The Uber model
Welcome to the Uber age
Industries such as home repair, cleaning, food delivery and Airbnb have taken a leaf out of the taxi-sharing service’s book
The new expression “uberisation” refers to a business model in the so-called sharing economy. It describes the use of a digital platform (often with an app) that is used to gain access to a service — usually through a network of small, independent providers, so that there is no centralised asset ownership (that’s the “sharing” part).
Uber uses an app to connect people who want a lift with independent taxi drivers, many of whom are owner-operators, driving their own cars to derive an income. The popularity of this model is due in part to the speed at which these businesses can build scale, because their owners don’t have to invest in their own infrastructure beyond the platform that holds the service together.
In SA, there are already at least 12 providers that have borrowed this model, either wholesale or in part, to leapfrog competitors and create jobs.
However, the model is not without its detractors — especially in terms of the perceived lack of security and sustainability of those much-needed jobs.
Having fundamentally disrupted the traditional taxi industry the world over, Uber has turned its attention to food delivery, and introduced UberEats to the market (first in Johannesburg, and later Cape Town).
This service connects restaurants with hungry patrons who want to get their takeaways delivered, even from places that do not have their own delivery services, and it uses independent drivers to do so.
The arrival of this service in Johannesburg prompted the dominant local player, Mr Delivery, to pull out the stops on an app-based variation of its existing service, called Mr D Food. Both were, however, pipped to the market locally by OrderIn.
The difference between it and the last-mentioned two is that the delivery fleet forms part of its
The app-based interaction is proving a winner, sparking the launch of even more offerings, such as Bottles — a local alcohol delivery service, promising to provide customers with their preferred tipple in 60 minutes.
It is already operating in certain suburbs of Johannesburg, Cape Town and Pretoria and even in Durban North, with more to follow.
Airbnb is probably the second-most famous example (after Uber) of this approach.
The company itself doesn’t own the properties it lets but connects landlord to tenant through its platform. The properties may be small fry individually in the tourism market of any city, but as a collective, this form of business is undercutting hotels and hotel chains the world over.
Another space that seems ripe for uberisation is home or domestic services, including connecting consumers to handymen, electricians, plumbers, cleaners
and so on.
The Domestly app took the top honour at the MTN Business App of the Year awards in 2016 for its service, which connects cleaners to consumers by means of both an app and a site. It has since branched out with a “Domestly for business” offering.
A similar service is SweepSouth. Initially it offered services only by means of a site, but it has since launched its app.
These apps offer a hi-tech solution to a unique SA industry — the casual domestic cleaner services space — including the facility of rating and paying providers through the platform.
Helpout and Gettod both connect consumers with independent locksmiths, plumbers and “handymen”, based on location and availability, so customers can get access to a vetted service provider simply and quickly.
Another local industry that faces uberisation — and which is arguably in urgent need of disruption — is the courier business. WumDrop is a delivery network that operates in cities (Cape Town, Stellenbosch, Pretoria, and Johannesburg) for relatively short-distance, same-day deliveries, and customers can track their parcel on its route.
Most services listed here have both Android and iOS apps, and transparent pricing. Some local competitors to Uber include Taxify, ZebraCabs, and even a group of Jo’burg-based metred taxi operators who have announced their intention to launch a competing app, and, it is hoped, taking their battle for customers from the streets to their phones.