Strategic Management: Uber's Current Strategy and Alternative Strategies

STRATEGIC
MANAGEMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Uber’s Current strategy................................................................................................................3
Uber’s Current situation and performance..................................................................................5
Alternative strategies for Uber.....................................................................................................8
Effectiveness and benefits recommended by alternative strategies...........................................10
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Strategic management refers to the ongoing process of planning, evaluation, monitoring
and assessment of all areas and functions in an organization for meeting its corporate and
business goals and objectives (Trigeorgis and Reuer, 2017). Uber Technologies, commonly
known as Uber, is a food delivery service, vehicles for hire, freight transportation, Packaged
delivery couriers company based in San Francisco in USA and operates in more than 900
metropolitan areas around the globe. It is one pioneer in the formation of self-driving cars and a
company which is entirely based on gig workers, that is, independent contractors, workers of
online platforms, temporary workers and contact firm workers who work on demand with Uber
for providing their services. The organisation is currently facing challenges in market in relation
to closing down of operations and shutting down of operation, laying off a quarter of its
workforce. This project will determine the current strategy used by Uber, the in-depth analysis of
the current situation, alternative strategies that can be used to deal with the challenges and
effectiveness and recommendations of alternative strategy.
MAIN BODY
Uber’s Current strategy
In present times, Uber uses aggressive marketing and pricing techniques to grow in the
global market. Ansoff Matrix model can be used to explain the growth strategies that Uber is
implementing. The matrix dictates the strategies for growth in combination of markets and
product-based strategy that Uber has implemented for expansion over the years (Loredana,
2017).
Market penetration
It is one of the growth strategies suggested by the Ansoff Matrix, this strategy has
inspired Uber to increase the sale of its present products and services in the markets that Uber
holds currently. This growth strategy was used by Uber in the initial stages of its operations in
USA. It helped the company to increase its market share in the industry and eventually led to a
disruption of the Taxi industry. In order to go forward with the implementation, Uber used
aggressive marketing strategies for penetrating the market deeply and gain a large customer base.
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Product development
This strategy of the Ansoff matrix is also known as the product expansion strategy and
refers to introduction of new products in the current market. It is user for expansion of the
services and product portfolio of the organisation. It means the company can either produce and
launch a completely different product of can create an innovative or different version of its
existing products. Uber has a global foothold in various markets and uses tis strategy on different
levels and in continuous manner.
Market Development
According to Ansoff Matrix, in order to grow, a company can use market development
strategies for expansion into new and untapped markets for attracting new customer base for the
existing products. This strategy is based on the idea of market expansion. Uber has implemented
this strategy for accessing the foothold into new areas of operation, that is, new cities or new
countries as it aims at global expansion.
Diversification
The diversification strategy suggested in the Ansoff’s Matrix is considered on of the
riskiest strategies as organisation have to enter into new markets with new products or services.
It involves a whole lot of research of markets and product development along with high R&D
costs an innovation approaches which are in sync with the consumer demand. Uber has
successfully adopted this strategy. It was a taxi riding and transportation service company but it
took the huge risk of diversifying in the food industry when it started its operations in the area of
delivering food (Thelen, 2018).
Among all strategies Uber has focussed most upon Market penetration and Market
development. When it comes to Market penetration, Uber started merging their innovation with
market penetration by becoming highly competitive and reducing their pricing to gain a foothold
in the market. Various sales promotion technique was used which included TV advertisement,
Database marketing, Social media marketing, referrals and customer loyalty points. Uber started
providing promotional codes to all its loyal customers which enabled them to markdown their
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