When Uber was invented in March 2009, daily taxi-cab customers that were already in the habit of using transportation services used Uber as well. Uber was launched in San Fransisco that already had a powerful and successful taxi transportation service. Uber has not originated from a low end of the market and did not target nonconsumers. Uber has gone exactly in the opposite direction: building a position in the mainstream market first and subsequently appealing to historically overlooked segments.” They said, “Disrupters start by appealing to low-end or unserved customers and then migrate to the mainstream market.

Uber has been determined as cheaper than taxis, but it’s not considered “inferior” to cab or taxi servicesĬhristensen and co-authors Michael Raynor and Rory McDonald wrote a 2015 article for the Harvard Business Review and explained how Uber is the complete opposite of a disruptive innovation.

Uber has not moved up from the low end of the market – the company targets customers that have already been cab users multiple times.

According to the site, Uber is not a disruptive innovation and the reasons are as follows: Young adolescents and college students are using Uber to get to places faster, and ultimately, save more money.Īn article posted on World Economic Forum caught my eye.

More and more people are paying for Ubers through the simple and efficient app rather than paying for a more expensive taxi.

My partner and I believed that Uber was a disruptive innovation because it has had great impacts on the taxi-cab industry.

While in class on Tuesday, our professor asked us to give examples of disruptive innovation. According to the World Economic Forum, a disruptive innovation is a theory that “a smaller company with fewer resources can unseat an established, successful business by targeting segments of the market that have been neglected by the incumbent, typically because it is focusing more on profitable areas.” However, there has been controversial discussion over whether Uber is actually a disruptive innovation or technology that is improving our overall economy.

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