Uber's Strategic Analysis and Growth Strategies

This assignment provides a detailed analysis of Uber's business strategy, using tools such as SWOT analysis, PESTLE analysis, and Ansoff Matrix. The report assesses the company's strengths, weaknesses, opportunities, and threats, and suggests suitable growth strategies for achieving success in the UK market and emerging markets like India.

Uber Global Business Strategy
and Analysis

Table of Contents
INTRODUCTION..........................................................................................................................3
Internal and external analysis..........................................................................................................3
Identification of Company’s Sustainable Competitive Advantage.................................................5
Recommendations ..........................................................................................................................6
Implementation issues.....................................................................................................................8
CONCLUSION...............................................................................................................................8
REFERENCES...............................................................................................................................9

INTRODUCTION
Business strategies are defined as a high level policies of an organisation which are
created by them for achieving preset business objectives. In other words, It is termed as a master
plan of a firm through which, they can achieve a competitive advantage in the marketplace for a
long period of time. In addition with this, It is a set of actions that are used by the firm for
attracting a large number of customers towards their offerings. The present assignment is based
on Uber which is a transportation company with headquarters in California, U.S. Internal and
external strategies of Uber will be discussed in this report. In internal SWOT analysis and
PESTLE analysis for external strategies along with Ansoff matrix will also covered in the
assignment. Ansoff analysis is used for providing recommendation along with implementation
issues of different strategies in Uber will also discuss in present report. UBER is known as Uber
technologies Inc. which is engages in taxicab, food delivery etc. It is a TNC (transportation
network company) which is based in California. It is providing its services through websites and
mobile applications. It has more than 11000 employees who are providing their services in more
than 20 countries along with covering 785 metropolitan cities. UBER is providing services such
as helicopter, boat, taxi, online food delivery etc. in some selected cities around the world.
Internal and external analysis
Environment plays an important factor in the working of company as it directly
influences profitability and success of any organisation in positive or negative way. Internal
analysis is important for the organisation because it gave information of strength and weakness
to the management. It is necessary for conducting SWOT analysis because with the help of it,
Organisation can easily identify their weak areas and improve them accordingly (Baumann-
Pauly, 2013).
Strength Weakness
 Organisation has a long experience in
this field so they can provide their
services to their customers at low cost.
 They provides their services on time to
their customers (Tallman,2018).
 Taxi drivers are not recruited by the
 There is a lack of coordination with
their drivers which gave wrong impact
on the brand image.
 Incentive scheme of the company is
very low which is demotivating its

UBER they are on contract basis.
 Organisation has good advertising
technique due to which company has
achieved competitive advantage in
marketplace.
drivers
 Their idea can be adopted by anyone
which brings negative impact on their
goodwill.
 Their working culture is not ethical
which creates dissatisfaction among
customers.
Opportunities Threat
 They can adopt more technical
advancement due to which they can
easily attract a large number of
customers towards their offerings.
 They can develop their business
activities in growing countries such as
India because taxi services are
inconvenient and much expensive in
such nation.
 They can adopt electric taxi services in
future through which they will
decreases their cost and increases the
profitability of company in well
manner.
 Drivers are not performing their duties
in well manner which decreases the
brand images of firm.
 New legislations of different country
such as Germany which can ban the
operating services of company.
 Due to joining of new markets and
drivers as well as increases of frauds
and scandals damaging the brand of
company.
It has been identified from the SWOT analysis that the company has created a good
brand image in the world which defines a good position of the firm in the marketplace. On the
other hand, they have various weaknesses such as working culture, lack of coordination etc.
which can be improved by the managers through taking them in consideration and makes them
their strength (Weimer, 2017). With the help of it, the managers of UBER will easily implement
strategies that will be helpful for them in grabbing opportunities such as technical advancement,
expansion of market etc.

External analysis – External environment refers to all the factors which can not be
controlled by company and directly influences business operations in many ways. Uber should
be well prepare and aware of factors which might hampered their performance in a negative
way. Management of Uber have decided to expand their business activities in Germany
therefore they have to analyse some factors which can affects the brand image of company from
externally such as economical, political, technological etc. which is more explained through
PESTLE analysis as under:
Political – These are the factors which are controlled and regulated by the ruling
government. This factor includes change in import-export policies, tax duties, which provide a
huge impact on the preset objectives and operational activities of a firm. As Germany is a
democratic nation and wide population area which brings profitability for the firm. Instability of
UK government reducing the brand image of organisation due to which, they have to expand
their business activities to Germany (Piercy, 2016).
Economical – This element consists various factors such as fluctuations in tax rates,
crisis in a specific nation, instability of economy etc. Germany is 2nd largest exporter in the
world due to which the standard of living of the residential are very high. UBER can take
opportunities from the expansion in terms of increasing revenue and low tax rates of the
Germany. Instability of UK economy and increases in tax duties provide threat to company due
to which, organisation wants to expand their business in Germany.
Social – Social factors are connected with social environment of marketplace it includes
various factors such as demographics, cultural trends etc. As Germany is a big country and the
people of nation are mostly educated and prefers local transportation system for travel which
will make opportunities for UBER at the time of expansion. UK government impose strict rules
and regulations due to which, organisation are facing so many difficulties in their operations.
(Lirong, 2012).
Technological – It is the factor which is based on up gradation of technology or
adoption of digital techniques etc. Upgrade in technology will persuade to better quality of
services provided to the customers so to enhance their customer experience engagement which
will boost their goodwill in the market. Germany is a large country and the third largest auto
mobile producer in the world due to which, UBER can take opportunities from it in terms of

acquiring new technologies which can be used in process of manufacturing. Whereas, the
updated equipments are expensive in the UK market which provide negative effect on the
company.
Legal- These factors are related with rules and regulations of the countries like labour
laws, working conditions law, wages act, discrimination act etc. The legal factors are stable in
nature so UBER will not face any difficulty at the time of expansion in Germany. Whereas the
legal laws of the UK government are changed over the time due to which, company faces so
many issues in the UK market (McMillan,2016). Company should follow all rules and policies
which are set by local and central authority so to avoid legal issues which could be imposed by
the government.
Environmental- This kind of factors are connected with the nature and atmosphere of a
location. As UBER is providing transportation services in UK so the local people are facing
various issues such as over-crowding of traffic, pollution etc. For this, company can introduce
electric taxi cars in Germany which will increases the attraction of their customers. Main focus
of Uber should be to reduce environment pollution they are creating as it deteriorates the
environment and goodwill of company. They can improve it by doing charity to needy schools
and hospitals, conducting campaign so to increase awareness regarding global warming etc.
It has been concluded from the above analysis that company can determine the impact of
such factors on the business operations and activities of firm. When the laws and regulations of
the government are followed properly then firm can focus on the operations in a better manner.
When such laws are not followed it can lead to huge penalties from government and also the
customers will attract less towards the offerings of firm. The brand image of firm will also
reduced when laws are not followed properly (Overall, 2017). The managers of UBER have to
determine all the major aspects of various laws and regulations such as environmental law, legal
laws etc. which can adversely impact the business operation and it will hardly for the managers
to make effective strategies. Hence, the managers of firm have to consider all the main factors
which can impact their operations in negative manner. With the help of this, they can make
effective strategies and implement them in their activities and operations in effective manner.
Identification of Company’s Sustainable Competitive Advantage
It is very essential for an organisation to identify its strengths and weaknesses in the
marketplace. Because through it, organisation can provide better services to their customers

rather than other similar firms and gave a tough competition to its rivals for a long time period.
As UBER has a huge customer base and want to know their abilities in order to achieve
competitive advantage. For this, the management of UBER should use Porter's five force model
which are further described as under:
Porter's five force model – It is a model through which organisations can analyse the
competition of a specific sector. There are different types of factor which have to monitored and
analysed by the managers on the regular basis so that firm can easily identify the threat and
opportunities in future. This model is divided in five parts which are briefly explained as under:
Industry rivalry – UBER provide transportation services in various countries. But now
they wants to provide their services in Germany. There are some existing competitors such as
Lyft and curb who can defeat them in German nation. Therefore they have to make specific
plans and policies for expansion. Industry rivalry is high in nature as there are different types of
local companies which are giving direct competition to Uber in Germany. With the help of
policies and strategies, the management of UBER can easily compete with the local players in
Germany and grab the competitive advantage in the marketplace.
Threat of buyers- the threats of buyer is very high due to various competitors in the
German market therefore, Company have to provide transportation services at low prices in the
Germany due to which they will attract buying behaviour of large number of customers. As the
customers of nation are mostly educated. Company wants to launch electric taxi in Germany. so,
they have to consider such elements due to which they will not face any difficulty at the time of
expansion. Power of threat of buyers are high as there are more than 5 millions customers who
are using taxi services on regular basis. Company have to change their pricing and products they
offered according to customer needs and demands so to acquire more market and customer
share.
Supplier bargaining power – It defines the efficiency of suppliers which increases the
prices of services of organisation. As they are depends on the cars which are owned by the
drivers so they have less threat from the suppliers in Germany. The electric supply is very high
in the nation so they can easily introduce their electric taxi in the country through this, the
customer will attracted towards the new offerings of firm which will helpful for the firm in
taking competitive advantage in the marketplace.

Threat of substitutes – As the company have long time experience in transportation
service so they have to make effective strategies for the expansion in new location. As UBER is
well known brand in terms of providing quality services to their customers so the management
have responsibility to provide quality services to their customers in Germany due to which, they
will not move towards substitute services. Therefore, the threat of substitute are high in the
nation. The management of UBER have to provide effective margin to the suppliers through
this, the loyalty of suppliers towards firm will be increase which assists the management in
taking competitive advantage in the market.
The threat of new entrants- If the new entrants will come towards transportation
sector they have to follow various rules and regulation which are created by the German
government. In this industry huge money is required to start an business due to which threat of
new entrants is low. It is a positive point for Uber as they have to deal with the existing players
so to gain competitive advantage.
Recommendations
The company has faced various challenges from the UK government such as the
company has pay the penalty of £385,000 in the year of 2017 for hacking the data of customers.
It reduces the brand value and profitability of firm. Thus, the management of firm have decided
to expand their business operations in Germany country. The Germany nation is a land of
business in which several organisations such as small to large that are running their business
operations in effective manner and the government of Germany are also providing various
opportunities to the new entrepreneurs and businessmen so that the management of UBER can
easily expand their business operations in that nation (Lasserre, 2018).
Strategic recommendations to the management of UBER are based on Ansoff matrix
Ansoff matrix
It is a technique which is used by the various companies for making plans and strategies.
With the help of this, company will able in identifying a way in which they can use the plans
and policies in order to getting growth. UBER adopts this tool for making effective strategy
which can help them in getting future growth and sustainability. This model is divided in four
parts which are given as under:
Market penetration strategy – It focuses on providing products at low prices to the
customers in a same marketplace for enhancing the sales and revenue. It could be the perfect

strategy for UBER as they have ample amount of reserve in their balance sheet which would
assist them to beat their competitors. Through this strategy, Uber can enhance their market share
in transportation sector of Germany. As UBER has the huge customer base in the marketplace
so they can reduce their prices for defeating their local competitors. The sale will automatically
increases when a large number of customer will uses the offerings of the company then the
margin will not matters.
Product development strategy- According to this theory, organisation have to
introduce new products and services in the current marketplace with modification in their
existing products. Through improvement in services and goods, UBER can attract a large
number of customers towards their offerings. If they will adopt this strategy, they can also
introduce new products in the UK market which will help company in achieving huge market
share and profitability in the marketplace (Peppers, 2016).
Market development strategy – This theory says that company have to offer their
existing products and services in the new market. When UBER develop their customer base in
new market then they can easily expand their business activities in whole UK along with a huge
market share.
Diversification- This theory says that organisation has to introduce a new product in the
new market in order to expanding their operations, goods and services. Main aim of this
approach is to acquire different types of customer from around the Germany with different
products and services offered to them so to reduce overall risk for company. With the help of
this strategy organisation will reach in those marketplace where the transportation system is very
low or declining condition. This strategy is expensive because there is a huge investment
requires before expanding business activities in other nation.
From the above strategies, It can be suggested that UBER have to adopt diversification
strategy because it will help them in increasing their market share and profitability in German
market through their new product such as electric taxi. Through this, UBER can develop their
large customer base in new market areas along with a huge market share and they will also
identify their weak areas which can harm them in future time.
Implementation issues
When UBER enters in a new market area there are various type of issues which can
harm the brand image of firm they are more explained as under:

Risk – UBER have to analyse the market area of UK because if they will not understand
the requirements of the customers how can they provide better services to them. Therefore,
management of UBER have to consider such risks which can harm their profitability.
Stakeholder perceptions- If management will not take support from their stakeholders
at the time of expansion they have to bear a huge loss in the future which gave a wrong impact
on the brand image of firm. So, they have to analyse the market conditions and take proper
support from their stakeholders at the time of expansion (McMillan,2016).
Resource constraints- They are the main barriers which can affect the whole
diversification strategy. UBER have to find new resources and new employees at the time of
expansion which will helpful to management in better diversification.
Budget constraints- It is the important element because without this, organisation can
not estimate its income and expenditure. At the time of expansion company requires new
technology and machinery so that, an estimation of budget is essential for moving activities in
new marketplace.
CONCLUSION
It can be concluded from the above report that the Uber is using swot and pestle analysis
for determining the impact of various external and internal factors which are effecting their
business. Using ansoff matrix, the suggestions are given to Uber for adopting suitable strategy
required for growth and sustainability in the market. Through the above discussed competitive
advantage analysis model, it can be concluded that Uber is achieving their desired growth and
success in the UK market and also the company has huge opportunities in the emerging market
like India and many more Asian countries.

REFERENCES
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