April 14, 2016

What Can Entrepreneurs Learn From Consumer Infatuation With Uber?


So I got into a cab the other day; I was walking out of the train station to visit a client in Westport, Connecticut, a very affluent neighborhood situated less than an hour from New York City. Since I am in the on-demand space, I typically cart around the city in an Uber, Lyft, or my personal favorite, Via. But on this particular evening, I didn’t hail any of those services from my phone. I just stepped right into the first cab waiting in line.

It was immediately apparent to me why these guys are on the endangered species list.

In one of the most expensive zip codes in America, I stepped into a mid-’90s model piece of crap with duct tape on the seats and infused with the pleasant aroma of dumpster juice. I quickly remembered to ask, “Do you take credit cards?”

The driver was nice enough – friendly and chatty, knew every back road in town; he had been doing this for 20 years.

Those are two things you never see in the on-demand space. Most of the time, the driver doesn’t know where they are going and often has trouble following the blue dot on their screen. If you meet someone who’s been doing this for more than a year, they are like tenured industry veterans, with stories of the “old days” – like when Uber still had its original logo.

But what Uber and other ridesharing services lack in driver experience and driver retention, they more than make up for in technology and marketing dollars. They have tons of people who dedicate their days entirely to thinking of ways to get more people to use their services – something the cab companies never had to even think about outside of snagging an easy phone number to remember, like 777-7777.

I get so many emails each day from the various ridesharing services offering me discounted rides, 10 percent-off days, tell a friend and earn a free ride deals, etc. These companies even do deals with bars and restaurants and conferences, offering discounted rides for first-timers leaving from or arriving at these various locations.

And they go beyond discounts. These companies are finding very clever ways to embed ridesharing into other aspects of our life.

StreetI am also on the startup investing side of things, which might be why I think #UberPitch is a great promotion. This is where startup teams get the chance to climb into an Uber with an investor and spend a few minutes chatting with them about their business. I’ve seen this outside the U.S. as well, in places like Canada, India, and Australia.

Did #UberPitch bring in a whole bunch of new users? Not sure. I’m fairly certain, though, that the venture capitalists and startup teams already had some sort of rideshare services installed on their phones. But it’s a very cool thing to do, nonetheless.

Another great promotion was Uber’s partnership with the Animal Planet Puppy Bowl in February, during which Uber drivers brought puppies that were up for adoption to play with passengers. Uber is also working with the Humane Society and last year helped 70 puppies find a new home!

Two weeks ago, Uber ran a very cool marketing promotion with Marc Jacobs. The company covered a bunch of Uber cars with hundreds of daisies, promoting an event where people could pick up bottles of Marc Jacobs’ Daisy perfume during their trips simply by using the special code “MJDAISY.”

We’re going to start seeing a lot more promotions like this. They just make good sense. It’s amazing advertising for the rideshare companies and their partners. Maybe you can pick up a few ideas for your own startup’s promotional strategies?

Hmmm. I wonder if I accidentally typed in a #dumpsterjuice promo code when I got into the cab the other night.

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Joe Rubin is cofounder and director of corporate development at Crowded.com, a worker marketplace for the on-demand and 1099 economy. Previously, he was director and cofounder of FundingPost.com. FundingPost has been introducing entrepreneurs to investors nationwide for more than 15 years both online and through its VC and angel investor conferences in 23 cities. Joe has also invested in dozens of early-stage deals over the past several years, both personally and as a managing partner of ARC Angel Fund.