During its two years in Ottawa, Uber has established itself as a top-tier service with high satisfaction rates and a growing consumer base.
And now, on the verge of official legalization, the ride-sharing business is trying to improve its services even further.
This month, Uber launched upfront fares in Ottawa and Toronto, giving passengers an estimate of how much their trip will cost before they step into the car.
Under the app’s previous system, a pop-up screen would indicate whether “surge pricing” was in effect.
Surge pricing at busy times is usually 1.3 or 1.5 times the normal fare, but there have been instances on holidays when the price skyrocketed up to nine times higher than what it usually is.
Since many people naturally did not like the uncertainty and arithmetic that came with surge pricing, Uber did the smart thing and listened to the loyal customers who helped get the business legalized in the first place.
Uber is right to respond to their customers instead of continuing to force them to play surge pricing roulette. To continue their success they will need to keep listening not only to customers, but to city hall as well.
When council agreed to the dual-licensing system that allows companies like Uber to operate legally, they shot down Coun. Eli El-Chantiry’s motion to put security cameras in Uber cars. However, they did agree to revisit the idea after the new bylaw had been in effect for a year.
In a year’s time there is a good chance that Uber will have to make more compromises with the city.
The company has a spotty history on meeting local governments halfway, as they’ve threatened to leave Houston and Chicago after disagreeing on background checks and licensing.
So far, Ottawa city council has taken a relaxed approach to Uber, as they agreed to allow the controversial surge pricing because they say the app makes it clear that higher prices will be in effect during those times.
The city even recognized Uber as a separate entity, just as Uber representatives had requested. Uber pays the city 11 cents in commission for every ride in Ottawa for this separate licensing system.
Continued cooperation between Uber and the city is in the public’s best interest, as it offers a strong alternative to the taxi industry.
Competition should push both services to improve what they have to offer.
There is already evidence of this, as Ottawa taxis have partnered with the global taxi app eCab, presenting users with an interface similar to Uber’s and letting users pay with their credit card.
As taxis have learned from their competition, Uber must show they are willing to evolve and take cues from what works in the taxi industry while still giving clients the same quality of service they’ve come to expect.
While it may look like Uber can afford to do business solely on their own terms, this is simply not the case.
Uber has posted historic losses in the last quarter, with much of those losses coming from subsidy payments to drivers.
Uber is in a position to have long-term success in Ottawa, and whether or not they attain this success depends entirely upon their willingness to continue adapting to this market.