How would you acquire more users for Uber?

  Uber
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Answers (4)

Clarify

  • Any specific geography? Assume global
  • Is this specifically related to pandemic worries? No
  • And are we talking about the riders? Or the drivers? Riders given Riders drive demand

Goal

  • As the problem states – more Users
  • Is revenue increase also a goal? Or can the increase in users come in at slightly less revenue per user? – Assume – Possibly yes

Ultimate goal of Uber is to help consumers move from point A to point B by creating a marketplace by connecting drivers to riders

Current Users: Let me segment the users as below:

  • Business travelers – who go on regular business trips
  • Daily regular commuters – who go from point A to point B regularly – say for example office to work
  • Casual travellers – others taking trips

Let me pick one or two User segment and try and see if we can solve some of their pain points that could help bring in more such consumers

  • Let me pick the Business and regular commuters as I feel there are some synergies among the two user segments. They are both commuting the same routes regularly

Some proposed ideas:

  1. Fixed pricing – going from point A to point B regularly – for example the business user goes from Home to airport and back. Regular users from A to B. Can we offer them fixed pricing? This will A. Create stickiness B. Get more user if the pricing is favourable. One caveat here, for Business Travelers, for most parts, pricing is not an issue given it is covered by the respective companies
  2. Priority access – These users get priority when ordering cabs
  3. Wifi for such users in the cab – These users tend to be on the road a lot (especially Business Users), enabling wifi in the cabs so they can catch up on work could help create more stickiness. Especially helpful in emerging ecomomies where cellular plans might not be mature

Implementation – Would like to do an ROI analysis of the ideas agains the goals

IdeaImpact on the GoalImplementation effortNotes

Fixed Pricing High M This is not a trivial change and changes the business model and will have an impact on Revenue.
Priority access High L People dont like waiting and this could really help with repeat users and even new users
Enabling wifi L H This is dependent on cars being Wifi enabled and also supporting drivers to make it available and will have broader cost implications

I would like to pick #1 and #2 given they are likely to have a big impact on the User growth.

Metrics: I would like to test it as follows

Would like to test it out for a subset of users first. Pick a highly frequented route for example say an airport to a couple of neighbourhoods.

Offer fixed pricing and Priority access to a subset of users

Measure:

1. #DAU that are utilizing the new services against overall users

2. New users utilizing the new services

Measure the above over a month to get a better sense of User growth.

Clarifying Questions

  • How do you define users on Uber? (Drivers? Riders?)
  • How do you define a new user? (e.g. someone who has never downloaded the app, lapsed user, someone who has downloaded the app but never used it)

Structure of Answer:

  • For the purpose of this question, I will focus on riders because I am predicting as rider demand goes up, driver supply will too.
  • First, I will review the goal of the product, then I will go into the problems faced by the product, next how I would solve these problems, how I would implement these solutions, and then how I would validate my solution.

Goal of Product

  • Goal of product is to transport as many users as possible from one destination to the next in order to earn revenue from each ride taken.

Problems Faced By the Product

  • Uber has  become a household name and captured a large portion of the market for your core ride use cases (e.g. getting to work, the airport, a friend’s house). In order for Uber to grow, it needs to cover more underserved transportation use cases.

How I Would Solve This Problem

I would solve this use case by expanding Uber’s product line and serving underserved users who may have unique or different transportation needs.

I would evaluate alternative transportation use cases that aren’t currently served by Uber or the other ride sharing apps.

Here is a list of other transportation use cases that I believe are underserved by on demand riding apps  and other transportation methods (e.g. public transportation) where Uber could differentiate itself to grow its user base.

  • Users traveling to and within foreign cities by car and want tours of the area.
  • Users require limos for weddings, special events
  • Users require  transportation by water (e.g. boat, ferry, etc) to get from one point to the other as it is faster than driving
  • Users require plane transport on demand to get from point A to point B

Possible Solutions

  • For the use cases outlined above, I am going to focus on use case #1, travelers who require car rides as I believe this group has the highest growth potential and are underserved. Better serving this customer base will enable Uber to differentiate themselves from competitors and other modes of transport

Travel Use Cases

Priority Customer Impact (5 being most impactful, 1 being least impactful) Complexity (1-5)
1 being most complex, 5 being least complex
Value Score (customer impact – complexity) Use Case Possible Solution
A 5 1 4 Traveler getting from point A to point B for an event and want to take a tour, can select the “scenic route” Give users option to take “the scenic route” when applicable to give them the ability to navigate past major landmarks or nice views
B 4 2 2 Traveler has extra time, wants to schedule a dedicated driving tour Enable uber to provide recorded  tours while driving to entertain travelers in an easy, accessible way without having to engage an external service
C 4 3 1 Traveler wants to take a walking tour Enable recorded walking tours in major travel destinations
D 5 5 0 Traveler wants to take a day trip and combine public transportation and uber Travel planner for those travelers who have to take multiple modes of transportation and allow uber to integrate with public train times, public bus times, etc. This will allow uber to know when public transport is delayed, relaying this information to driver and planning pick up accordingly

How I would Implement the Solutions

  • I would implement the solutions 1 & 2 because they will increase Uber growth and differentiate Uber from other ride sharing apps, allowing them to gain even more market share.
  • I am not prioritizing solution 4 as it requires a high level of content. I am not prioritizing solution 5 because it has a high level of complexity and requires partnership and cooperation with public transportation methods, which can be viewed as competitors and might not cooperate.
  • For the first prioritized solution above, I would integrate an option to take the most scenic route. I would start with the major known tourist hubs and attribute all major known landmarks. I would build an algorithm for these cities to incorporate these new datapoints and then build “a ride” where these landmarks can be easily viewed by the car. This option will differentiate Uber from other ride sharing apps enticing  new users to opt for Uber over competitors and even join Uber while traveling for business/pleasure, etc to improve quality of transportation.
  • For the second prioritized solution above, I would work with travel and touring experts to make recordings of driving tours. Utilizing the scheduling feature already embedded in uber, I would integrate an option that allows the users to “take a tour” and then the app could play the recording in the uber car. Users could even take the tour in their own or different vehicles (at a cost) creating additional revenue streams for the app. “Driving Tours” also create another use case where users would utilize the Uber app, growing its rider base.

How I Would Validate These Solutions

– For both features, I would measure the usage of the features and look at who is using the features. Are new users using the feature? Are these users staying with the app? Validating the solution by asking these questions would allow me to understand whether these features are effective acquisition tools for Uber. My primary metrics would be # of DAU, # of New Customers utilizing these features and customer satisfaction of these features, and finally # of DAU and MAU who utilize Uber moving forward after interacting with these features.

This is an interesting problem. To start, I’m going to assume that we are talking about Uber (share ride) users and not UberEats. Although both can go hand in hand, I think each play to attract users can be different. So for the sake of time and to pick a certain product, we will go with Uber’s main product — ride share.

What is Uber? Uber is an app that connects you to a ride/driver to take you home, work, airport, or where ever you may choose within a range. We can break down two main users– the driver and the rider. For this practice, we will focus on increasing riders. We can also break down the type of riders that Uber can penetrate and get a bigger market share:

1. Corporate Users: This would be for companies to provide rides to workers or stay long for work
2. College Students: Self-explanatory– and want cheap rides close to or around campus
3. Elderly: This would be for elderly people who at above 55 years old and would need rides to/from hospitals paid for by their insurance

I’m going to select college students because of a couple of factors:
– Most universities/colleges already provide a share ride taxi or trams for students
– Typically, riders are supposed to be 18 and over. Students tend to start university at 18 and we can dominate the market and get them to join Uber over other alternatives at an early age.
– Students are price and time sensitive (just like Uber)!

A couple of the pain points and reasons why this could be useful for students and university is that:
– As a student, I don’t want to be walking home late from the library
– As a student, trams don’t go close to where I live and I tend to have to walk 15 mins more
– As a university, this might be a cheaper alternative than hiring our own drivers or trams to run

Solutions:
– Partner with universities/colleges to provide a wholesale package to be the main ride provider for students within a 2-mile radius–the university would pay for this product.
– Sell students at the beginning of the year ride tickets– for example 10 rides within campus/$25 per work (numbers to be figured out)
– Provide Students a discount within campus grounds– for example $1/per ride

(I wish I had more solutions, but I’m blanking! Feel free to add!)

Out of all these, I would partner with universities. The reason is that the main goal of this is to increase users. Although we aren’t talking about revenue/profits, we are able to utilize a business line of a university/college to increase users for the long-term play. If we are able to penetrate users and build that trust at an early age, those users will tend to rely on Uber for all their transportation needs outside of campus grounds.

The way this would work is– we would get an approved EDU email list of active/current students, next we would send an invite to join Uber at the beginning of the year to use around campus. Pending on how the deal would be structured with universities, we wouldn’t charge the students. Rather, we would charge the universities as a replacement for their current trams/student transportation. Let’s assume that the average college/university is 5,000 students– 1k/per class (including grad school), we are looking at over 1k new users a year/per school (assuming all freshman don’t have Uber AND some grad students and transfer students entering already had it).

A couple of drawbacks that I would be worried about is:
– Not enough drivers to do demand
– Drivers don’t like short rides because of low pay (maybe inventivize them)
– Might only be good for schools with certain # of students, endowment, metropolitan location
– Uber might lose money initially when getting these users– need to calculate CAC

In terms of metrics, it’s pretty self-explanatory that the metric we would like is # of new users added (maybe at the beginning of the year), # of rides taken during the school year and after from users, and on the long-term engagement for users once graduated (just to track :)!)

In summary, I think this would be the best way to penetrate new Uber users. There wouldn’t have to be a change for drivers. Technology wouldn’t have to be updated. Say hello to a couple of thousand new student users yearly!

This particular Uber product strategy interview question calls for asking clarifying questions.

Clarifying questions: Uber does ride-sharing as well as Uber eats. Uber eats is a small % of their revenue so let’s assume we stick with ride sharing. For ride-sharing, Uber has 2 main users – the drivers and the riders. For the purpose of this exercise, let us stick with acquiring more riders. This also seems like the first logical choice because a higher demand from riders will result in more drivers (to make money) and not the other way around.
Goal: To acquire more riders on the uber platform.
Users and Use Cases:
Professionals – who commute daily to work instead of driving or taking public transport
Students – who shuttle between dorms and class when they are getting late. Example of groups.
Young professionals – who like to go out at nights to party without the worry of the designated driver.
Airport Commuters – who like to go to and from the airport on a regular basis

Let’s pick the Young professionals who want to party as the user because of the following reasons
1. Higher income range – leading to better tipping,
2. More likelihood of uber X,
3. longer trips (they typically won’t go to the same neighbourhood places and
4. round trip opportunities – they have to come home late when their best option is Uber).
5. A large market – if you assume ages between 21-35 and assuming an 80-yr lifespan and uniform distribution, your market size in the US is (15/80)*320 million = 60 million. Not all are tech savvy and in applicatable areas so let’s drop that to 50% – since thats a good guess for people in big metropolitan areas where Uber has the biggest customer base so 30 million.

Ideas for increasing users
1. Partnerships with Opentable – Uber could tie up with reservation systems to provide discounts to users going to that location. The key here is marketing and the solution would be to tie up with opentable to detect reservations and provide a pre-booking workflow. Users upon reserving could directly book an uber with $10 off as an example. Uber could also provide menus and ordering during the commute for a great customer service

2.Detect DUIs before they happen – Uber could provide handheld machines at all bars that users can use for free (or minimal service) before checking out. If a user checks at > $0.08, Uber should volunteer to provide a car for the user to get home or suggest to the user to wait. It would be legally impossible to detain or report the user against his or her will. This is easy to implement – devices are available, generally makes the roads safer and has a clear way of increasing customers. Since this is at peak time surcharge rules apply allowing for higher monetization

3. Strategic partnerships with Live events
Most live involve large groups of people, space constraints and parking challenges. For e.g., Uber could partner with the NBA to be the preferred transport mode for fans to and from the NBA finals. This reduces traffic congestion, eliminates parking problems and allows Uber to demonstrate the value of the product and retain more customers.

If I had to pick one solution, I would pick #2. If you put all 2, it solves a real problem (safety), it is extremely easy to implement, handheld breathalyzers now connect to the iPhone and it can scale very easily throughout the country. It is also innovative, extremely useful and understandable in terms of value prop. The only challenge is the bar to entry which requires new users to install the app. The booth at the location could make this seamless but even providing a phone service in exchange for personal information.

The metrics would be new new Uber users, uber rides/user/month, 7 day/30 day repeat users, net reduction in number of DUIs in an area (say if you partner with 25 bars in Hollywood, you should see a noticable difference)