Throughout its whole activity, Uber manages to win its clients’ and drivers’ loyalty, mainly due to its excellent service and comparatively high wages. This is because the corporation developed a unique business model that significantly differs from conventional taxi services. Uber works as a private limousine service, allowing for evading the costly regulatory regime that suggests undergoing strict screening procedures for drivers. In addition, when traditional taxies deal with customers through casual interactions and scheduled appointments, Uber delivers a ride service via the smartphone app linked to drivers. This altogether allows the company to offer a lower price and realize a flexible pricing strategy.
However, from the foundation, the company experiences significant concerns related to federal and international regulations, public behavior, and the relationship with drivers and other employees. For example, “surge pricing” is controversial and the principal irritation for most customers. Its business model can be effortlessly imitated by rivals, which was done by Lyft, Zipcar, Ola, and Grab. Hence, the company should review and correct its public behavior and attitude towards local regulatory rules, drivers, and other stakeholders to improve respect for its brand. The management should also concentrate on enlarging the company’s operations in the markets of the Far East countries, such as China, India, and Singapore.
As a business strategy, Uber uses the sharing economy since it employs IT systems, particularly mobile applications, to provide service and an online rating system for their employees and customers. Uber also relies on the workers that use their own resources, namely, vehicles. Concerning the sharing economy, it is becoming a promising and forward-looking practice, mainly in developing countries, because digital service acquires incremental significance and attention. Furthermore, the current global crisis and an increasing unemployment rate will spur the worldwide expansion and impact of the sharing economy. Thus, economic recession and transition to online ordering may favorably reflect on Ubers’ growth.