SWOT analysis of Ola cabs

vs
SWOT ANALYSIS OF UBER

SUBMITTED TO SUBMITTED BY
AMAN DHEER MAM GHAN SHYAM CHOUDHARY
21035
INTRODUCTION

• Ola cabs are India based

taxi-service Provider
Company. Ola was
founded in the year 2010
by the company called ANI
Technologies Private
Limited.
Strengths in the SWOT analysis of Ola cabs :
This helps in understanding the core areas of the business where it beats the competition and has the
competitive advantage in the market. Strengths are generally the core competency of the business.

• First Mover Advantage – Ola started back in 2010 and had the first mover
advantage in comparison to its competitors which started very late in the segment.

• Product Line – Ola offers a wide product line which starts from offering services using
bikes, auto, and different types of cars.

• Technology – Ola makes use of state of the art technology with strong data analytics which
helps it to forecast the demand in any geographic region accurately so as to provide the balanced
supply of cars for the commuters.

• Strong Brand Name – Ola has been able to establish high brand recall and brand
name in the market as there are only a few players in the cheap rides segment.
CONT.
• Low Investment – Ola being an aggregator service provider does not have to possess
the fleet of cars to run their business. Drivers from the region collaborate with the Ola to meet the
demand from the customers and hence there is always a cash surplus.

• Dynamic Pricing – Ola has been using dynamic pricing model to rate the ride according
to the demand of the rides in a particular region or during the bad weather conditions. This helps to
manage the supply in an efficient manner and at the same time adds to the bottom line.
Weakness in the SWOT analysis of Ola cabs :

This is the pain area of the organization where it does not have the resources or skills. Business has to
work upon these areas so that they are not left behind from the competition. Though there will be some or
the other weakness it should not be an area which takes the business out of the market.

• No Control over Drivers – The business model that Ola is executing leaves itself
with no control over the drivers. Drivers play important role in making the brand name of Ola and hence
any misbehavior of the driver with the customers directly sabotages the image of the brand in the
market.

• Fake Rides – Ola drivers have started to ask riders to book fake rides just to increase their
ride counts for the day and Ola has no control and visibility over this. This leads to a loss of revenue as
the drivers are getting paid for nothing.

• Weak Support – The support services offered by the taxi service is not up to the mark and
customers are always grunted over the support they receive from the brand. This has tarnished the
brand name in the market.
CONT.
• Dependence on Internet – Customers can only book rides if they are connected to
the internet. As in India, the connectivity is an issue and hence customers are not able to book rides.
Though they have started with the offline booking it is not yet very helpful and appropriate.

• Market Segment – Though they market themselves as mass segment usage people who
are tech savvy are able to use the services. In India, the ratio of tech-savvy people is very less in
comparison to the non-technology users.
Opportunities in the SWOT analysis of Ola cabs :
This helps in understanding what other things a business can do with the current skills and resources. It
helps the business to know the areas where it can expand and take a lead in order to diversify the
business and expand the customer base

• Wider Market – In order to attract non-tech savvy customers, Ola has to rethink of their
business model where such segment can also make use of their services and it will be a big
breakthrough as it helps to enhance the customer base to a great extent.

• Increasing Internet Penetration – With the increase in the initiatives taken by

the government to make Smart cities and penetrate the internet to remote places as well provides Ola
with an opportunity to focus on these regions and expand their services to Tier 2 and 3 cities as well.

• Poor Government Transport – In Tier 2 and 3 cities there is a lack of proper

government transport facilities and hence this opens door for Ola to look into those cities and capitalize
on the opportunity
Threats in the SWOT analysis of Ola cabs :

This analysis helps in understanding what are the areas which can impact the business in future or right
away. So business has to prepare itself to handle the threats in the market landscape. Competition or
increasing number of players in the market with same value proposition is a threat to business as it directly
lowers the customer base and revenue.

• Government Regulations – Government regulations about the taxi service industry

is unclear at the moment. Taxi providers are constantly being threatened by the changing rules and
regulations.

• Customer Satisfaction – With bad customer service and presence of Uber in the
market makes the customers switch the brands.

• Competition – There is an increasing competition in the market due to the presence of Uber
and other emerging players in the local regions.
INTRODUCTION
One of the most acclaimed startups, which showed
the power of the internet and has a really inorganic
growth is Uber. Uber is an app and is known as the
company which has the largest fleet of automobiles
and yet, it does not own a single car by itself.

Uber is a ride sharing app and it replaces peope

having to step out of their homes to hail a cab. Now
the cab comes to your doorstep. This, and the fact
that Uber has a fantastic and low pricing policy for
its users, makes Uber a favorite app for the
frequent or even random travellers. Many office
going crowd are now regularly picking an Uber cab
instead of driving to the office themselves.
Strengths in the SWOT Analysis of Uber :
• Brand Equity: Uber is a recognised Brand Globally with presence in over 50 countries. Uber
has already surpassed Automobile giants like General Motors, Ford and Honda on Brand value
Parameter.

• Low Fixed Investment: Uber, being an aggregator does not require high fixed
investment and so it becomes easier for Uber to add more cities to its network.

• Emphasis on Customer Satisfaction: Uber has always prioritised customer

satisfaction. Uber has understood that it is serving in a totally customer driven market where
competition is increasing.

• Dynamic Pricing strategy: Uber has adopted the dynamic pricing strategy which
works on the demand supply principle of economics.
CONT.
• Adaptive: Uber is also known to adapt very well to business conditions. Because of its
international exposure, Uber faces various problems in various regions.

• Growth rate: The growth rate of Uber can be seen below. This concerns growth rate in India
only. As we can see, Ola is expanding by more then 100% year on year and this expansion has
continued in 2017
WEAKNESSES in the SWOT Analysis of Uber :
• Highly Dependent on Manpower: Drivers are the face of the company and
thus the company’s image depends on the behaviour of drivers towards the customer.

• Highly dependent on Internet: Uber is heavily dependent on internet connectivity

to expand and develop itself in developed countries.

• Caters only to Tech Savvy individuals: Digital Literacy in developing

nations is low and hence technology based applications such as Uber only cater to those who are
technologically updated.

• Controversies: We had written an article on business lessons from Uber rape case. Uber
has encountered controversies in the past mainly because of the drivers and their behavior.

• Low barriers to entry: Uber is in an industry where the barriers to entry are very low so
it will face competition in multiple fronts.
OPPORTUNITIES in the SWOT Analysis of Uber :
• Dissatisfaction with unorganized market: Customers are unsatisfied
with the unorganised cab market which presents an opportunity for Uber to take advantage of.

• Increasing internet penetration: With Government’s move to digitise India,

Number of smartphones are increasing and technology based applications like Uber can expand their
services to other cities and enlarge its footprint over the country.

• Rising Disposable income: With rising disposable income, customers are willing to
spend higher on convenience.

• Alternate transport: Uber has launched ‘Uber chopper’ in various countries and can look
for other transport medium catering local needs. In India, Uber can launch Bus aggregator system.
CONT.
• Poor government transport: In markets like China and India where there is over
population and people are tired of using public transport, Uber provides a kind of privacy and relief
where the user gets his own space to travel and does not have to drive in Traffic.

• Special transport: Uber can provide special transport services such as paid ambulances
or urgent and emergency vehicles for dedicated transport operations.

• Logistics: A smart idea for Uber can be to launch movers and packers support whereby people
can search movers and packers in the nearby area via Uber. Local logistics can also be integrated.
Though this is easier said then done.
THREATS in the SWOT Analysis of Uber :
• Government regulations are unclear: The primary point of disagreement
between cab aggregators and government regulators is about their legal status and whether they
should be treated as conventional taxi companies or as IT companies.

• Customer retention and brand switching: As competition rises, it

becomes all the more difficult to retain customers and drivers for Uber.

• Low margins: Uber helps the drivers to get a high number of daily rides but it does not have
a high-profit margin for the drivers and thus they can easily be swayed away.

• Revolt from unorganized market: The unorganized market of cab drivers can
revolt against such companies which are taking away the bread and butter of drivers from unorganized
market.