Where has Uber been most successful? Least Successful? Why?

Uber emerged most successful in Bogota, Colombia. Though it claims to have made a quite
landing, it users grew four times faster in first year in comparison to San Francisco’s launch.
The main reason behind this is Colombia never had e-hailing culture or rideshare companies.
The incumbent taxi industry was extremely unreliable and unsafe and also lacked proper
regulatory framework. Traditional taxi drivers tamper with meters and are known to take
unnecessarily long routes to increase fare. In addition to this there were serious safety
concerns. There was an instance where an armed taxi driver held wealthy drivers at gun point
and threatened to withdraw large amount of money from ATM. Uber on the other hand
proved to provide better quality and safer rides. The rides were easier to locate. Uber
carefully investigated potential drivers legal records before engaging them. For these reasons,
Bogota people Uber even though they are costlier than the traditional taxis. It received
backlash from taxi drivers for being exempted from the regulations which resulted in
temporary ban in the region. It later reclaimed its operation by agreeing to work with the
Colombian Law. Uber emerged successful in Colombia and other Latin American countries
because of lack of quality transportation alternatives.

Uber was least successful in China. China already had two native firms Didi Dache and
Kuaidi Dache using similar model as Uber. Didi had around 80% of the market share in 2012.
In addition to this, it faced numerous other obstacles. Uber primarily relied on Google Maps
which was not available in China. Customers are required to validate their credit cards but
Chinese consumers use WeChat and AliPay which were affiliated to conglomerates that is
associated with Didi and Kuaidi. When Uber was trying to establish its territory, Didi
invested in Lyft, Uber’s main US competitor. It also spent a lot on driver subsidies and ride
discounts. Uber also provided subsidies to its drivers and offered free rides for new
customers. After intense competition, Didi acquired Uber in 2016 and Uber took 18% stake
in Delhi. Though Uber invested a lot in subsidies and infrastructure, its market share was
never more than 30%.

Uber also faced a hard time in South Korea. Its operations were hampered by laws limiting
the use of non-commercial vehicle for commercial purposes, opposition from taxi drivers and
regulatory authorities and cap on taxi supply.
Why might some markets have more potential profit for Uber than others? What
factors determine how a firm can or cannot unlock from each market?

Uber emerged successful in markets like New York and Bogota because both these markets
lacked ride share companies or e-hailing services. This paved way for their unrestricted
growth. Though there were oppositions from both traditional taxi drivers and transportation
authorities, Uber eventually emerged a winner in the race. It provided subsidies to drivers and
offered discounts to customers to lobby them to their side. Majority of New Yorkers owned a
smartphone which made Uber’s growth easier. In Bogota, Lack of alternative rides fuelled
Uber’s growth. Uber provided safe and comfortable riding which traditional taxi service in
Bogota did not ensure of. New York also had enough resources (for hire vehicles) which
Uber could take advantage of.

It incurred a loss in China since it did not do a proper background study. China already had
two dominant well-funded e-hailing services with majority of the market share. Uber was
also not aware of the payment options and their feasibility with Uber operations. Because of
this, Uber was acquired by the country’s dominant and largest player. It incurred loses even
after investing a lot on discount, subsidies and infrastructure.

An organisation should understand the existing marketplace and cultural landscape before
venturing into the business. It is also important to understand the regulatory frameworks and
policies of the associated marketplace to prevent any backlash in future. Availability of
resources is another important deciding factor for establishing business in a market place.