It seems its never quiet at Uber Towers. Their management team and employees have probably only just finished celebrating their successful appeal against TfL’s decision not to renew their operator licence. However, their next challenge awaits in the form of new app firm Zareou who could pose a significant threat with a very confrontational business model.
Having just convinced the High Court that they’re a fit and proper company the American firm must now tackle a challenge from a rival company that is determined to make inroads into their customer base. And they plan to do so by using potentially unscrupulous methods. Zareou are set to encourage drivers to promote their new app to Uber passengers whilst they complete a journey for the competing company.
How Zareo Works?
Zareo’s appears a ride hailing service like most others. Consumers simply open up the app and request a car. A driver arrives and takes them to their destination. However, it promises a “unique loyalty program for you to earn recurring residual income and points.” These rewards are for drivers and not just customers. You ae encouraged to “invite fellow drivers and passengers” in order to “build your network” and “earn a continuous residual income as they use Zareou.”
According to their website this system offers drivers the ability to earn whether they drive or not by bringing “affiliate marketing to ride sharing.” “Build your referral network and start your own virtual ride sharing business today” is Zareou’s marketing pitch. Put simply once the driver successful converts a passenger to the Zareou app they will be remunerated each time that user completes a journey.
How Will Uber Respond to Zareou?
Watching how Uber attempt to prevent this occurring will be interesting. Banning Uber drivers from using Zareo could be one option. However, over the past few years private hire drivers have become accustomed to driving for numerous app operators. Optimising their earnings by switching between job provider based on demand and the level of commission being charged is the accepted practice. Quite how Uber would enforce this rule would be difficult in practical terms. Also their firm are likely to want to avoid culling large numbers from their potential fleet.
The industry has become accustomed to new apps launching, promising something revolutionary, only to release more of the same. However this appears to be one of the most hostile and provocative business models to hit the market. Many would argue that Zareou are taking on Uber using their own uncompromising, approach. Whether Uber decides to fight fire with fire remains to be seen?
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