When Dara Khosrowshahi was ushered in as the new broom at Uber in August, he can’t have realised the full extent of the mess he had been tasked with clearing up.
Damaging claims of sexual harassment that came to light in February were superseded in September by the dramatic decision to strip Uber of its London licence, and then in November it was on the losing end of what’s being hailed (excuse the pun) as a landmark Employment Appeal Tribunal.
Things took a distinct turn for the worse this week when Bloomberg revealed details of a customer data breach in October 2016 and subsequent cover up that saw the company shell out $100,000 to the perpetrators on promise of destroying the evidence.
With a market capitalisation estimated to be north of £50bn, Uber is a company with deep pockets, but the global nature of the breach – which affected 57m users and drivers – means it is subject to investigations by authorities in the United States, United Kingdom, Australia, and the Philippines, and any fines could therefore be significant.
Beyond any potential pain inflicted on the company’s balance sheet, this is another damaging blow to Uber’s already beleaguered brand at a time when Khosrowshahi and chief brand officer Bozoma Saint John are focused on the emergence of a ‘New Uber’ from the tarnished chrysalis of the company’s not-too-distant past.
Old Uber, however, is learning the hard way that a disruptive model, a great user experience and a nice logo are not enough when times get tough. In the blinkered quest for market dominance, its brand, its purpose and its company culture - the essential elements that serve to underpin everything a business does – were neglected or even ignored.
As the late branding guru Wally Olins said, the concept of brand is quite simple: it’s the central guiding idea of a business that “persuades outsiders to buy and insiders to believe”. Without it, or without articulating it properly, companies can find there is a price to pay - both figuratively and literally in Uber’s case – as consumers are less inclined to invest emotionally and come on the journey as brands diversify and seek out new growth.
Uber’s attempt to extend its reach into personal finance through the launch of a branded credit card in partnership with Barclays is a case in point. With question marks hanging over its ability to safeguard personal data, it is likely to face an uphill struggle to convince consumers it can be trusted with their money. All the while, it is losing market share to Lyft, which is perceived as a more ethical and trustworthy competitor.
Other tech disruptors who have experienced rapid growth are also facing up to challenges – albeit of a very different nature – as their brands evolve. Saffron’s recent work with YouTube, for example, forms part of that brand’s evolution in the eyes of consumers, enabling it to go beyond free cat videos and into the realms of paid-for premium content.
It’s unclear how successful these strategies will be but as we head into 2018, it is clear from a brand perspective that the upstarts of tech are starting to realise it’s time to grow up.