Chapter 13, Problem 2CCS

Summary Introduction

Case summary:

Country A peoples are always trying to travel without self-driving in order to avoid driving in rush roads and parking difficulties. Previously everyone will depend on the taxies whereas now the scenario has been changed into online cab services like U and L. Around 400 cities worldwide got the advantage of U and the benefits are also enjoyed by the riders, drivers, and communities. The U provides rides at a reasonable rate and also provides employment opportunities. The L expansion is not quite as extensive and is available in around 200 cities.

Both the services are through apps to connect the riders with the drivers. The company is following surge pricing and it will lead to an increase in the rate in busy periods and consumers get discouraged. Both U and L want to compete for head to head they are relying on various marketing strategies and also recruit new drivers in order to decrease the waiting time of riders. The U has a review or rating system in which the drivers are trying to increase their rating and if the riders have a low rate then the drivers may not respond to their pickup request.

The review system also has some negative aspects or consequences that on what basis they are reviewing and someone intentionally negatively review. U sends “ambassadors” to try to lure L drivers away to work for U. both U and L tries to grab drivers by providing new latest technologies and features for their phones to ensure they can find their riders. They also have some collaboration with car dealers to provide some concession while buying new cars for these purposes.

To discuss: The manner in which U and L rectify the service failure due fails in pick up a customer on time.