Uber’s Barcelona pivot
Uber has just announced the launch in Barcelona of a new service, UberEATS, which has previously been tried out in Los Angeles as UberFresh, and which aims to deliver food to your door in 10 minutes. Restaurants, selected from PlateSelector, will offer two specialties each day that users can find on Uber’s app, pay by the associated credit card, and then watch on a map as their food makes its way to them across the city in 10 minutes or less. For the moment, there will be two daily menu options, but the plan is to expand the options as the service becomes more popular.
This is a classic pivot maneuver: reuse your team and its infrastructure to develop a new product that allows you to keep a foothold in the market, while exploring new business lines based on known knowns. In this case, the idea is to explore the concept of urban logistics, from moving people to moving products, as has already been tried out in other cases, using a network of drivers that the company will require to be registered as self-employed and to file a quarterly tax return. In the meantime, the company’s legal battles continue against the ban on its taxi service UberPOP. For the moment, the company says it has no intention of launcing UberBlack, due to the low number of taxi licenses issued by the Spanish authorities, which seem determined to keep them as scarce as possible, a move that in no way benefits the general public, and that for the moment makes it impossible to create a sufficiently large enough pool of drivers to offer stable, long-term passenger transport services.
The food on demand service is possible thanks to the establishment of limited hours of activity that will allow for an estimate to be made based on different factors so that the selected restaurants can work during down time. By offering a very limited number of dishes, it should be possible to meet the ten-minute delivery time within a relatively large area of Spain’s second city.
Not that Uber is entering a sector without competition: Delivery Hero and GrubHub in the United States; Just-Eat in the United Kingdom, Spain’s SinDelantal and La Nevera Roja, and Germany’s Food Panda. But Uber’s brand, its app, and its model of using a fleet of approved drivers will prove a powerful appeal to many users.
Uber wants to be seen as a tech-based logistics platform, not a taxi service. It has experimented with different services, some of which are still working, and others, such as UberESSENTIALS, which is now due to be cancelled. The idea is logistics as service, applied as you wish, with drivers, or with self-driving vehicles when this becomes possible. The company recently hired Tom Fallows, the former head of Google Express (Google’s same-day delivery service) to come up with new logistics ideas. If a market proves tricky to enter, the strategy is to pivot and offer different services until the legal problems are overcome. If anybody thinks that they may have overcome Uber, they should remember that they might have won the battle, but that a long, long war remains to be fought.
(En español, aquí)
