61–70 of 291 posts
Earlier quoted context omitted.
I wont switch. 80% of my ubers get expensed. Keep me fat and happy with rewards, and I'll keep expensing it regardless of the cost, which doesnt really effect me, only our controller.
So now Uber's competitors just have to market to your controller, which is in fact easier than marketing to everyone at your company.
What is Uber's long term moat/pricing power? To compete in a local market you just need to sign up 5000 or so drivers. At a $5 signup bonus that costs like $25,000. You can just be the third app, most drivers already swap between Lyft/Uber. You could even form a drivers cooperative and just give all the charges to drivers (like farmers do). Regulatory capture seems like the only real route to sustainable profits with…
Earlier quoted context omitted.
> "...you just need to sign up 5000 or so drivers. At a $5 signup bonus that costs like $25,000." that's nowhere near the cost of acquisition for a driver. having worked on driver acquisition, i can tell you it's hundreds of dollars, not $5.
Not trying to be rude, but can you explain your credibility a little further? I'm sure it would be interesting and add to the discussion.
Earlier quoted context omitted.
> "...you just need to sign up 5000 or so drivers. At a $5 signup bonus that costs like $25,000." that's nowhere near the cost of acquisition for a driver. having worked on driver acquisition, i can tell you it's hundreds of dollars, not $5.
Not trying to be rude, but can you explain your credibility a little further? I'm sure it would be interesting and add to the discussion.
To mitigate that, Uber and Lyft heavily subsidize launches in new cities by pre-signing up drivers well ahead of initial demand, to ensure low minute order fulfillment. This is done by giving drivers activity bonuses in the initial new-city market formation stage, no matter the actual orders. This ensures order low latency fulfillment for early adopters in new locales, which leads to customer satisfaction, word-of-mouth advertisement and soon enough full marketplace formation (and lock-in).
If you were trying to compete with Uber in New York City, the main problem you would have is that you'd need a lot of capital to have hundreds/thousands of drivers to ensure order fulfillment on average under 5 minutes by having a driver as close as possible to any new order being placed.
Convincing people (using money) to stay idle despite lack of initial order demand (until the marketplace is formed) takes more than $5 per driver.
Earlier quoted context omitted.
> "...you just need to sign up 5000 or so drivers. At a $5 signup bonus that costs like $25,000." that's nowhere near the cost of acquisition for a driver. having worked on driver acquisition, i can tell you it's hundreds of dollars, not $5.
Not trying to be rude, but can you explain your credibility a little further? I'm sure it would be interesting and add to the discussion.
People aren't desperate enough to hustle for $5. Even $200 is low. I'd consider that the minimum to even have a program worth running.
Earlier quoted context omitted.
So now Uber's competitors just have to market to your controller, which is in fact easier than marketing to everyone at your company.
Harder than it seems. AmericanExpress had outsized market share in the corporate travel market for about 30 years, even though it never struck me as a superior product to Visa-based cards. Not sure who they hypnotized to establish that edge, but it became strangely durable.
While my story is anecdata I wonder if it speaks to a broader issue: I'm an Uber super-user. I used uber 400+ times per year in 2015, another 400 times 2016, and then again 400+ times in 2017. Then my rides per year went to 0 in 2018 and 0 in 2019 so far. It wasnt about price, the app just became too buggy to the point of being unusable. The customer service became unresponsive. I simply switched to Lyft/Careem/Via.…
Earlier quoted context omitted.
So now Uber's competitors just have to market to your controller, which is in fact easier than marketing to everyone at your company.
I can see the add now "Save 4% on negligible travel costs for the low low price of pissing off your traveling employees who are generating million in revenue" It's not worth our controllers time to worry about something so insignificant.
I don't know what to say about this because as a lifelong value investor I cannot accept the valuation of Uber based on it's earnings. But the same logic held me back from investing in Facebook and Google, which did not make any sense to me at the moment of their IPO. How do I decide what Uber's earnings will be in five years?