The problem with Uber is they refuse to pick a strategy

Posted on Posted in How to Guide for Marketers

At the core of strategy is making choices. Back in business school, I had a strategy professor who said, “It’s all about choices” about 30 times a class. Whenever you are faced with options, find a way to narrow down your choices and pick the best path for your brand. 

With Uber, they seem willing to refuse to make any choices–preferring to try to be everything to anyone. Uber has failed to choose a core strength to build behind, they have failed to cultivate a relationship with consumers, they have hung onto their disruptor strategy too long, and failed to build an aligned culture that can deliver a superior consumer experience.

We use our ThinkBox and PlayBox to manage your brand strategy

I want to introduce you to my ThinkBox concept, which I have borrowed from sports. For instance, in golf, using a ThinkBox forces you to consider everything you are facing before taking the shot. Look at any lakes or bunkers in the way, the wind condition, or how well you are playing that day. Then, decide on your shot strategy. As you move to a PlayBox, visualize the ideal shot, think and feel your way through the mechanics of your swing, and trust you are making the right shot. Do not over-think the strategy during the execution.

With your brand, you should use a Strategic ThinkBox, to get a 360-degree view of the situation, before taking action. Consider your brand’s core strength, the bond you have with your consumers, your brand’s competitive position, and your brand’s business situation. Once you have completed your thinking, use the Execution PlayBox to see the ideal execution, think and feel your way, then trust your instincts.  

The four questions in our Strategic ThinkBox

As I created the Strategic ThinkBox, I made it so that each of the four questions uses a forced choice to make decisions, where you must focus on only one possible answer for each question. 

  1. What is the core strength that will help your brand win?
  2. How tightly connected is your consumer to your brand?
  3. What is your current competitive position?
  4. What is the current business situation your brand faces?
  1. Start with your brand’s core strength. Decide which of four choices you will lead with: product, brand story, consumer experience or price. Your core strength will change your entire strategy, including the brand messages and the focus of your investment. Below, I show a unique process for how to choose your brand’s core strength.
  2. Next, you have to look at your consumer strategy. Start by determining where your brand currently sits on the brand love curve, whether your brand is unknown, indifferent, like it, love it, or at the beloved stage. The goal is to tighten the bond with your consumer and move them from one stage to the next. You can use brand funnel data, the voice of the consumer, and market dynamics to determine where your brand sits on the brand love curve. In my book, I outline clear game plans for each stage.
  3. Regarding the competitive strategy, you must choose from one of four different types of competitive situations you find your brand operating within. The power players are the dominant leader in the category and take a competitive defensive stance. The challenger brands have gained enough power to battle head-to-head with the market leader. The disruptor brands have found a space so different they can pull consumers away from the significant category players. Craft brands aggressively go against the category with a niche target market and a niche consumer benefit. They are small and stay far away from the market leaders. Each competitive situation leads to different strategy choices.
  4. A brand must look at the situational strategy, which starts with understanding your brand health, looking at both internal and external factors. Choose one of four potential situations: whether you keep the momentum going, face a business turnaround situation, realign everyone behind a strategy, or your brand is a start-up. Each situation leads to distinct strategies and leadership styles to deploy. 

Uber refuses to narrow choices on strategy

What is Uber's core strength

To be loved, brands must know who they are and then stand with pride, conviction, and confidence. Too many brands try to have a few core strengths cluttering up their brand positioning, so they end up with no real perceived strength that stands out. Our core strength model forces you to select one of four possible options for you to win with: product, brand story, experience, or price. For many marketers, their immediate response is an urge to pick two or three core strengths, believing the myth that having many strengths makes your brand stronger. A focus will make your brand stronger.

Here is the game I have created to help choose your brand’s core strength. 

  • Using the diagram below, start with four chips. You must place one chip where you believe you have the highest competitive advantage to win. 
  • Then put two chips at the medium level that backs up and supports the core strength. 
  • Finally, the game forces one chip to be at the low end, which is almost a throwaway weakness that will not be part of the strategy. 

It is a great game to try with your team, as it sets up a great debate among your team members.

Having created this model, and used it with over 100 brands, I’d say Uber should focus on being the best ride experience, including the simplicity of ordering through the app, ease of payment and billing for the business rider, the high quality drivers who provide an estimated time of arrival, and take pride in their cars.  Uber could easily use the superior customer experience to command a significant price premium. I’d pay extra.

lyWhen the consumer experience is your brand’s lead strength, the strategy and organization should focus on creating a link between your culture and your brand. Your people are your product. Use your brand purpose (“Why you do what you do”) and brand values to inspire and guide the service behaviors of your people. Then build a culture and organization with the right people who can deliver incredible experiences. Experience-led brands need to be patient with how fast they build the brand, as the quick mass media approach might not be as fast or efficient as the product-led or idea-led brands. The most effective communication tools for consumer experience-led brands include word of mouth, earned media, social media, online consumer reviews, the voice of key influencers, and consumer testimonials. These brands can make a mistake if they put too much emphasis on price, which can diminish the perceived consumer experience. 

Instead, Uber focuses on their app product and driver network, and they obsess about being a lower price than taxis. Being lower price is a fair entry strategy to gain the attention of the marketplace. However, hanging onto this lower price has forced Uber to pay their drivers poor, which inhibits the delivery of a high quality experience. It is estimated that Uber drivers make between $1-5 an hour, certainly not a salary that will help Uber attract the best drivers. Instead they now getting desperate drivers who cannot deliver the expected high quality experience at all. 

By not taking the experience positioning space, Uber has given this up to Lyft, who is now trying to deliver a better experience at a price premium. Moreowver, it also opens up business consumers to go back to their favorite limo companies, to get the exceptional experience they desire.

Always remember, when you fail to define your brand, you run the risk that your competitors and consumers will define you. And, you might not like it.  

How tight is the bond with your consumers?

Very early on, Uber generated a lot of love with consumers. It was such a disruptive product, they seemed light years ahead of the taxi market. What did they do with all that brand love? Nothing at all. 

At the like it stage, the strategy is to separate the brand from the pack, creating happy experiences that build a trusted following over time. Only after they trust the brand, they begin to open up. At the love it stage, the focus shifts tightening the bond with the most loyal brand fans. At the beloved stage, the strategic challenge is to create outspoken, loyal fans who are willing to whisper to their friends on the brand’s behalf.

Uber is so bad with the consumer, I would go as far as to call Uber consumer-oblivious. They treat all consumers the same–relatively badly. 

  • While the internet has allowed consumers to rate brands, it seems downright weird for a brand like Uber to be rating consumers. Who is paying who here?
  • When do consumers need an Uber the most, during peak hours, Uber charges surge prices that moves them into a significant price premium to a cab.  
  • There is relatively no real benefit to a consumer in becoming a regular Uber user. If you use Uber four times a day every day, you will be treated the same as a new consumer. 

Uber should be cultivating a tight bond with their most loyal consumers, and use that power to bulid their brand.

Uber should be able to leverage their power with consumers to build a better relationship with every city hall, and airports who will want to do what’s popular with consumers. Instead Uber has gone to war with city hall and airports. 
 
With high net promoter scores, Uber should be able to leverage word-of-mouth or social media recommendations, and positive online brand reviews (Yelp or Trip Advisor) to influence new users. Brands at the love it stage must look for unique ways to reward consumers and further tighten their bond with their most loyal brand lovers. By not treating your consumers special, you begin acting like a commodity, and will be treated that way by consumers. As consumers are not treated special, and as the experience begins to decline, Uber runs the risk of losing these brand fans to other, better options. 

Uber should have shifted from a disruptor to a power player

Power players lead the way as the share leader or perceived influential leader of the category. These brands command power over all the stakeholders, including consumers, competitors, and retail channels.

Regarding positioning, the power player brands own what they are best at and leverage their power in the market to help them own the position where there is a tie with another competitor. Owning both zones helps expand the brand’s presence and power across a bigger market. These brands can also use their exceptional financial situation to invest in innovation to catch up, defend, or stay ahead of competitors. Power player brands must defend their territory by responding to every aggressive competitor’s attacks. They even need to attack themselves by vigilantly watching for internal weaknesses to close any potential leaks before a competitor notices. Power player brands can never become complacent, or they will die.    

Uber came in with a successful disruptor strategy that completely rattled the taxi market. However, they never have transitioned into a power player position, where they can leverage that power with various stakeholders.

Uber has an opportunity to own an easier consumer experience that allows consumers to feel in control of their urban travel. They can own the following benefits:

  • Easier to call for a ride
  • Easier to track/control when your car will be arriving
  • Easier to pay and organize billing to keep you in control
  • A superior in-car experience
These are the main benefits taxi consumers are looking for. While lower price was a fine entry point to separate consumers away from taxi cabs, once they established that, Uber should have gone away from the lower price.

What is the situation the brand faces?

Before moving towards a plan, you must fully understand the situation you face. Each year, conduct a deep-dive business review to assess the health of your branded business. A smart brand strategy is a smart business strategy. You are running a live business, with a need to drive sales, manage costs, and produce profits. Without addressing the competitive and consumer factors you face, all your great strategic thinking will come collapsing down around you.  

Uber keeps acting like a startup when they should realign

From the outside looking in, Uber appears to have a toxic culture. A brand like Uber needs a consistent delivery of the brand promise. Issues arise when the brand promise shows up inconsistently across the advertising, in-store, new products, the overall consumer experience. It creates a confused and cluttered mess in the marketplace. You do not want the team behind the scenes of the brand moving in different directions.

When different functions operate in silos, you see the marketing and sales team each delivering their distinct brand messages, and the product development team invents products in a lab without any direction from brand or input from consumers. Internal silos among functions behind the brand. Conflict over action plans. Confused messages.  

Uber needs to realign the team by employing a cross-functional team to build a new brand positioning, an organizing brand idea, and a brand plan to get everyone on the same page. Build a shared vision, purpose, values, strategies, and execution. Uber has had significant issues at the leadership level, many of the executives have exhibited such ego-driven statements they appear oblivious to developing a culture that can deliver the desired consumer experience. The leadership style Uber needs to engage is a participative leadership style that will bring everyone together to listen to all points of view and unify them under a shared plan. Uber needs a leadership that can express cohesion and consistency across all consumer touchpoints. 

Uber has failed to choose a core strength to build behind, they have failed to cultivate a relationship with consumers, they have hung onto their disruptor strategy too long, and failed to build an aligned culture that can deliver a superior consumer experience.

This type of thinking is in my book, Beloved Brands

Learn how to think, define, plan, execute and analyze

  • You will find strategic thinking models and examples for each of the four strategic thinking methods, looking at core strength, competitive, consumer, and situational strategies. 
  • To define the brand, I will provide a tool for writing a brand positioning statement as well as a consumer profile and a consumer benefits ladder. I have created lists of potential functional and emotional benefits to kickstart your thinking on brand positioning. We explore the step-by-step process to come up with your brand idea and bring it all together with a tool for writing the ideal brand concept. 
  • For brand plans, I provide formats for a long-range brand strategy roadmap and the annual brand plan with definitions for each planning element. From there, I show how to build a brand execution plan that includes the creative brief, innovation process, and sales plan. I provide tools for how to create a brand calendar, and specific project plans. 
  • To grow your brand, I show how to make smart decisions on marketing execution around creative advertising and media choices. When it comes time for the analytics, 
  • I provide all the analytical tools you need to write a deep-dive business review, looking at the marketplace, consumer, channels, competitors and the brand. Write everything so that it is easy to follow and implement for your brand.

You will learn everything you need to know so you can run your brand. My brand promise is to help make you smarter so you can realize your full potential.

You can find Beloved Brands on Amazon, Kobo and Apple Books

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