Uber Integrated Marketing Campaign
Executive Summary
Uber is currently facing a marketing problem due to the existing bad reputation it has in the market. Uber’s bad PR is caused by drivers’ misbehavior and inexistence of ethical standards. This paper aims to explain the marketing tools that will help Uber solve this harmful PR problem. Three marketing tools, namely SWOT analysis, pricing strategy, and promotion campaign strategies will be used to provide Uber’s executive management with the best recommendations on how to easily fix and recover from the bad PR effects. The paper will recommend that Uber capitalizes on its strengths to convince the world market that it is still the best company in the cab industry. Also, the paper will recommend that Uber explores and exploits all potential opportunities into the market to steer growth and to improve its customer relationships. In the paper too, Uber will be advised to address all sexual harassment and bad PR scandals, which are contributing to its loss-making and customer disconnection to the firm. Also, the paper will recommend that Uber develop proper relations with its employees to prevent them from shifting to competitor firms like Lyft, for this is the surest strategy of ensuring employee and customer retention.
Marketing Tools Useful in Solving Uber’s Bad Reputation
Uber can easily fix its reputation. Despite Uber being subject to a greater spotlight and scrutiny for misbehavior and lack of ethical standards, the strength of its brand can help it recover swiftly from the negative PR if the problem is well-addressed (Zhuo, 2015). Uber’s negative PR comes in the form of viral videos, tweets, and sensational story-lines, with the company being accused of sexual harassment, insensitivity and opportunism, a culture of sexism, and bad leadership from the top (Isaac, 2017). Uber’s fast growth and position in the taxicab industry gives it substantial leverage to bounce back from negative PR and reclaim its top spot in the market once it responds to its ongoing PR concerns appropriately. Uber’s new CEO, Dara Khosrowshahi, steps to manage the PR crisis troubling the company’s reputation all over the world (Vanessa, 2019). For Uber to restore its public reputation, it would need to launch new, unique and advanced SWOT strategies, pricing strategies, and market promotion campaign strategies.
SWOT Strategy
In the SWOT strategy, Uber needs to analyze its strengths, weaknesses, opportunities, and threats in the market.
Uber’s Strengths
Strong brand recognition: Since its establishment, Uber has maintained strong brand recognition in the ride-hailing market in more than 50 countries (Umar, 2019). Thus, Uber needs to use this global brand recognition to convince customers that it is still the best company in the industry. To achieve this, the CEO and top management should venture more on brand value framework and incorporate this with new technological features.
Dynamic pricing strategy: Uber remains versatile in its pricing strategy. However, Uber’s strategy “Higher the Demand; Higher the Price” has attracted negative PR from the target market (Bhasin, 2019). Although this policy continues to benefit its drivers, it is unfair to the customers. Therefore, Uber needs to capitalize on its pricing strategy by coming up with a system in which both drivers and customers are happy. This would help retain customers and prevent them from shifting to its competitors like Lyft and Yandex Taxi.
Adaptive nature: Uber’s adaptive nature has contributed significantly to its global growth and expansion. Its expansion globally has exposed it to diverse cultures and nationalities. Uber needs to capitalize on this strength and launch smart marketing through which negative PR can be combated across these countries (Umar, 2019). For example, Uber uses social media platforms such as Twitter, Facebook, and Instagram, Uber needs to let its worldwide customers know of its promos, deals, and any other updates. Also, Uber needs to use these online platforms to respond to customer complaints; this would help end its bad reputation.
Global market leader: Uber remains to be the market leader, extending its transportation services in more than 65 countries and over 785 cities (Bhasin, 2019). In the U.S., Uber enjoys a 69% market share in the industry. Uber should not sleep on this strong brand identity; it should instead address matters that attract negative PR from the target market and embrace a culture that upholds ethical standards and professionalism by its workers.
Uber’s Weaknesses
Multiple scandals: Uber’s brand has endured negative PR over various controversies and scandals. An excellent example of such scandals is sexual harassment to customers by Uber drivers; such attacks have adversely affected its reputation (Faiz, 2019). Another controversial scandal at Uber has been arising when its drivers call for a striker against its low wages and lack of transparency. As a result, Uber’s brand image has continued to create mistrust among drivers and customers. To fix this scandal, Uber needs to improve the pay percentage to drivers, ensure the utmost transparency in its IPO, and deregister drivers who practice sexual harassment over customers.
Public backlash: Uber has been facing a public backlash over its strategic decision to charge high prices during weekends and night hours (Heartofcodes, 2018). For example, during Hurricane Sandy, Uber charged high rates for rides on customers. Uber needs to revise this policy and do the reverse. By giving price-cut offers to customers, Uber will attract positive PR and end this backlash with the public whose impact is adversely felt in the company’s IPO.
Substantial losses: Since 2009, Uber has been experiencing significant losses, especially when it hikes its ride charges. To the executive management, this must be a significant concern, and the best strategies need to be taken to contain this unfortunate trend (Heartofcodes, 2018). The most important strategy to use here is beating the growing competition in the market. Thus, Uber needs to provide bonuses to drivers and give its customers discounts. This would not only help Uber remain competitive but also improve its image to the public.
Uber’s Opportunities
Accountability and performance: Cab customers only want to use organized cab services, which Uber competitors have failed to offer. Only Uber does this. Uber should then exploit this golden opportunity by offering its rider services based on accountability and quality performance (Umar, 2019). To achieve this, Uber needs to let its riders control their data and also to track its drivers’ performance. By using these two strategies, Uber would easily contain the multiple cases of sexual misconduct reported by customers against its drivers while tracking customers’ views on their ride experience.
Market expansion and profitability: Uber’s strengths indicate that it has a perfect opportunity to expand in the market and make more profits (Heartofcodes, 2018). However, with the ongoing negative image in public, this might be impossible. To expand and improve profitability, Uber needs to value drivers as much as riders. Uber has bad employee relations, a key factor behind its huge losses. Poaching drivers from competitors like Lyft is not the solution, and the solution is to value drivers, give them high commissions, and ensure their employee satisfaction (Umar, 2019). This would help Uber grow fast into the world market for negative PR would also end.
Utilize digitalization: The world market is increasingly becoming digital. Although Uber has created the Uber mobile app, it needs to invest more in creating a rating platform through which customer data or reviews are not manipulated (Umar, 2019). Manipulation of customer reviews by Uber has been common, and this attracts negative PR to the company. Through the Uber App, Uber should motivate its users to interact and share their experiences using Uber freely; this positive use of technology would help Uber increase customer base, profitability, and loyalty, where there is no negative attack over its services (Claudia, 2018).
Uber’s Threats
Employee and customer retention: Uber’s key stakeholders are customers and drivers. Surprisingly, the ongoing negative PR against Uber is being led by these two key stakeholders to the company (Faiz, 2019). Uber does not give drivers technical support and has also been reluctant to pay them a better commission for their services. On the other hand, Uber rides have been reporting cases of sexual harassment by Uber drivers. As a result, employee and customer retention is a big headache for Uber (Lazzaro, 2016). Uber needs to improve its driver-company relations by increasing commission margin and helping them secure lower insurance premiums; this alone would ensure employee satisfaction. Also, Uber needs to protect customers’ privacy and charge riders reasonably; this would help in customer retention. As a result, the negative PR would lack power for those who lead it have has their problems been addressed by the management (Lazzaro, 2016).
Lawsuits: At least 300,000 drivers have file cases against Uber of its minimum wage policy. Some drivers have labeled Uber’s wage policy as “unfair” and not considerate of employee welfare (Heartofcodes, 2018). Although these cases have been settled in courts, they have already threatened Uber’s reputation in public. Thus, Uber needs to revise its wage policy, adjust its income claims, and offer a tiered system that spurs drivers to take on more rides per day (Umar, 2019). This will end disappointment among drivers, which would, in turn, correct its public image all over the world.
Stiff competition: Uber’s strongest competitor is Lyft. Uber’s strategic approach to poaching Lyft drivers has sparked heated online discussions by the public, damaging Uber’s reputation severely (Lazzaro, 2016). This strategic approach of trying to undermine Lyft has been unethical and cost Uber its competitive advantage in the market. Uber instead needs to treat its drivers better, and this would be the surest strategy for keeping the best drivers into the company and maintain its strong brand position in the market.
Price Strategy
Uber’s one pricing strategy, which has attracted a lot of controversies, is price discrimination – having the guts to charge different prices to rides that they think are able and willing to pay that price (Agarwal, 2016). However, the outcomes of this strategy have been adverse to Uber’s public image and competitive force in the market. In such events, customers have chosen to turn to Lyft, Juno, or other cab service firms. If Uber continues to use such discriminative policies, its reputation in the market will never improve (Agarwal, 2016). For Uber to eliminate this negative PR, the management needs to set and use the following pricing strategies:
Promotional pricing: Promotional pricing strategy entails providing discounts to customers on a certain product or service (Guido, 2019). Uber needs to adopt this strategy, especially when offering its customers with coupons that entitle them to a certain percentage of the service or the product. For example, under Uber Eats, the company should adopt the pricing strategy of “Buy One Get One Free,” this would attract more customers to purchase the good. Also, Uber needs to consider this pricing strategy during an extended holiday, for example, Memorial Day Weekend, where it lowers Uber ride prices to enable their customers to travel cheaply and explore the world. This would incentivize Uber’s customers to act now and grab the offer; this would help Uber improve its public image too.
Competitive and psychological pricing: Psychological pricing is a strategy used by marketers in encouraging customers to respond to its product or service based on emotional impulses and not on logical impulses (Scott, 2019). For example, in Uber, the company needs to introduce strategies like, for the past five rides whose cost is at least $100, these customers would pay only 80% for their sixth ride. Another psychological pricing strategy for Uber is allowing customers to pay $99 instead of $100; this would attract more consumers and help Uber enlarge its market base. Demand for Uber services will hence increase by creating an illusion of enhanced consumer value.
Value-based pricing: Value-based pricing refers to the approach of setting a price based on how much the customer believes your service is worth (Scott, 2019). For Uber, this strategy is suitable because of the external pressure caused to the company by an increase in competition and economic recessions, which are affecting the customers’ ability to call for Uber ride. Uber would rely on this strategy based on its strong brand awareness in the market, for it is still the best company in the industry. Thus, Uber needs to increase its charges but ensure high-end rider services and experiences are experienced by its customers. Again, Uber should address the issue of sexual harassment by hiring ethical drivers, and this would enable riders’ rate its services high hence attracting more customers who prefer paying high for quality rider experiences.
Price skimming: Price skimming entails setting rates high when a new brand is being rolled out into the market (Claudia, 2018). While Uber continues to face competition from Lyft, price skimming would help the company maintain and retain customers in the market. Through the introduction of new techs or features into its Uber and Uber Eats apps, Uber will be offering the same service in a more cohesive and user-friendly platform compared to its competitors. Through price skimming, Uber needs to gradually drop its prices like, for example, during holidays, by lowering prices for its rides; Uber would attract and retain price-sensitive customers. However, this strategy should be fairly applied to all customers.
Promotion Campaign Strategy
Uber’s promotional campaign strategies are being thwarted by its PR issues in the world market (Bhasin, 2019). In the past, Uber has applied strategic promotion solutions by specific marketing communication activities, targeting diverse publics, and with distinct objectives. To promote positive PR, which would make customers more comfortable using Uber services and products, the management needs to implement the following promotion campaign strategies:
Social media promotion: Uber’s market success is primarily based on technology (Bhasin, 2019). Thus, Uber needs to make use of social media sites like Google+ and Facebook in promoting its services and products in a more relaxed environment. Uber needs to invest more on its current Twitter, Facebook, and Instagram channels in promoting its products. This is the best platform in which Uber will receive both positive and negative feedback from users for response (Claudia, 2018). By this doing, Uber will be in a position to market and promote the only services and products being demanded by customers in the market.
Customer referral incentive program: Uber needs to invest more in creating a referral platform where its customers are rewarded on referring new customers (Bhasin, 2019). In this promotional strategy, Uber needs to enlist cash rewards, big discounts, and free rides and products to those users who refer their friends using a link to install the Uber App and book a ride with the company. This promotion strategy would enable Uber increase the number of customers and also in mitigating the negative public image it currently faces in the market (Scott, 2019). The more Uber enrolls more users, the more Uber improves profitability; this strategy cannot be ignored.
Branded promotional gifts: Uber needs to invest more on branded promotional gifts. Currently, Uber drivers hands out simple business cards to the customers (Scott, 2019). However, business cards are not enough in promoting Uber goods and services. The company needs to expand this strategy by issuing both existing and target customers with t-shirts and caps printed with the Uber logo. This would make people want to be associated with Uber, attracting them to install Uber apps and start enjoying Uber services; this would improve Uber’s brand reputation, profitability, and competitiveness into the market (Bhasin, 2019).
Use of after-service customer surveys: Uber needs to design a system that automatically pops up in a customer’s smartphone screen immediately he/she alights at the destination they ordered to be dropped by the cab drivers, for example (Heartofcodes, 2018). In this platform, customers would be required to rate the experience being droved by Uber and the driver in charge from one to five stars. Also, this promotional campaign needs to leave a room whereby customers can write any other information they want the company to address (Guido, 2019). By thus doing, Uber will promote its services while at the same time working on the concerns raised by customers to prevent its reputation in the market.
Conclusion
Uber has proved capable of reacting well under challenging situations. In the case of negative PR, Uber needs to focus on goodwill marketing, value drivers as much as riders, and let riders control their data. Based on the analysis, Uber needs to rebuild work ethics and values, change the performance review system by integrating internal driver review systems with those of users, create new formal promotion strategies, clearly address customer concerns, rebuild its organizational culture, and ensure transparency in all its operations. By this doing, Uber will surely gain an edge in terms of competition, customer loyalty, attraction and retention, and profitability. As a result, bad PR will become an issue of the past; and the company will continue enjoying success, sustainability, growth consistency, and profitability in the industry where it operates.
References
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