The Wheels of Change

Posted on Posted in Advertising, Brand Strategy, Consumer Trends, retail strategy, Shopper Marketing

One evening last week, a possible vision of the future of urban transportation pulled up outside a bar in the Mission District of San Francisco. I summoned it in less than a minute, using an app on my smartphone. By the time I had got up from my stool and walked outside, my ride was there.

The vehicle in question was an UberX, Uber’s lowest cost option, which controversially makes use of private drivers for public transportation. This particular car was a Toyota Prius, and it whisked me across town for $6.78, the fare debited invisibly and painlessly from my card via the app. The experience was cheap, convenient, clean, comfortable, and contemporary.

In select cities across the U.S. this Summer, UberX is being offered at 20-25 percent off, making the service cheaper than taxis, and in all probability less expensive than taking your car. And this is just the beginning. It’s not difficult to imagine a day when Google-funded Uber will use driverless vehicles to whiz passengers around cities. One of Uber’s stated goals is to make the service so good, and so affordable that people just won’t want to own a car.

In its own way, Uber is revolutionary, and it’s provoking a revolutionary response. Last month taxi-drivers in cities such as London, Paris, Berlin and Milan took to the streets in protest. Instead of invoking public sympathy however, all they did was stimulate demand with new customers racing to download the Uber app.

These are not the only wheels of change happening in transport, and being driven by technology. In Boston, an Uber-style bus-service called Bridj uses smartphone data to identify and pick customers up, and then select the best route to get them to their given destinations. ZipCar (now owned by Avis) uses technology to facilitate car-sharing. Part of the success of CitiBike in New York City is an app that allows riders to locate cycle parking stations and bike availability. And even the humble interstate bus is undergoing an overhaul.

I am writing this blog from a Bolt Bus, barreling down Interstate 5 from Seattle to Portland in the Pacific Northwest of the United States. I booked online on my mobile, scanned a code to get on board, and I’m now perched on a leather seat, making full use of the free WiFi. All for $17 plus tax to travel 173 miles (278km). Bolt (part of Greyhound) achieves the low prices by eschewing the physical – like ticket depots and premises – for an online-fueled experience. Just as I described Uber, Bolt is cheap convenient, clean, comfortable and contemporary. In New York, Bolt Buses depart for Boston, Washington, and Philadelphia every half hour.

All of the above examples provide real clues not just to the future of transportation, but also to how consumers want to operate today. This is the era of the customer in control, calling the shots on their own terms from a mobile device. They want an experience that is fast and as friction-less as possible. And, conditioned by years of “digital freebies,” customers also want a great deal. Those companies who can deliver to this higher set of expectations will triumph. Those who resist – like the European taxi drivers – will fail.

4 thoughts on “The Wheels of Change

  1. Hey Jon, great writing and content. It’s good to be getting yr blogs again. How’s the U.S. treating you?

  2. I respectfully put it to you (and in particular litigious Americans), that you want to
    “call the shots on your own terms from a mobile device. You want an experience that is fast and as friction-less as possible. And, conditioned by years of “digital freebies,” you also want a great deal.”
    … until it all goes wrong, and then you want someone to sue!

    I am not anti Uber per se, but if it, and other services like it (Airnb comes to mind), invest in licencing, meeting industry regulations, insurances, customer service lines, corporate taxes, government levies etc (ie, if the playing field was level with the incumbent provider), then the ride would not be $6.78.

    Recall that the light aircraft industry (Cessna, Piper etc) died decades ago due to the high cost and risk of litigation, and it took decades for society to reinvent the rules so that light-aircraft ownership is once again viable.

    Perhaps a criticism of Uber is that they changed the model before changing the rules.
    Perhaps this is a criticism that should be leveled at the State – who allowed them to do so.

    In many of the jurisdictions where Taxi operators are protesting, what Uber is doing is still technically illegal.

    Great thought-provoking post though. Thanks.

  3. Hi Paul,
    Great to hear from you. Thanks for the comment. And for taking the time to drop me a note. The US is going well thanks – how about you? Say hi to Stretchie and the guys.

  4. Hi Damian,
    I appreciate your comment, and the thought you put into it. It is true that the existing services are playing with their hands tied behind their back, but I think ultimately this is good for the customer, and Uber does have insurances ( and do background checks on drivers.
    Again, thanks for your commentary and point of view.

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