Why Uber Remains Disruptive and Dangerous

Uber is the Kanye West of Silicon Valley: bold and brilliant. Toxic and troubled. Disruptive and dangerous.

Uber’s willingness to play dirty and its dysfunctional culture are well documented, most recently in a New York Times piece, “Uber’s CEO Plays with Fire” that laid bare the controversial management style of CEO Travis Kalanick, including his “pattern of risk-taking that has at times put his ride-hailing company on the brink of implosion.” The company’s many scandals have given rise to the #DeleteUber movement, which has been an economic boon to rival Lyft.

And yet Uber remains as bold and disruptive as ever, as two recent news developments show.

On April 25, Uber announced that it will launch a network of flying taxis in Dallas and Dubai by 2020. The news places Uber front and center among the companies trying to define a market for electric vertical takeoff and landing aircraft (VTOLs), also known as flying cars (to the chagrin of purists). So-called flying cars could change the way people travel and the way transportation companies, delivery services, and even urgent care/on-demand health services operate, especially in urban markets hampered by congestion. Other prominent players trying to launch VTOLs include Airbus and  Kitty Hawk, a company backed by Google cofounder Larry Page, which released a demonstration video of a prototype on April 24.

The development and rollout of VTOLs faces some major hurdles ranging from regulatory barriers to constraints in battery life for the craft themselves. But if Uber has taught us anything, its the company’s ability to disrupt. This is the company that ushered in the era of the on-demand economy and disrupted the transportation and delivery industries. It’s also a business that knows how to scale an idea. As Alex Davies of WIRED reported, the company has formed partnerships with companies that are developing VTOLs as well as relationships with the businesses necessary to build out a flying car infrastructure. As he wrote:

And here’s the crazy part: Uber could make it happen. “I think 2020 is realistic for a vehicle that is not replacing an airplane but replacing a car,” says Richard Pat Anderson, director of the Flight Research Center at Embry-Riddle Aeronautical University. A purely electric aircraft might remain elusive, but a serial hybrid setup—where the aircraft carries a fuel-burning turbine to keep the juice flowing, much like the Chevrolet Volt—could work.

Meanwhile, as flying driving cars and Uber’s scandals were making headlines, McDonald’s announced that the fast-food giant has teamed with Uber to deliver McDonald’s to your door. As McDonald’s pointed out, nearly 75 percent of the population in its five largest markets live within three miles of a McDonald’s, and McDonald’s has been testing the Uber delivery service since December (through UberEATS, Uber’s food delivery unit).

As Peter Frost of Crain’s Chicago Business reported, “Delivery is a natural sales channel for McDonald’s to pursue since much of its food already is consumed outside its restaurants. Some 70 percent of McDonald’s U.S. business goes through the drive-thru, and in urban areas, far more consumers take its food to-go versus eating inside.”

The McDonald’s relationship is an example of how Uber can partner with brands that have the muscle and reach to help Uber deliver on its vision, in this case, services that cater to the on-demand consumer. Uber does the same with hospitals to deliver on-demand healthcare as well.

Uber doesn’t need to play nice to be disruptive and dangerous. Uber does not even have to be a long-term success. Ideas are the fuel of disruption, and Uber knows how to scale an idea even as the company’s brand implodes.

Note: check out Uber’s 2016 white paper on VTOLs here.

Amazon and Walmart Fight for the On-Demand Grocery Shopper

On March 28, Amazon fired a shot in its war with Walmart to define the future of the $600 billion grocery industry. The world’s biggest online retailer announced the beta launch of AmazonFresh Pickup, an on-demand grocery service. With AmazonFresh Pickup, customers can order groceries online and have their orders ready for pick-up at designated AmazonFresh Pickup physical locations — in as little as 15 minutes.

The service is a clear response to Walmart’s limited rollout of Pickup and Fuel concept stores, where customers order online and then drive to Walmart to have their groceries loaded into their cars by employees.

Both businesses are racing to win loyalty from the on-demand consumer.

The rise of the on-demand consumer is one of the compelling trends defining the 21st Century economy. As Google has reported, we’re living in the era of the micro-moment, when consumers, armed with mobile devices and apps, can research and purchase goods and services on their own time and terms. On-demand businesses such as Uber have acted as important catalysts. Uber, for all its flaws, demonstrated the power of responding to mobile consumers with an easy-to-use app that provides a service on demand, and the company has had a profound impact across many industries. Businesses ranging from Panera Bread to 7-Eleven have responded to the on-demand consumer with services such as online ordering and drone delivery.

The grocery industry is well suited to an on-demand model. People need to restock groceries often, and obviously perishable goods have a limited shelf life. But as writer Mark Rogowksy notes in Forbes, the on-demand grocery model has been fraught with its share of failure, one of the reasons being that grocery delivery is not as “on-demand” as it sounds. In fact, it’s a lot easier for mobile consumers to order and pick up groceries on the go rather than wait around in their homes for delivery. Hence, Walmart has been experimenting with the Pickup and Fuel stores. Walmart launched the stores in late 2016 amid speculation that the giant retailer had found a way to battle the ongoing Amazon threat.

At about the same time Walmart began experimenting with Pickup and Fuel, Amazon made headlines with the beta launch of Amazon Go, which consists of physical self-service grocery stores where anyone with an Amazon account, a supported smartphone, and the Amazon Go app can simply take what they want from the store and leave with no check-out required. The flagship Amazon Go store is open exclusively to Amazon employees, and so far the frictionless shopping model has encountered glitches as the in-store technology struggles to keep pace with consumer foot traffic when the Amazon Go store gets busy. Amazon has delayed the launch of a public-ready Amazon Go. But as Amazon has demonstrated with its latest announcement, Amazon has many more cards to play.

Both Amazon and Walmart are in a strong position to lead the on-demand grocery business. They both have brand muscle and deep pockets. Amazon is crushing Walmart (and everyone else) in online retailing, and Amazon is successfully moving into our homes and cars with on-demand devices and technologies such as the Dash button and Alexa voice assistant, which make Amazon a more ubiquitous and convenient presence in our lives, as Google strives to be. Walmart, though, possesses many advantages, including scale and a powerful physical ecosystem that includes not only its stores but network of partners, over whom Walmart wields considerable power.

Walmart also has an uncanny knack to experiment and learn. For example, in 2015 the company launched Walmart Pay to make it possible for shoppers to use their mobile devices to check out and purchase goods, and in 2016, Walmart expanded Walmart Pay across 4,600 stores. Walmart has quickly added services to Walmart Pay that cater to the needs of on-demand consumers, such as the ability for shoppers to refill prescriptions and skip pharmacy lines. Here is a company that understands the intersection of the mobile and physical worlds.

In coming months, Amazon and Walmart will continue to claw their way for leadership. And who will win? The on-demand consumer. With each innovation, Amazon and Walmart are reshaping the grocery industry around the needs of mobile consumers — which is good news for shoppers and the businesses that possess the means to service them on shoppers’ own terms.

Image source: Matthew Kane (https://unsplash.com/@matthewkane)

The Four Elements of the On-Demand Economy

Big brands continue to transition to the $57.6 billion on-demand economy, which is characterized by the complete removal of friction from consumer purchases:

  • Jaguar and Shell recently rolled out a partnership to make it possible for people to prepay for gas from their in-car infotainment touchscreens. By using Apple Pay or Paypal configured in a Shell app, Jaguar drivers in the United Kingdom can select how much gas they want and prepay without needing to take out their wallets. The service will expand globally.
  • Walmart now allows customers to bypass lines at its in-store pharmacies. Pharmacy customers use their Walmart app on their mobile devices to order prescription refills and then use an express lane to move ahead of the customer service line and retrieve their orders. Customers can also track order status and view pricing details.

Product preordering is hardly new. As I have discussed on my blog, brands such as Starbucks and Panera Bread have been offering preorder services for a few years. But businesses such as Jaguar and Walmart help legitimize preordering, which is one of the elements of the on-demand economy. Meanwhile, many brands continue to develop services that deliver products to consumers on demand. Amazon removes friction from online (and offline) buying with Dash buttons and Amazon Go stores. Retailers such as (Walmart among them) have launched services that make it easier to either pick up products or have them delivered to your home. Uber deserves credit for being the on-demand catalyst. Now the legacy brands are learning and adapting.

The Four Elements of the On-Demand Economy

The “on-demand brands” typically adopt one or more of the following four elements of the on-demand economy:

  • Making it possible for consumers to prepay and avoid needing to reach for their debit cards or for cash, a model that fueled Uber’s rise. Prepay works especially well with high-volume products that rely on repeat purchases and low consideration, as is the case with Panera, Starbucks, and Walmart’s pharmacy. Typically customers know what they want before arriving at the store and don’t want to spend a lot of time choosing among products.
  • Delivering products to consumers on their own terms, often at their own homes, faster than ever before. For instance, Amazon has launched drone delivery in the United Kingdom to speed up product delivery and is preparing to do the same in the United States. UberRUSH partners with brands such as Nordstrom to offer product delivery, and business such as Heal in Los Angeles bring doctors to your doorstep. These types of services appeal to a variety of demographic segments, ranging from busy parents to urbanites who don’t own cars and lack time to pick up their products. But fulfilling product orders in an on-demand fashion does not need to require the brand to deliver products to the home. Walmart is experimenting with Pickup and Fuel concept stores, where customers order online and then drive to Walmart to have their groceries loaded into their cars by employees.
  • Relying on mobile devices such as phones and wearables. One cannot overstate why mobile has been integral to the rise of the on-demand economy. Mobile searches overtook desktop searches two years ago. There are almost as many mobile phone subscriptions as there are people on earth (which took only 20 years to happen). As Google noted, mobile phone users typically want things done in the moment — what Google calls micro-moments of demand. During micro-moments, people make instant decisions about where to go, what to do, and what to buy: about 76 percent of people who search on their smartphones for something nearby visit a business within a day, and there was a 2.1x increase in mobile searches for stores open now and food open now from 2015 to 2016. Those findings make intuitive sense: when you’re on the go, you don’t have a lot of time to do complex research for things to buy.
  • Using on-demand marketplaces in which people tap into a pool of available inventory to get what they want. Examples of on-demand marketplaces include Uber, Lyft, and Zipcar for either getting a ride (Uber and Lyft) or renting a car quickly. A number of on-demand marketplaces have popped up in local markets to service different industries. For instance, in Chicago, ParqEx connects people who want to rent their parking spaces with people looking for parking in the moment. Many pundits associate Airbnb with the on-demand economy. But I think Airbnb’s success has more to do with opening up a broader inventory of lodging options as opposed to making them available on-demand. Browsing Airbnb is more of an “I am traveling and want an interesting alternative to a hotel” than “I need a place to stay now.”

Voice and Self-Service

The on-demand economy is evolving rapidly in a number of ways, mostly notably through the rise of voice search. Voice search ads a layer of complexity to on-demand transactions: with our voices, we can request more complex services and products. We can ask Alexa, “Tell me where I can watch the movie Get Out this afternoon and use my Stubs discount card” or “Where can I get barbeque ribs in the west Chicago suburbs?” Businesses that want to be found during those open-ended searches need to optimize their online content and data so that they are visible for voice search. Businesses that understand how to make themselves visible for voice will capture more on-demand queries, thus being part of the on-demand journey, from awareness to consideration to purchase and service.

Another major development is the use of buy buttons such as Amazon Dash to enable self-service on-demand. The Amazon Dash button turns any object into a smart device for replenishing items such as laundry detergent. Amazon reports that the Dash buttons, available to Amazon Prime members, have taken off. According to Amazon, Dash button orders occur over twice a minute, and for many popular items, more than half of orders are done via Dash buttons. The list of brands signing up for the program include Campbell’s Soup, Cascade, Clif Bar, Mentos, and Quilted Northern, to name but a few. All told, more than 200 Dash buttons exist.

It’s easy to foresee a time when Amazon will turn the Dash button into an auto-order device that uses sensors to replenish certain products without the consumer even needing to click a button. Auto on-demand may take hold in other industries and forms for products that are ordered often. For now, brands are responding when consumers call — and faster than ever.

Image source: nextjuggernaut.com

Amazon Dashes to the On-Demand Economy

Sometimes change wears an awkward smile. When Amazon launched Dash buttons for instant re-ordering of products in 2015, the idea seemed so goofy that some considered the announcement to be an April Fool’s Day joke. Amazon actually expected people to affix WiFi-enabled hardware devices to any object in our homes so that we could restock on diapers and detergent with the simple touch of a button?

But Amazon was deadly serious. The Dash buttons, available to Amazon Prime members, have taken off. According to Amazon, Dash button orders occur over twice a minute, and for many popular items, more than half of orders are done via Dash buttons. The list of brands signing up for the program include Campbell’s Soup, Cascade, Clif Bar, Mentos, and Quilted Northern, to name but a few. All told, more than 200 Dash buttons exist. They give consumers convenience; and for brands, revenue and access to consumer purchase data.

As it turns out, people find it useful to turn their appliances into smart objects. For instance, if you place a Tide Dash button on your laundry machine, you make it easier to restock on detergent at the precise moment when you realize you are running low, presumably when you are doing laundry with the machine nearby. All you need to do is click on the Dash button, which triggers the instant order. No muss, no fuss, no online shopping cart.

On January 20, Amazon officially expanded the use of Dash buttons on the Amazon home page. (Note the irony here: a business that started as an online retailer launched a physical product and brings it to the online world). You can create your virtual Dash button by choosing an “Add to Your Dash buttons” option on a product’s detail page — but Amazon is also creating them automatically for products you order often or have ordered recently. The buttons are available for both desktop and (more importantly) mobile use — thus turning your mobile phone into an all-purpose dash button.

The Dash buttons are succeeding because Amazon has tapped into a broader trend toward on-demand shopping and living. Uber famously triggered the advent of the on-demand economy with its convenient app that made traditional taxi services look antiquated. Now businesses ranging from Nordstrom to Walmart have been incorporating apps, drones, ride-sharing services, and other forms of on-demand ordering and delivering. According to the Harvard Business Review, the on-demand economy generates $57.6 billion and attracts 22 million consumers annually.

And mobile is crucial to the uptake of on-demand living.  Since 2013, consumers have preferred using their mobile devices over laptops and desktops to interact with retailers online. As Google has reported, we are increasingly using our mobile devices to decide what to do, where to go, and what to buy — and in on-demand fashion. For instance, half of consumers who conduct a local search on their smartphones visit a store within 24 hours.

Google calls these moments of instant decision making “micro-moments.” Amazon intends to capture its share of those micro-moments by making it easier to order products with our phones, which is where Dash buttons on our mobile phones come into play.

Apps such as Instagram and Pinterest have incorporated their own equivalent of Dash buttons, but none of succeeded like Amazon has. Why? Because Amazon had already established itself first as a strong product discovery shopping platform long before incorporating the Dash buttons. And it took years for Amazon to ingratiate itself into our buying habits. The Dash buttons would come later.

Amazon patiently embedded itself into our everyday routines by becoming a user-friendly platform for finding and buying things on our own terms. Dash buttons are just part of its strategy for making shopping an even more natural part of our lives:

  • Dash buttons on our laptops and home appliances for ordering via touch.
  • Alexa in Amazon Echo, automobiles, and phones for ordering via voice.

With Dash — and the much bigger Alexa — Amazon is leading the uptake of the on-demand economy everywhere through natural actions such as clicking and talking. No longer is Amazon a retail engine. It’s a lifestyle brand for the on-demand economy.

Related:

Why Voice Search Is the Future of the On-Demand Economy,” June 14, 2016.

This Is the World Uber Has Made,” June 7, 2016.

Welcome to a New Era of Convenience Shopping,” June 29, 2015.

 

Uber’s Future: Snapchat on Wheels

I recently received an invitation to check out some behind-the-scenes Rogue One: A Star Wars Story videos and watch cartoon images of Star Wars X-Wings fly through the streets of Chicago. There was only one catch: the experience was available exclusively on my Uber app and viewable only after I had requested an Uber ride. I believe the Rogue One content points to a new future for Uber: one in which the app serves as a content-sharing platform for brands, like a Snapchat on wheels. Soon, musicians will launch new song videos on Uber before anyone else can see them. When Wes Anderson creates another slick short-form holiday film, Uber riders will see it first. Get ready for Uber to become a hot media brand.

Uber has been blurring the lines between ride sharing and entertainment for some time. In July, Uber hosted a secret concert with musician Wale, and the only way to attend was to unlock the location through Uber. In September, Uber introduced Rider Music, through which riders can tap into their own Pandora and Spotify playlists through Uber — in essence, taking their favorite curated music with them while they’re getting an Uber ride. Rogue One marks a first: branded entertainment content embedded in the app.

And there’s no reason why Uber needs to limit itself with entertainment experiences. In fact, Uber already offers branded content through relationships with other businesses, just not in the slick, in-app way that Disney does with Rogue One. In January, Uber launched “Trip Experiences,” which relies on integrations with third-party apps to make it possible for brands to serve up content ranging from restaurant reviews to news. It’s taken some time, but businesses are figuring out how to take advantage of the functionality. The Washington Post recently launched an integrated viewing experience through which readers can browse content on The Washington Post app while checking the status of their Uber ride. Moreover, Uber recently announced that users could order Uber rides off the websites of nearby businesses and receive branded content from those businesses en route. Cole Haan and Guitar Center have already beta tested the functionality.

Becoming a more full-blown media app for content sharing makes perfect sense for these reasons:

  • Uber is sitting on a treasure trove of data about the 50 million people who have taken 2 billion Uber rides, including who they are, where they are going, and what they’re doing. (Uber has received criticism over its use of customer data, too.) The company can offer advertisers very targeted opportunities to reach segments such as millennials. And Uber regularly puts its customer insight data to use, forming partnerships with brands such as Starwood that want access to Uber’s customers to provide offers such loyalty program points for customers that use Uber.
  • Uber could use from the revenue the app could gain by forming relationships with brands. The company lost a reported $1.2 billion in the first half of 2016, with a failed expansion into China proving to be especially costly. The company is eager to show that it can monetize effectively in advance of an expected IPO.
  • By its nature, Uber is a utility that people have to open in order to use. The downtime that users experience during Uber rides is a natural moment for brands to share content to keep users engaged with Uber so long as the content is engaging. Picture those annoying screens that play in the back of taxicabs (if you still take taxicabs anymore) only with content that is more interesting and useful — because Uber is consistently an interesting and useful brand. Rogue One, for instance, is not a randomly curated piece of content. Uber has timed the sharing of the behind-the-scenes video plus the playful in-app Star Wars space craft experience during the run-up to the official opening of Rogue One to capitalize on a time when users are going to be more naturally interested in viewing the content. The Rogue One/Uber experience is all about relevance.

Uber also consistently demonstrates a willingness to adapt its business. As I’ve contended on my blog, Uber’s core business is disruption, not ride sharing. Uber has entered markets ranging from food delivery to healthcare by wedding technology with a keen understanding of consumer behavior, by the creation of partnerships with other brands, and by consistently trying new models. Uber tests, learns, and corrects its model quickly. Right now making a content push is Uber’s latest test-and-learn initiative.

Businesses can play in a number of fascinating ways. In addition to serving up exclusive content, brands could provide broader experiences that span the online and offline worlds. The next musician who offers a secret concert via an Uber relationship could also provide exclusive music through Uber while fans ride to the concert. Imagine a hotel offering rides to its guests via Uber and providing exclusive in-app games for riders en route to their destination.

Uber is a palette for content. Businesses just need to figure out the right kind of branded content that engages riders. Rogue One offers a glimpse of how that content will look.

SIM Partners Makes It Easier to “Ride There with Uber”

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Location is a catalyst for the $57.6 billion on-demand economy.

Case in point: today SIM Partners, a location marketing technology platform provider (and one of my clients) announced that the company has made it possible for brick-and-mortar businesses ranging from restaurants to retailers to add a “Ride There with Uber” button to their location pages.

SIM Partners clients that use the company’s Velocity platform to add the Uber button to their pages will provide an easy way for anyone to order an Uber to their location. The button will appear along with the usual content, such as store hours and addresses, which you find on a brand’s location page when you use your smart phone to conduct a search for things to do and places to go nearby. So, for example, a shopper interested in checking out a sale at a shoe store can order an Uber right off the store’s location page, as shown in this image:

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Velocity manages location pages for businesses with multiple brick-and-mortar locations. So for a brand with thousands of location pages, the addition of a “Ride There with Uber” button can convert searches to in-store business at scale. As SIM Partners noted in a press release, 76 percent of people who conduct a local search on their smartphone visit a business within 24 hours, and 28 percent of those searches result in a purchase. SIM Partners aims to help its clients capture their share of those searches by nudging searchers one step closer to the store.

The announcement comes at a time when the addition of buy buttons on sites such as Pinterest has amplified the role that digital plays in the growth of an on-demand economy in which consumers can get what they want faster than ever before. Indeed, according to an August 2016 Harvard Business Review article, online businesses account for the largest category of on-demand spending. Brick-and-mortar businesses are responding by developing on-demand services that rely on a mix of digital and offline delivery tools. Brands such as Domino’s Pizza, Nordstrom, and Walmart are creating partnerships with business such as Uber, and developing integrations with technologies such as Amazon Echo, which promise shoppers faster delivery of goods and services from brick-and-mortar stores. Others, such as Shoe Carnival have succeeded by providing mobile wallet offers that lure shoppers to stores in order to enjoy time- and place-sensitive deals.

Uber is the engine of the on-demand economy, both online and offline. According to Business Insider (and reported by SIM Partners in its press release), Uber completed 62 million in July, a 15 percent increase over the previous month. As I have noted previously, Uber ushered in the on-demand economy by tapping into unmet consumer needs and offering services that have disrupted industries ranging from retail to healthcare. SIM Partners clients span multiple industries in which brick-and-mortar locations are at the center of the customer experience. It makes perfect sense for SIM Partners to add Uber functionality for its clients’ customers.

Technology becomes pervasive when it permeates multiple industries and when everyday people use it, which is the key to the success of brands such as Apple. Uber enjoys that kind of success. Anyone with a smartphone can order an Uber. Integrations with companies such as Foursquare and SIM Partners make Uber more pervasive for businesses, too — and make it even easier for people to use Uber to get what they want on their own terms. It helps that Uber makes its API available to businesses. Uber simplifies life for both consumers and businesses. Simplicity is the key to the on-demand economy, which is attracting 22 million consumers annually — and investments from some of the world’s most valuable brands. As the services being developed by the bellwether companies such as Walmart take hold, look for brick-and-mortar businesses to grab an even bigger share of the on-demand economy, with location being the battleground.

 

 

How Uber Feeds an Appetite for Disruption

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The news about Uber rolling out self-driving cars later in August underscores the reason why Uber has become a multi-billion dollar brand within seven years: Uber’s core competence is not ride-sharing — it’s disruption.

Uber has consistently developed and modified its business model to either drive or participate in disruption. Consider these examples:

  • In 2009, Uber initially upended the auto transportation industry by launching a ride-sharing service that liberated consumers from the tyranny of taxicabs that dictated terms and pick-up schedules to passengers. The launch of Uber was the big bang, which ushered in an era of on-demand, peer-to-peer services in multiple industries.
  • Uber set its sights on home delivery with the launch of UberRUSH in 2015 and UberEATS in 2016. UberRUSH delivers goods for retailers ranging from Nordstrom to boutique florists. UberEATS focuses on food delivery for restaurants. The service is moving its way across the United States by forming relationships with dining establishments in major cities such as Philadelphia, where more than 100 restaurants partnered with UberEATS on the first day of its launch.
  • The deployment of self-driving automobiles is part of a broader disruption of the automotive industry, which has involved an interesting partnership between automakers such as Ford and Silicon Valley titans such as Google, as car manufacturers seek to change their own industry with autonomous vehicles before someone else does. Self-driving vehicles, following their initial use in Pittsburgh, will permeate both transportation and delivery, potentially outmuscling the use of drones that other businesses are adopting.

How does the company continue to ride waves of disruption, even challenging the very service it launched in 2009? Three factors play a role:

  • A knack for wedding technology with an understanding of human behavior. Uber initially succeeded not because it provided a cool app but because the company understood that people ordering taxicabs require responsiveness, ease of use, and transparency in pricing — needs that were unmet by the status quo. The Uber app filled the void by making it ridiculously easy to order a ride when you want it and where you want it. No longer was it necessary to navigate clunky phone trees to request a cab and then wait around wondering when your ride was going to show up.
  • Creation of partnerships with like-minded brands. Uber doesn’t go it alone. For ride-sharing services, Uber has created relationships with businesses such as Foursquare to make it even easier to order an Uber. The success of UberRUSH and UberEATS relies on Uber’s ability to partner with retailers and restaurants. It’s no accident that one of UberRUSH’s delivery partners is Nordstrom — a company known for its innovations in customer service. (I expect Uber will expand its relationship to go beyond delivery and offer customer service options akin to a Nordstrom town car, shuttling loyal customers around for a day of shopping and in-car entertainment as an exclusive service.) Similarly, Uber is partnering with Volvo with self-driving cars.Uber finds not just any partner, but the right fit for Uber.
  • A willingness to adapt. UberEATS initially rolled out in 2014 as a feature on the Uber ride-sharing app. But the experience was wonky. Uber realized that people are in two different frames of mind when we order rides and food: when we want a ride, we want to get from point A to point B. We don’t want to bother with ordering food delivery. So Uber decoupled the feature as a standalone app. Uber has also constantly changed its ride-sharing app, introducing greater levels of information transparency. Now Uber is revised its business model with a driverless service. Uber also recently introduced UberPOOL, which encourages passengers to share rides and split their transportation costs. UberPOOL could cut down on congestion and pollution by combining multiple rides in one car. UberPOOL has reportedly taken 7.9 million miles off the roads and 1,400 metric tons of carbon dioxide out of the air in Los Angeles within its first eight months of use.

What’s next for Uber? What industries might the company upend? Here are some candidates:

  • Entertainment. Uber can become an entertainment brand in a number of ways. Live Nation and Uber already have a basic ride service partnership for people to order rides to events, but I think Uber is capable of much more, especially by bundling entertainment with ticketing and transportation. Uber is big enough to offer the entertainment itself through partnerships with artists. Uber already hosts private concerts for customers. Uber may also capitalize on the car itself as a source of entertainment. The company already offers ad-free streaming via apps such as Pandora, which just hints at the kind of in-car entertainment options Uber could provide, ranging from music to streaming movies for longer rides. Cars provide much more than transportation. They’re already mobile content machines.
  • Healthcare, by bringing medical providers to patients (and vice versa) and by managing the delivery of pharmaceutical products. Companies such as Pager exist already to bring physicians to patients’ locations on demand. But Uber has the scale to pull off on-demand medical care nationwide. Already Uber has a relationship with Relatient to offer transportation services to patients. More to come here.

Uber could also expand payment, customer loyalty, and advertising services through partnerships with other companies, becoming an all-purpose customer acquisition and service platform based on the data the company collects on its customers.

Uber will also go beyond the app interface if it needs to do so. If the economics make sense, Uber could penetrate wearables to provide even more frictionless, on-demand services.

What do you think Uber will do next?

Why Voice Search Is the Future of the On-Demand Economy

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Mobile gave rise to the on-demand economy. But voice search will fuel its future.

Google demonstrated how voice will form the foundation of an on-demand search ecosystem when Google announced the Google Assistant intelligent search tool at the company’s I/O event in May. Then Apple, at its Worldwide Developers Conference June 13, showcased a smarter and more ubiquitous Siri voice-activated intelligent agent for using our voices to do everything from order an Uber ride to make restaurant reservations. Both developments underscore how voice is rapidly shaping the way we research and buy in the moment.

On-Demand Everywhere

In a June 7 blog post, I discussed how mobile triggered an uptake in on-demand living by making it easier for consumers to use their phones to quickly find things to buy and places to visit. Google calls these moments of rapid decision making “micro-moments.” Uber sensed the popularity of micro-moments by launching its now wildly popular service through which we use mobile devices to get rides when we want them. Amid Uber’s ascendance, businesses ranging from Amazon to Walmart have embraced various models of on-demand commerce.

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This Is the World Uber Has Made

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Uber has become so pervasive that the company is changing our vocabulary.

In everyday settings, we use Uber as a verb (as in “I’ll Uber to the ball game tonight”). In business settings, we use the term “uberization” or “uberfication” to refer to companies creating on-demand services such as home delivery of groceries or healthcare on demand. The Uberization of our vocabulary is a perfect example of how technology enables a change in consumer behavior. Thanks especially to the uptake of smartphones and apps, consumers are making purchasing decisions faster, and we’re expecting businesses to respond on our terms. The Uberization of our own consumer behaviors explains why Amazon has been embracing the use of automated drones to deliver goods faster and why brick-and-mortar businesses ranging from Nordstrom to Walmart are partnering with ride-sharing services to offer home delivery as well.

But is an on-demand world a happier one?

Walmart on Demand

On June 2, Walmart’s Chief Operating Officer Michael Bender announced that the $482 billion brand is piloting a grocery delivery program in select markets. Customers using the service will place grocery orders online and designate a delivery window. Walmart personnel will prepare their orders and may have a ride service such as Deliv, Lyft, or Uber deliver the items to the customer’s door. Customers will pay a delivery fee directly to Walmart as part of their online order rather than fuss with paying a driver along with the grocery order. If the process works as Walmart intends, customers will be able to order what they want online once, and all the prep and delivery will occur behind the scenes. As noted on Walmart’s blog, Sam’s Club has been piloting a similar program in Miami since March.

On-Demand Businesses Continue reading

Why Winning with Digital Is Like Making a Movie

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Mastering digital business is a lot like making a movie: you need to assemble a network of experts instead of trying to do it all yourself. Embracing an ecosystem to create customer value was the main take-away of Level Up: The Next Challenge in Digital Mastery, a presentation by Bill Doyle, vice president, principal analyst, Forrester Research. Doyle delivered his remarks October 28, 2014, at the Forrester Forum for eBusiness & Channel Strategy Professionals.

The theme of the 2014 eBusiness Forum, attended by Fortune 1000 organizations, is “Map Your Path to Digital Mastery.” The purpose of the 2014 Forum is to help business leaders understand how to embrace digital as a way of doing business.

“Digital mastery is a lot bigger than buffing up your website,” Doyle said. “Your competitors are creating new ecosystems to create better products at a lower cost than you can.”

The alternative to mastering digital is to allow digital to disrupt your business. According to Doyle, 93 percent of business executives say digital technology will disrupt their business within the next 12 months, but only 34 percent say they are ready. “A lot of industries are vulnerable right now, ranging from telecom to media,” he said. “It’s not just a matter of if you will be disrupted, but when.”

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He compared the evolution of digital to the transformation of the motion picture industry. Decades ago, Hollywood studios used to own the entire process of creating and distributing movies via a vertically oriented system. But anti-trust legislation and, more importantly, the rise of TV, disrupted Hollywood, creating a massive decline in movie attendance.

“The power in Hollywood shifted to agile, independent producers,” he said. “The result was better products: fewer, better movies. Movies today are made via an ecosystem of specialists who come together for the purpose of creating a movie: they disband when done.”

He indicated that thanks to digital, the modern way of making movies is being adopted by many industries across the customer lifecycle. Disruptors such as Uber to Wealthfront are “relying on networks of partners to come together to create better products than vertically oriented firms can.”

For instance, Wealthfront is a “robo-advisor” that provides automated wealth management services. Founded in 2011, Wealthfront relies on a network of partners to provide wealth management, ranging from Xignite for market data to Apex Clearing for accounting opening, funding, and trading. Wealthfront hit $1 billion in asset value twice as fast as it took Charles Schwab to do so. And Wealthfront employs only 50 people, most of whom are developers.

“Wealthfront can offer services at much less cost than traditional assets managers,” he said.

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Meantime, Uber famously relies on an ecosystem of drivers, technology affiliates, technology providers, and other partners to upend the transportation industry with surge pricing. Moreover, Uber shares its software with any firm that wants to embed agile, Uber-like capabilities in their own apps.

“When you mess with pricing as Uber is doing, all hell breaks loose,” Doyle added.

According to Doyle, mastering digital is not the province of the smaller start-ups, however. Any business that continuously uses technology to create new sources of value for customers and to increase operational agility in service of customers can succeed as Uber and Wealthfront are doing. In fact, Bank of America, 3M, and Walgreens (all appearing at the 2014 Forum) have done so.

“Established businesses need to accelerate their transition as Bank of America, 3M, and Walgreens are doing,” he added. “Walgreens is undergoing a cultural transformation. Bank of America is riding a storm surge of empowered customers. 3M has a long tradition of customer-centric innovation, which is driving the company’s embrace of digital.”

And the key to winning with digital is the same for big companies as it is for smaller start-ups: move quickly and open up your business to an ecosystem. Act like a modern-day filmmaker and look outside the four walls of your business to find the right talent for the time.