Uber Expands Its Same-Day Delivery Service: ‘It’s No Longer an Experiment’

Harry here.  In my view, 2015 has been the year of delivery.  Whether it’s food, packages or groceries, it seems like the delivery market is really heating up and could even eventually overtake the rideshare market.  

I actually toured DoorDash OC this week and will be posting about it next week.  But today, RSG contributor John Ince takes a look at Uber Rush and a few other top stories from the week, a lot of them having to do with Uber.  Enjoy.

Uber Expands Its Same-Day Delivery Service- ‘It’s No Longer an Experiment’

Uber Expands Its Same-Day Delivery Service: ‘It’s No Longer an Experiment’

Sum and Substance: Local delivery is one of the most crowded spaces in tech right now, and ride-hailing giant Uber wants a piece of it. At long last, the company is introducing a fleshed-out same-day delivery program for brick-and-mortar businesses under the name “UberRush.” Uber has already started testing this in New York City and is now expanding the pilot to San Francisco and Chicago. The price of delivery will range from $5 to $7. “It’s no longer an experiment … It’s a business for us,” said Jason Droege, who runs UberEverything, the part of the company that tests new initiatives outside of the ride-hailing business. “When it’s a business, you’re worried about the profit and loss.” Participating businesses can either sign up for the program directly with Uber or access the service through e-commerce software tools such as Shopify and Bigcommerce, as Re/code previously reported. Other launch partners include Delivery.com, food service ChowNow, florist service BloomNet and digital cash register service Clover. Uber said it is targeting smaller, local retailers and restaurants with this offering, not bigger brands like Target or Nordstrom. Uber has had a hard time signing up big-name retailers for delivery partnerships, according to sources.

My Take: Local delivery is indeed a crowded space.  With its infrastructure and capital resources, Uber will certainly be a player.  But they’re up against big boys and experts in the field who have decades to hone their skills and apps.  I’m told local delivery is a bear, technologically.  I’m still wondering how many Uber drivers will eventually pick up on the delivery option?  What about you?

Even Uber drivers are now protesting against Uber in France

Sum and Substance: Uber chauffeurs stage protest outside Paris headquarters over recent reduction in fares. A group of Uber drivers staged a protest outside the company’s Paris office Friday morning over a recent reduction in rates across the French capital. As the French newspaper L’Express reports, the group of about 50 chauffeurs were demonstrating against a 20 percent fare reduction for the company’s UberX service and a 25 percent cut for UberPool, which went into effect today. The protesters were eventually dispersed by police in riot gear. Uber introduced the rate cut in response to recent promotional campaigns from French taxi companies, which have offered lower fares for young passengers and late night trips. The San Francisco-based company said it would compensate drivers for the difference over the next six weeks, writing in a blog post that the increased volume of passengers would ultimately boost their revenue. The post also noted that drivers in New York saw their hourly turnover increase by 50 percent following a similar fare reduction, but the drivers protesting this morning apparently aren’t convinced.

My Take:  Uber’s rate cuts are a sensitive issue with drivers everywhere, but it appears they really got into it in Paris.  Imagine police in riot gear in your city, dispersing Uber drivers.  The whole rate fare cut thing suggests to me that Uber just might be taking an infinite pool of capital investment for granted.  According to Bloomberg, Uber lost $400 million over some indefinite period.  That suggests they’re losing a dollar for every dollar of revenue, which isn’t really a good business model. Essentially what they’re doing is funneling money directly from investors to passengers.  Great if you’re a passenger, but not great if you’re an investor looking for an eventual return or a driver who essentially just got a pay cut.

This guy turned his Tesla into an Uber, but it didn’t go well

Sum and Substance: “What amazes me is most of the people said, ’Wow, it’s a Tesla, first time I’ve rode in a Tesla’,” he said. So far, Zhang said he’s completed 102 trips and made $1,022.59, before Uber took its cut and without accounting for his own expenses. After the Uber fee — which can range from 20% to 28% depending on the city and when the driver signed up — Zhang calculates that he has collected 76 cents per mile. This is cut down to 70 cents when factoring in his Tesla’s cost of six cents per mile to drive. This may not be enough of a profit to keep driving for the service, Zhang said, and he’s pausing his driving while deciding whether to keep going. “I cannot spend money and my time [when] I’m not making a return,” Zhang said.

My Take: Crazy idea to drive a Tesla for Uber.  They say a new car loses almost 20% of its value the moment you leave the dealership.  Depreciation on a new Tesla is how much – $15,000 minimum?  This guy isn’t even making that much in an entire year as an Uber driver.

Uber CEO’s softer side

Sum and Substance: Tavis Kalanick, who’s usually described as the outspoken and hard-driving CEO of ride-hailing app Uber, showed his softer side in a talk to business students at the University of California-Los Angeles. Kalanick, who formed Uber with Garrett Camp during a trip to Paris and went on to transform the transportation industry, talked about the all-encompassing 24/7 ways of starting a tech business. “The entrepreneur’s way is to push until it hurts. because if you don’t, something else will pass it by,” he said. His company has made a huge impact: Uber is currently in 350 cities around the globe. It’s nearest competitor, Lyft, is in just over 60 in the U.S. But Kalanick told students that after working endless hours to get Uber off the ground, he realized he could only keep up that lifestyle for so long. “You have to find ways to be balanced and centered,” Kalanick said.

My Take:  TK it seems to be basking in the limelight.  An appearance on the Late Show with Stephan Colbert, a major feature story on him in Fast Company and invitations to speak at Dreamforce and on college campuses.  The remaking of Travis Kalanick’s public persona is well underway.  But Kalanick’s softer side?  Oh my.

Inside Uber’s Mission to Give Its Drivers the Ultimate App

Sum and Substance: Uber’s founders didn’t invent Uber for drivers. They invented it for themselves, a couple of guys in San Francisco who wanted to be ballers by summoning limos from their phones. Then they invented it for ballers like themselves—upscale urbanites, mostly. Then they invented it for anyone who wanted to get anywhere by “pool” or “x” or “SUV” or “helicopter,” even if they didn’t care about being a baller. Push a button, get a car. On the other end of that button, there have always been drivers, picking up rides from an app that has looked and functioned pretty much the same since the company launched.  For drivers, the Uber app was decidedly un-baller. That changes today, as the company rolls out its first redesigned app for its partners. It’s the culmination of a massive, yearlong design process to which nearly 100 Uber employees contributed. The new app will transform Uber’s driver software into a management platform offering tools to help its drivers tend and grow their businesses. “We’ve had this fragmented communication with drivers over email and we just didn’t have information available for them,” says Jeff Holden, the longtime Amazon executive who joined Uber last year as head of product. “We wanted to completely re-invent the driver app.”

My Take:  If true, this is a long awaited and welcome development.  But don’t get your hopes up – tipping option isn’t included and probably never will be.

Last Night, My Uber Driver Said He Was Going To Rape And Kill Me

Sum and Substance: Last night, … I used Uber’s app to hail an UberPool, and manually input the pickup address as 400 Duboce. About four minutes later, my phone rings. It’s my driver, who leads with “I am here, where are you?” “I’m at 400 Duboce,” I say. “No you’re not, I am at 400 Duboce Avenue and you are not there. Where the fuck are you? What kind of person isn’t there when they call an Uber?” “I’m right here, where I said I was,” I said. “But I’m not comfortable with this,” I said, because if a guy is aggro enough to start swearing at me off the bat I’ll be damned if I’m getting in a car with him. “I’m going to cancel my ride, thank you.” I hung up, and hit “cancel ride” on the Uber app. As I’m doing that, my phone rings again. At the same time I look to my left, and I see a black sedan start to drive up the ramp to the raised Muni platform. I answer the phone. “How about I stick my dick in your pussy?” the driver screams. “I see you there, look at me, I see you there on your phone.”

My Take: Sounds like the driver lost it on this one – and had the misfortune to be losing it while talking to someone who works in the media.  Not a good situation.  Look’s like he’s history – and rightly so.  Meanwhile, Uber brandishes it’s public image as “taking matters like this very seriously.”  Where have we heard that one before?

What did you guys think about the week’s top stories?   What do you think of TK’s softer side and Uber’s foray into delivery services?

-John @ RSG