by Sarah Plasky
“As the fairy tale goes, Uber was born on a snowy night in Paris in 2008, when Kalanick and his friend Garrett Camp could not get a cab. The two vowed then and there to solve the problem with a revolutionary new app. The premise was dead simple: push a button and get a car.” Full Article
I cannot remember which astute Simon Business School professor said, “If you cannot find something you want in the current marketplace, it has the potential to be a product.” But the idea stuck with me and I learned first-hand with Aquavation® when I Googled to create a custom water bottle for my husband’s century ride, and all that came up was bulk ordering of hundreds of the same logo stamped cheap corporate schwag.
But I just wanted one!
As a closet economist, I genuinely see beauty when two curves hold the promise of efficient markets as they join real-time supply and demand data together. But I see no beauty in waiting for things and I despise carrying cash. I decided on a recent trip to NYC to try out Uber and see what all the hype—and the $18.2 billion valuation—was about. To my surprise, I am hooked, hooked, hooked. Hooked from the minute I stepped out into the taxi line at LaGuardia Airport opened my Uber app, got a text from ‘John’, and the car arrived to my exact GPS sidewalk location. All within 3 minutes. Nice chat with the fellow from Tajikistan in his personal, clean Toyota Camry and I simply jump out when I arrive at MOMA. No cash. No tip. Everything is automated and communicated on my smart phone. Fares are based on a calculated rate and I could choose a level of service. This time it was $39, a great discount, as my last taxi from LGA to Midtown was $49 + tip.
Once I encountered a published and much talked about ‘surge rate’ and it made complete sense given it was Manhattan rush hour. One driver told me regular Uber users have learned to just wait 15 minutes and most times it changes. As CEO Kalanick says in the current Vanity Fair article, “You want supply to always be full, and you use price to basically either bring more supply on or get more supply off, or get more demand in the system or get some demand out,” he lectures like a professor. “It’s classic Econ 101.” I agree. I did not feel cheated or taken. Let me say, to be picked up in a Lincoln Town car a day later at my hotel and driven in luxury to the airport while paying cab rates, because the limo was empty and the driver was seeking utilization was a living example of my beloved supply and demand curve in action. Aren’t you just chomping at the bit to join? Click here to you get $30 off and I earn a free ride!
This is the start of on-demand consumerism.
Uber means being a superlative example of its kind or class and the minute you step out of the car you are sent your receipt and a rating scale to size up your experience. Uber is not just a disruptive cab offering, it is about the potential of real-time delivery. Several movements are of great interest to me as an Entrepreneur. The Maker Movement is one I intend to hit on in another blog. The other is how companies like Uber are moving to offer products and services when and where they are needed at the point of want. Not only I am sensing another one of those beautiful curves here, I see an opportunity here.
Existing Businesses: You ask your customers what they want. You most likely have a deadline or delivery schedule for when they will receive it, but can you look at the Uber model and think different?Entrepreneurs: As you build it, how on-demand can you make it?
Since I am a social entrepreneur I cannot resist mentioning two giving aspects of Uber: