Conducted a marketing campaign and launch strategy for Uber Eats in 10-26-2015

1. UberEats Pricing Strategy
in San Francisco
Jose E. Rodriguez

2. UberEats delivers the best of your city right when you want it. Our
curated menus feature dishes from the local spots you love. And the
ones you’ve always wanted to try. It’s same cashless payment as an
Uber ride. So just tap the app, meet your driver outside, and enjoy

3. What is the goal?
Goal
Access competitors pricing model & determine
selling price to maximize market share
Start with Penetration Model
Tasks
Research target market’s frequency and
wiliness to order delivery at different prices &
determine break even points.
Tools Internet Research, Excel, Tableau

4. Research Method
1st Hand Research
•Survey Monkey
•Industry Inside Friends
2nd Hand Research
•San Francisco Census
•Statista.com
•Tech Crunch
•Sprig
•SpoonRocket
•Farm Hill

5. Solution Process
Penetration --> Cost +
Customer
Needs
Customer
Demographics
Break Even
Customer Benefits
Offering:
Penetration
Expertise
Cost +
Market Price
Lunch: $12.5
Dinner: 14.5
Competitive influences
Enter with a price
of $8 for lunch,
which is 48.8%
lower than
current delivery
Brake even in 1 yr
Dominate
presence in San
Francisco with
16, 000 active
users with 100K
UBER app down
loads
UBER menu is
extensive

6. CanUber Eats enter the Food
Delivery Market at a delivery price
comparable to its competitors to
obtain favorable market share in
order to later introduce a slight
higher price to gain more profit
Market
Share
• 5% Of Market
Share
Price Point
Average –
• $ 20% under
competition
Break Even
• Break even in
year one
Problem Statement
Criteria of success?

7. Industry growth: .35%/month
Market Analysis
Growth
Direct
Competitor
Growth:
30%/mo

8. Market Analysis-
Market Comparison

9. Market Analysis
Range price
Sprig
Spoon-
Rocket Eat24 Cavier UberEats
Breakfast N/A $8.95 $14.50 $14.25 $13.24
Lunch $13.5 $13.25 $17.25 $15.50 $14.50
Dinner $14.5 $13.75 $19.00 $17.25 $16.25

10. Target Segment
San Francisco Market
Age:
18-65
Working
professionals
& families
Current 35%
using delivery
service apps
Lunch
&
Dinner

11. Survey Results:
How often do you order?
2%
8%
24%
26%
16%
11%
10%
2%
0% 5% 10% 15% 20% 25% 30%
Daily
4-6 times per week
2-3 times per week
One a week
Every Other week
Once a month
Less than once a month
Never
Share of respondant ©statista 2015

12. Survey Results:
How often would you order?
Lunch Price Orders per week
$6.00 4.36
$7.00 4.36
$8.00 4.21
$9.00 4.21
$10.00 3.29
$11.00 3.07
$12.00 2.71
$13.00 2.43
$14.00 2.00
$15.00 1.50
$16.00 1.43
Dinner Price Orders per week
$8.00 4.93
$9.00 4.79
$10.00 4.57
$11.00 3.86
$12.00 3.64
$13.00 3.14
$14.00 2.50
$15.00 1.79
$16.00 1.29
$17.00 0.93
$18.00 0.36

13. Top Down & Bottom Up
SF Market
•Population 18-65
•617,188
Segment:
Age
•Meals ordered/day
•362,597
Market Size
•Average Meal $14
•$1.85B
•Average meal
$15.47
•$1.21B
•Meals ordered/day
•358,628
•Total Population
•797,976
Zip Code
Zone:
1+2+3
Zone
Segment:
Market
Size
Average:
$1.52B
Just
Delivery:
$148M

14. Market Size: by ZonesZone1Zone2Zone3
Delivery %NeighborhoodPopulation

15. Penetration Price Point Model Z1
• 52.1 % demand food delivery
• Price Launch
• Lunch $8
• Dinner $10.45
Comprised of
• North beach, financial district,
Nob Hill, Russian Hill,
Mission, Van Ness, Soma
• Zone population of ~ 300K
ZONE 1

16. Penetration Price Point Model Z2
• 29.6 % demand food delivery
• Price Launch
• Lunch $8.43
• Dinner $13.10
Comprised of
• Marina, Persidio, Richmond,
Sunset, Sea Cliff
• Zone population of ~ 306K
Zone 2

17. Penetration Price Point Model z3
ZONE 3
Comprised of
• Glen Park, MiraLoma Park, Pacific
Heights, Lake shore, Stone Town
• Zone population ~200K
•
• 18.3 % Demand Food Delivery
• Price Launch
• Lunch $9
• Dinner $14.47

18. Pricing Model Demo
©statista 2015
• Fixed cost
Based on Delivery Franchise Model with UberEats driver paid as employees
not as individual contractors
• Variable costs
Based on UberEats and competitors pricing. Inside knowledge of Food
pricing and food costs
• Selling Price
Based on competition pricing & maximizing market share (orders per week)

19. Recommended for Lunch Price

20. Recommended for Dinner Price

21. Insights
Keeping delivery
constraints in
mind
Different
cost/prices for
different zones
Different pricing
model for launch
and long term

22. Recommended Price Based on
Models
2. Price Recommendation:
• Zone 1: Lunch $ 8.00; Dinner $10.45
• Zone 2: Lunch $ 8.43; Dinner $ 13.10
• Zone 3: Lunch $ 9; Dinner $14.47
4. Value to Customer:
• Lunch $ 8-$9 > $ 11.84
• Dinner $ 110-14 > $ 14.50
1. Competitive Landscape:
• Lunch: $12.5
• Dinner: 14.5
3. Survey Data: $6-$16 (Mean $11)

23. Recommended Price Based on Models
We recommend having food delivery as low as $8 and as high as $14.47
1. Price low to capture maximum market share
2. Higher engagement of the San Francisco food
delivery Market
3. Driver increase to execute larger delivery loads
4. Put food delivery into the hands of San Francisco
residents

24. Who wants to order UberEats?

25. ©statista 2015
Appendix

26. Zone Break Even: Lunch & Dinner
$-
$100,000.00
$200,000.00
$300,000.00
$400,000.00
$500,000.00
$600,000.00
$700,000.00
0 2 4 6 8 10 12 14 16
Increase Dinner Price at this time
Months
Zone 2
• Current Dinner $13.10
• Dinner Break-even 4
Months
Suggested time to introduce Cost/Mark up Price Model

27. Our pricing model:
Lunch & Dinner
$-
$100,000.00
$200,000.00
$300,000.00
$400,000.00
$500,000.00
$600,000.00
$700,000.00
0 2 4 6 8 10 12 14 16
Increase Lunch Price at this time
Increase Dinner Price at this time
Zone 3
• Lunch Break-even in 8.5
Months
• Dinner Break-even 2.5
Months
Suggested time to introduce Cost/Mark up Price Model
Months

28. Solution Process
Penetration
Acknowledge Operations
requirements
Penetration
Intraprocess Automation
&
control
Cost +
Valuation control
&
Business Structure
Break into Food Delivery market of
1.52 billions meals per year- Many
mouths to feed!
Optimize existing UBER
drivers to mitigate new
drivers and lag time
Aggregate restaurants in each
zone to finalize routes for price
efficient routes
Set food delivery price as
penetration method
Specify upcoming price difference
in each zone at different times
Zone 1, 2, 3
Increase UBER EATS drivers in
each target zone from 7 drivers to
10
Obtain the San Francisco food
Delivery Market with existing
penetration price.
Launch Marked/Cost Plus Pricing
to increase profits after break –
even is successfully executed

29. Excel Model