearts go out to the victim of
this despicable crime. We will do everything, I repeat, everything to help bring this perpetrator to
justice and to support the victim and her family in her recovery." He also added, "We will work
with the government to establish clear background checks currently absent in their commercial
transportation licensing programs. We will also partner closely with the groups who are leading
the way on womens safety here in New Delhi and around the country and invest in technology
advances to help make New Delhi a safer city for women."
As promised, Uber did coordinate with the Government and made sure that this type of incident
doesnt get repeated. In order to do so they increased their precautionary measures before
choosing their driving partners. What happened with the victim couldnt be reversed but they did
reach at a settlement with the family of the victim at an undisclosed amount.
Why this incident can be considered to be a service recovery is because, despite the protests
against the company and even requesting the government to shut down the companys operations
throughout the country they still managed to survive and convince their customers about the
safety options and delivering satisfactory service to them.

The questionnaire consisted of total of 5 questions and was responded to by 133 people out of which
males constituted 51.9 % and females 48.1 %.
The findings from the collected data are as below:

90.1 % respondents said they used cab services


The most preferred method of booking cabs is through mobile apps (80.5%)
Out of 6 factors, the most appealing benefit for respondents was the ability to Track the cab

driver (55.6%), followed by Safety (45.9 %).


The most preferred cab service was Ola with 48.1 % respondents rating it highest, followed closely
by Uber with 46.6 %, giving it close competition.

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ANALYSIS
Uber does make the experience as different as possible and it is the progressive part about Uber
that makes its customers chooses it over cabs. Even though the customers could accomplish the
same feat by hailing a cab, the Uber experience is different for a number of reasons. Firstly the
hailing process is much simpler. No waving at cabs driving by. No haggling over prices. Just
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opening an app and clicking a button. Secondly, while the quality of vehicles that Uber drivers
can use has decreased from a maximum of 10 years old to a maximum of 15 years old, these
vehicles are still by in large nicer than the taxi cab alternative. The clientele that drives for Uber
is higher class than taxi cabs and this makes riders feel more comfortable. Lastly, the price is a
differentiating factor. Uber saves big time when it comes to overhead and they pass this on to
their customers as savings which helps to differentiate their service from taxis.
The employees also enjoy flexible hours of operation, which is one of the main factors that
attract more employees. Their policy of allowing employees to operate with other cab companies
also helps their employees earn more.
Uber primarily makes use of referral schemes as its main promotional strategy in India. This is
further supplemented by means of various discounts and schemes it offers on a regular basis
during festivals and events. Globally, Uber makes use of the one size fits all approach where one
promotional campaign is run across different cities during the time of festivals and events.
Whereas in India, it has tried to establish a local connect with the consumers by coming up with
unique promotional campaigns for different cities in order to cater to the vast diversity that exists
within the country. Also Uber in India has used strategic partnerships to a great level in order to
gain popularity among the youth segment.
Uber has also consistently been trying to make its expansion globally. In every nation it has
faced local competition and has been successful by weeding out most of the competition. Uber
uses a loss leader strategy in whichever nation it goes, it also learns about the culture and makes
its promotions based on emotional advertising. In India Ola has been able to match with uber and
there is intense competition between them. Uber does have an advantage of being a foreign entity
with huge backing by big financial players but Ola is also not lagging behind and getting its own
sources of funding. Uber faces competition from Didi Kuaidi, Lyft, Grab Taxi and various other
organizations who are joining hands to reduce the growth of Uber. Hence Uber has to
continuously come out with strategies to outmaneuver competition if it wants to stay on top of
the Taxi industry.
Uber Cabs, although very successful in other countries, couldnt achieve the same success in
India because they didnt pay much attention to screening their cab drivers details and verifying
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them.Moreover, they werent able to maintain and upgrade their apps so as to enable the
company to know about the location of the cabs and avoid any mishaps.

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RECOMMENDATIONS

Due to upcoming cab services like Uber, Ola, etc., which have gained great popularity among
passengers, & also government provided transport services like buses, metros, etc., autorickshaw drivers are slowly becoming obsolete & running out of business, therefore Uber can

revive their Uber Auto & provide employment to these auto drivers.
Uber should allow its customers to pre-book cars so as to avoid inconvenience during peak

hours.
Uber can promote their 2-wheeler services especially among college students due to its low

charges & convenience.


Uber can also start using female drivers during the day, so as to support feminism; and use

#uberher to promote this initiative.


Uber can also come up with a luxury car section for the richer & higher class of society.

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APPENDICES
1. Uber growth in India

2. Different cab models to cater to everyone

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3. Research Questionnaire for collecting Primary Data:


1. What is your gender?
Male
Female
2. Do you use taxicab services?
Yes
No
3. How do you generally book your taxicab?
App
Phone call
Online
Others
4. Whether you have used a taxi app before or not, which of the following benefits appeal to
you? (Select all that apply)
Dont have to call
Dont have to signal to a taxi in the street
Payment via the app
Tracking the driver
Taxi driver ratings on the app
Safety
5. Which taxicab service do you prefer the most?
Uber
Ola
Meru
Sky cabs
Others (Please specify)

4. Data collected from Questionnaire:

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REFERENCES

http://bradlongmba.blogspot.co.uk/2015/03/ubers-product-differentiation.html
http://tofurious.com/marketing-strategy/uber-competitive-strategy-vs-taxi/
http://www.business-standard.com/article/management/uber-gets-into-its-india-gear-

115072600731_1.html
http://www.businesstoday.in/magazine/cover-story/india-taxi-market-war-heats-up-ola-

cabs-uber-strategy-leaders/story/222542.html
http://techcrunch.com/2013/08/30/as-uber-drives-into-india-its-shifting-its-emerging-

market-strategy-up-a-gear/
https://growthhackers.com/growth-studies/uber
http://hooklineandclincher.in/uber-marketing-strategy-india/
https://salt.agency/blog/ubers-marketing/
https://urbanful.org/2015/01/21/17-of-ubers-most-brilliant-ad-campaigns/
http://hooklineandclincher.in/uber-marketing-strategy-india/
https://newsroom.uber.com/
http://qz.com/630153/uber-starts-motorbike-taxi-service-in-india-ola-follows-

immediately/
http://www.livemint.com/Companies/juHY7ITCICW6jrrYODZ7oJ/Uber-launches-

cheaper-brand-UberX-to-compete-with-Meru-Ola.html
http://www.exchange4media.com/advertising/inside-the-ola-vs-uber-marketing-warzone_62697.html

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