Uber's BIGGEST WEAPON against Ola, Rapido etc is now live in India
On 19 Dec, I paid Rs 99 for a monthly subscription of Uberโs new loyalty program (Uber One) ๐๐
On 19 Dec, I paid Rs 99 for a monthly subscription of Uberโs new loyalty program (Uber One) ๐๐
Since then I have earned Rs 783 as 10% credits for the 12 rides I have taken to and from places like Faridabad, Vrindavan, Delhi and Noida.
I discussed this with a senior friend at Ola yday, whose exact words were- โThis is A BIG THREATโ ๐
Intrigued, I spent 3 hours yday studying the possible implications of Uber One.
And this is all that my study taught me!
Uberโs home country, the US is the worldโs largest ride-hailing market.
And there, Uber One loyalty program for ride-hailing was launched in November 2021.
At that time, Uber held ~71% market share. And today, as per varied news pieces, it holds ~78% of the growing market.
Thatโs a huge impact delivered by Uber One.
..
But, why did it work so well?
Cuz, Uber offered Uber One subscribers 6% credits that could be used in the next ride.
This helped Uber increase loyalty among the USโ most frequent ride-hailers, with > 2.5 crore paying subscribers
This is evident from the fact that an avg of these 2.5cr Uber One users in the US spend 3x of what a non-subscriber spends on Uber (as per Bloomberg)
Result? Biggest competitor Lyft is left with users who donโt book cabs as often ๐๐
In a nutshell, via the subscription, Uber shares back a part of what it earns to ensure that the lifetime value earned from a user is maximised.
Thus, it earns less per ride, but more per user over time.
And Uber has played this very very well!
..
And this is where we come back to the Indian market.
As aforementioned, Olaโs already losing share. And Rapido and Namma Yatri are rapidly growing.
In this race, Uber One offering 10% credits back on every ride (vs 5-6% in the US) will help Uber ensure that the most frequent cab-hailers will find Uber to be the most affordable ride-hailing app
Plus, what do frequent users always want? Priority support and top-rated drivers, which Uber One promises
In the US it also offers perks from UberEats. And, to make up for it, itโs giving Zomato Gold subscriptions
..
Uber One was launched in India on 27 November.
And I was skeptical when I spent Rs 99 on the monthly subscription.
But, having earned Rs 783 as 10% credits, I was compelled to dive deeper into what its market implications could be.
And, my study says:
Uber will corner the high-frequency ride hailers with its policy to share back a part of what it earns and priority support, leaving rivals with users who have a lower life-time value ๐๐
This is the same as things played out with Lyft in the US.
What do you think?
Best,
Jayant Mundhra
Your articles are so crisps and to the point. Its gives us an good knowledge about topic. Keep doing great work๐๐