Why Uber is a Customer Experience Cautionary Tale
  • News & Trends

Why Uber is a Customer Experience Cautionary Tale

 

When news reports recently revealed Uber’s findings that customers were more likely to pay for surge pricing when their smartphones were nearly out of battery power, it caused instant controversy.

The information came from Uber's Head of Economic Research, Keith Chen. Though Chen immediately addressed that Uber does not abuse this information to maliciously impose surge pricing (increased rates implemented when demand exceeds the number of Uber drivers in the area) on customers in a bind, there was public outcry nonetheless.

Understanding the ethics of Big Data

Concerns were voiced regarding Uber’s ability to gauge customers’ battery life and whether this insight was an invasion of privacy. The innocent explanation for why Uber obtains this information? The Uber app is designed to engage in low power mode when the smartphone’s battery is dwindling to preserve energy, and no good deed goes unpunished.

In fact, Uber is a prime example of a business leveraging its customer data in an attempt to proactively better its customer service and improve customer satisfaction. According to Jeff Schneider, Engineering Lead at Uber Advanced Technologies Center, customer data is being examined in order to completely eliminate surge pricing. How? Uber is using this data to derive predictions about when and where user demand will suddenly skyrocket. Currently, surge pricing can be assumed inevitable after a sporting event or popular concert, for example. But taking a closer look at Uber customer data could reveal seemingly random peaks in demand and allow Uber to proactively dispatch drivers to the area. This would match supply to demand and avoid the need to incentivize drivers with an increased rate.

So why, when Uber is using legally and ethically collected information to better its customer service and lower prices, does the community immediately jump to a negative conclusion about its intentions?

General cynicism aside, the reason is simple: Uber is no stranger to PR blunders.

When reputation drives perception

Uber has had its share of unflattering new stories, including its poor response to an emergency situation, questionable CEO behavior, and an employee-led class-action lawsuit.

On one hand, it’s easy to dismiss a bad customer experience with Uber. Your driver is held accountable for his or her performance, you have the opportunity to rate said performance, and, if you award a less than five-star rating, Uber requests feedback so it can handle the situation appropriately. And, in general, Uber’s support has positive feedback from the public.

But that’s why Uber’s corporate PR blunders are to blame for its damaged brand reputation. It takes 12 positive experiences to make up for one unresolved bad experience. Customers witness Uber’s PR missteps without any direct interaction with the company, leaving no opportunity for Uber to resolve the situation directly with each customer. 

The result? As recently demonstrated, it’s a less than forgiving public reaction to even the best of intentions for its customers. Uber has an extraordinary business model that shook up a tired industry, but it’s also a customer experience cautionary tale. In the hyper-connected age of smartphones and social media, negative customer interactions have never been so critical to your brand reputation.

 

For a step-by-step guide to ensuring your customer experience turns your customers into positive word-of-mouth advocates, download Customer Experience for Dummies for free today.