Took my first ride on Uber - Everyone's Private Driver - last week and have to say, what a good experience. Easy to book, easy to enjoy – swank limousine, water, wet towels at your disposal – and a well-trained, well-spoken driver who drives well, and knows his way around.
The US-based start-up that’s used the convergence of data and mobile to disrupt ground transportation around the world is now in Singapore, and looking to expand across the region.
Says Sam Gellman, who’s driving the expansion and who set up London and Amsterdam before coming out East, “There is not a major city in Asia that we’re not looking at.”
The reception to Uber in Singapore has been nothing short of “unbelievable”, says Gellman. “We’ve never had a city that so many sign-ups in such a short time and more completed trips. There is more demand than we expected and the hardest thing is getting cars – all good problems to have.”
The Uber app had more than 1,000 sign-ups in the first week of launch and Gellman says interest shows no signs of tapering off in a city where the novelty effect is particularly strong – something new comes along, everyone flocks to it and then moves on to something new just as quickly in this town.
Uber’s sourced supply by working with locally-registered limousine companies that have passenger insurance. Most of these companies work for hotels or corporations and they usually do airport transfers or road shows for celebrities and VIPs.
“They spend 30-40% of their time in the garage,” says Gellman (right). “We tell them, turn on the Uber app and we’ll find the customers for you.”
The driver, who took me home and who’s just started driving for Uber, tells me he gets an average of 6-7 bookings a day. He works for a limousine company which gives Uber a 20% commission for bookings.
The fare, from Mohamed Sultan to my place in Tanjong Rhu, came up to S$31, about three times the normal cab fare. I reckon there are plenty of people willing to pay that – it’s getting harder to get taxis in Singapore during peak times and particularly when it’s raining.
Tommy, my driver, tells me his customers are mainly local expatriates.
Gellman says on average 90% of Uber’s customers are local residents versus tourists. “We have been surprised by how quickly we get local customers. It’s inevitable we serve travellers as well – we are in 29 cities – but our growth is based on local markets.”
In terms of generating demand, it’s user begets user. Uber doesn’t advertise, relying purely on word of mouth.
So what makes an Uber-friendly city? Gellman says, “A population that likes options – in Singapore, you can eat hawker food or dine in fancy restaurant. Singapore is the type of place where people like to try new things, it’s technology-friendly and innovative and is business-friendly.”
Some cars have wifi and Uber’s looking to have wifi across its fleet.
Uber’s arrival is a boost for the limousine industry in Singapore. It generates new income streams for limousine companies. For individual drivers who own/lease their own vehicles, it gives them access to a wider customer base. And for the industry in general, it raises competition and thus should increase service levels. One downside for private drivers is because they are tracked all the time, they can't take time out to drive their families around.
It is estimated there are 20-25 limousine companies in Singapore and Uber is reported to be working with 5-8 currently.
“We’re not doing anything that’s new really – the ability to book limousines has been there for the last five years – what we’ve done is made it mobile and made ground transportation exciting by creating great customer experiences,” says Gellman.
The high mobile penetration in cities in Asia should play to Uber’s advantage. “Maybe that’s why we have such a good pick-up in Singapore, we live and breathe data and mobile.”
The challenge, as with bringing in a new brand to market, is local execution. “Anytime you start a new consumer product and you don’t advertise, you need to fire on all cylinders. You have to get the product as local as possible, hire a local team (it’s got three people now in its Singapore team) and infuse in them our culture, energy and excitement.
“By far the best thing is job creation for drivers and the amount of money we give them every week and watching this whole community get a new income stream.”
Comparing Singapore with Amsterdam, he said, “In Amsterdam, they ride bikes so there is less demand and it was harder to get people excited about it. But I don’t know anyone who doesn’t like to be treated like a king – everyone loves great service.”
Gellman's off to Seoul this week and Tokyo is next on the radar.