Uber: Marketing in the Age of Decentralization

Something is changing in the way we do business. There was Wikipedia, which revolutionized the way we find information and led to innumerable pleas from high school teachers across the country to “not cite Wikipedia as a source.” Then there was Craigslist, which brought the same simple organization and consumer sourcing to an economic level. Today, the decentralized economy is spread across mobile devices and servers, gaining more users and penetrating more markets than ever. 

With companies like Uber and Lyft, we often talk about the disruption they have caused in their economic niches. Uber’s independently contracted drivers and user-friendly mobile platform have propelled it into fierce competition with taxi companies. And as Uber continues to grab a larger market share, they are also taking up marketing spaces.

Nothing Promotes a Car Better Than a Car

One marketing space that Uber has completely changed is car brand promotion. Think Scion for taxi cars. Or even think of the reputation of retired Crown Victoria squad car.

This type of brand promotion was something taxi companies were able to use to their advantage to get fleets of cars. Toyota, parent company of Scion, receives free publicity and riders were able to correlate quality that comes with being in cars that perform well in city environments.

With Uber, the market for this type of brand exposure appears to be wide open. Though Uber offers financing options for drivers with Toyota, Ford and GM, there’s no real limitation on what brand of car drivers use, provided the car is street legal (sorry, Fast & the Furious fans).

But What About the Top of the Car?

Another marketing space displaced by Uber is the classic rooftop pyramid ad. For years, marketers have honed their taxi puns and, working with cab companies that own hundreds of cars, marketers could be sure that their ads would reach across the city.

With Uber, the vehicle is ultimately owned independently by the driver and, in some locations, the cab service prohibits outside ads. Look for Uber to potentially push ads to users, as rides are about to arrive or as soon as the ride begins. This could allow for users to receive notifications for events occurring within hours of getting in a car for a ride.

You Can’t Ignore Anything on the Inside of the Car

The prohibition of taxi ads isn’t complete. Delta Airlines, for example, recently placed USB ports on the passenger seat headrests of Uber cars in New York City to promote their long-distance flights.

A startup called Viewswagen is following suit by offering drivers a few dollars per hour to host a passenger-facing tablet in their vehicles. Though Uber discourages this kind of advertising, there’s ultimately not much they can do to regulate what people have in their personal vehicles.

What About Promoting Safety?

Uber’s success has not gone unnoticed, but neither have safety issues associated with getting into cars with strangers. The barriers for driving with Uber are significantly lower than driving for a cab company. Both require a Commercial Driver's License, some form of car insurance, and a background check.

Cab companies also require a fingerprint record and application fee. Safety has become a concern due to reports finding Uber drivers with long criminal histories, and a lengthy list of Uber-related sexual assaults.

Some cities, like Chicago, have tried to implement new ordinances that would both help negate the risks of volatile drivers and help the old guard of taxi companies. Chicago currently prohibits Uber drivers from making airport pickups and requires the Uber logo be displayed on car windshields while in service. New ordinances pushed for comprehensive GPS tracking of all Uber drivers as well. Of course, Chicago also prohibits advertisements.

Breaking Free

The future is still unclear regarding Uber, its competition with traditional taxi companies, and government regulation. However, the restrictions in place today are not likely to stay forever if Uber’s popularity continues to surge.

Taxi companies continue to be competitive, but largely due to regulations that keep them competitive. And regulations now seem to be loosening as Chicago Mayor Rahm Emanuel has proposed allowing Uber drivers to make airport pickups with a five dollar per-ride fee. The Mayor’s proposal recently caused Taxi drivers to strike, shutting down cab service at O’Hare and Midway airports.

It’s a gradual transition, but it seems only a matter of time before the decentralized sharing economy wins out. If Uber cars are one day allowed to fulfill their own individual marketing destiny, we will all be along for the ride.