Google, you are not fooling anyone, Ridesharing isn’t a transportation business, it’s the future of advertising.
I was reading an article on Bloomberg about how Google is going to start a competitor to Uber. I wanted to write a short blog on it, but then it hit me. Google isn’t in the rideshare business and their self-driving cars are not to ferry people from point A to point B. Google is in the advertising business. Now that is the blog I want to write.
It dawned on me that Google is really my competition. (We recently launched Vugo, A Rideshare Advertising Service)
Luckily, I am not alone. Google’s move into the rideshare business with their self-driving cars is also a threat to Apple, Uber, Lyft, Tesla, and others.
Why isn’t Uber already doing advertisements?
Is the first question I am asked by people when pitching my startup. My best answer is that its likely because they are a “Transportation Network Provider” specifically, and not a transportation company. They are in the process of fighting allegations that prove their drivers are not employees.
One of the tests to determine if drivers are employees is if the alleged employer can exert significant control over the driver. If so, perhaps the driver is an employee; if not, they may be an independent contractor.
Why would Google want to double-cross Uber, their current partner, for an industry as competitive and well-funded as ridesharing?
The answer is actually pretty simple: Rideshare Advertising.
How Valuable is Rideshare Advertising?
Google’s self-driving car wasn't created for giggles. In my opinion, it was created because of a long-term plan to bring Google’s Advertising platform, Adwords into the real world via it’s driving cars. If Google is successfully able to merge Ridesharing, Self-Driving Cars and Adwords — Uber would no longer be able to compete on pricing alone. Google would be able to realize cost savings from not having a driver, and gain additional revenue from having integrated advertising to subsidize the cost of the vehicles.
Today outdoor advertising is an 11 billion dollar industry, the value of these three things combined would make outdoor advertising look small.
What happens to Uber without Google?
Additionally, without Google Maps as a partner, Uber would be forced to rely on another map provider and considering that Google also owns Waze, they are left with Apple Maps and MapQuest. Neither of whom really bring much to the table competitively, making Uber look like Johnny Cab.
What better place to influence the American people than inside their vehicles while they run their errands.
Below are a couple of scenarios.
- Bob is searching for a new mortgage online during the week. That weekend, while he is picking up groceries from his local Target. Bob sees an advertisement in his Uber as it drives him to the store. A mortgage lenders office in the same shopping center is offering a $50 gift card to Target if he speaks to a mortgage specialist. It allows Bob to select an available time slot, and enter his name and phone number to redeem the gift card.
- John and his friends are visiting Vegas for a Bachelor Party around 2:00 AM. They are tired from parting all night and have decided to take a Lyft home. They are starving, but don’t feel like going anywhere else. A advertisement in the back of the Lyft displays as advertisement for pizza delivered directly to their hotel around the time they arrive. They are able to click a button, choose their toppings and buy without entering their credit card information using Google Wallet or Apple Pay.
- Jill is coming home from watching her favorite team make it to the big game, she is able to buy tickets for the upcoming game using a ticket broker in the back of the vehicle while she is experiencing the glory of victory.
The bottom line is that applications of rideshare advertising are endless. How valuable are the leads, purchases, and advertising being displayed in the back of rideshare vehicles?
I will let you be the judge of that, but I am sure that Google already knows that number.
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