Uber should focus its new found millions on the emerging markets


If Uber hasn’t launched in your city yet then you are missing something, because in the last few months the mobile based private car service has been aggressively expanding. The company just got an insane amount of investment from Google Ventures and a few other funders. Think about it this way: if you have US$361.2-million injected into your company, what would you do? Expand expand expand.

Things are changing at Uber: the company has revamped its site with a slicker more luxury look indicative of the brand, it has launched a BlackBerry app and it now operates in 40 cities across the world but its emerging market footprint is still only quite small. The big news in the last few months has been the company’s entry into Africa, Asia and the Middle East with South Africa, India, China and the United Arab Emirates among the countries heralding those expansions.

Uber, with a US$3.76-billion valuation, is a company that is disrupting the private driver space. Based in San Francisco, Uber makes a mobile application that connects passengers with drivers of luxury vehicles for hire. At its core, the company is an on-demand private driver. Users of the service can request a ride at any time using its iPhone, BlackBerry and Android apps or from its mobi site. With your credit card registered on the service, the car picks you up and the trip is tracked from the moment you get in ’til you get off.

Surely emerging economies should be a key player for a tech company that deals in luxury travel? Most businesses are looking at expanding into these regions and then there is that growing middle class with disposable income to burn.

According to Uber, the reason for this is because it’s still growing and attempting to move rapidly across the globe. “We’re growing fast in just about every corner of the world,” says Uber Cape Town’s management, in charge of one of the first of the emerging market regions that the company has begun operating in. “Since our launch in San Francisco three years ago, we’ve been focused on growing within the U.S. first and now internationally to meet consumer demand.”

Emerging markets are tired of waiting

An argument could be made that Uber as a luxury service could not survive in emerging economies because users cannot afford to pay such amounts of money for a glorified taxi ride. Uber may even make this argument itself. Although the company has introduced options that counter those with a mix of price points including UberX (low cost Ubers), UberTaxi (same principle as a cab without having to hail it), UberBlack (black sedans), UberSUV (roomier cars) and UberLux (luxury cars).

For its Africa, Asia and Middle East play Uber has only introduced the UberBlack option (interestingly Uber is not yet available in South America). According to the company Africa is an exciting space right now (a general consensus these days) and more cities are going to get the Uber treatment in the near future.

“We are Uber-excited about Africa,” says Uber. “Looking at the phenomenal growth African countries and their cities are showing we wanted to get onto the continent as quickly as possible. The goal is to be everywhere consumers want us to be… and we have heard you Africa.”

If imitation truly is the best form flattery then Uber should be very flattered. There are many Uber clones in the emerging market regions. Some are championed by cookie cutter company Rocket Internet with its Latin America-based Easy taxi that has just launched in Nigeria as its entry into Africa.

South Africa’s Zapacab, which uses the same principles as Uber, launched publicly just a few weeks before Uber made its Africa presence public knowledge. Interestingly, Zapacab uses local taxi companies to provide a similar service.

Perhaps Uber is being cautious in the emerging markets because of local competition? Apparently not.

“Competition is at the heart of innovation and it forces us to continuously improve our product and adapt to local needs. This is why we hire local teams in every city we operate in,” says Uber.

Currently the Ubers operating in South Africa, Bangalore and Dubai are still in stealth mode while the company looks for staff to run operation in the those regions.



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