How Uber is waging war by winning hearts and minds (Kate Upton edition)

The real magic behind Uber isn't its disruptive technology. It's the company's ability to identify an overregulated industry with outdated regulations.

From knowing its local markets to exploiting toothless municipal regulations, Uber plays to its advantages

Brett Wilson was tapped to be the first passenger for UberX in Calgary, though the city has since filed an injunction to temporarily shut the service down. (Evelyne Asseline/CBC)

This is part two of a three-part series. Read parts one and three.

What do Kate Upton, Brett Wilson and a unicycle-riding musician playing fire-breathing bagpipes behind a Darth Vader mask have in common?

They've all been enlisted by Uber in its ongoing fight to win hearts and minds in cities around the world. But Uber's approach to gaining traction in new markets doesn't stop at a supermodel, a former dragon or the Unipiper.

A look at how Uber gets what it wants reveals a company whose true expertise lies in identifying cracks in the current system and then prying open those fissures until they're big enough to drive an app down the middle.

Uber's origin story dates back to a winter night in Paris in 2008, when founders Travis Kalanick and Garrett Camp were stranded without a cab. Oh! To be able to get a ride at the press of a button, they mused. And with that, Uber was conceived.

The actual unfolding of events isn't quite so pat. But then again, neither is Uber.

Striking upon a better way to summon a ride is only part of why Uber is now a household name. The real magic behind its success comes from identifying an overregulated industry ripe for the picking that's housed within cities ill-equipped to handle the pressure the company has learned to apply.

Lobbying juggernaut

Now in more than 350 cities, with others coming soon, Uber finds itself carrying on different parts of the same conversation — whether a city is just being introduced to the ride-hailing service, midway through its roll-out, or it's clearly up and running.

When possible, Uber still enjoys playing the role of wide-eyed corporate naïf that's just trying to connect passengers with drivers. It's a cute message that's belied by the sophistication of the company's lobbying and public relations machine, as well as the surgical precision within which it operates.
David Plouffe, public policy adviser for Uber, speaks at the Vancouver Board of Trade. Plouffe is a well-established strategist who previously worked as the campaign manager behind Barack Obama's successful bid for the White House. (CBC News)

Exhibit A is Uber's public policy strategist David Plouffe, who previously worked as Barack Obama's campaign manager and then as a White House staffer counted among the president's most trusted advisors.

Now Uber is using Plouffe, who's literally in the strategists' hall of fame, to help win political battles around the world.

The evidence in Canada to date shows it's not an even fight.

The cities in Uber's crosshairs aren't accustomed to handling the type of policy challenges on which the company makes its living. While any number of smart folks work for Canadian cities, their jobs rarely involve going up against a Silicon Valley behemoth with unlimited resources that's systematically exploiting holes in their regulatory system.

This leaves Uber in the enviable spot of dealing with an interdepartmental mish-mash of lawyers, transportation officials, taxi regulators and mayoral office staffers who are all trying to get up to speed on a file their opponent mastered long ago. It's a situation tailor-made for a divide-and-conquer strategy.

On that note, Uber lobbyists are also ready to seize on any schisms they find on city councils, making sure sympathetic ears are listening, while keeping pressure on opponents.

Toothless bylaws

Another advantage for Uber is the toothless nature of municipal regulations, relative to federal or provincial laws. Uber can afford to be brazen with municipalities when the biggest risks are tickets or fines.

"If the province wanted to be involved, then it would be a different thing," said Mariana Valverde, an expert in urban law and a criminology professor at the University of Toronto. "But provinces are, I think, washing their hands of it and leaving city councils to somehow struggle with it."

A lack of municipal clout leaves cities reliant on court challenges, which are time-consuming, expensive and never a sure thing. Compared to going up against the power and resources found at higher levels of governments, cities are a dream opponent for Uber.

That may be the reason Uber still isn't in Vancouver.

The company's absence in the heavily populated Lower Mainland, according to Uber Canada spokesperson Xavier Van Chau, is due to the regional supply-and-demand dynamics of transportation, as well as a prioritization of other markets.

Despite that explanation, it seems worth noting that in British Columbia, unlike Ontario and Alberta, the taxi system is regulated at the provincial level.

Kate Upton!

Decades of pent up ill will for the taxi industry is yet another factor that plays into Uber's hands. In fairness, regulators, which have saddled cab companies with all manner of requirements, should shoulder some of the blame for the higher costs of the current system. That said, the regulations do exist for good reasons: passenger safety, road-worthiness of vehicles and ensuring enough cabs are on the road in good economic times and bad — all of which Uber does its best to sidestep.

Regardless, for Uber, winning a public relations fight with the taxi industry is like shooting fish in a barrel. Anyone who's been stood up by a taxi, had trouble flagging a taxi while shivering on a street corner, or has grumbled about the cost of an airport fare is a ready-made advocate for an alternative option. Potential Uber supporters in every big city across Canada number in the hundreds of thousands. To vote-counting city councillors, numbers like that matter.

Made you look. Uber knows that marshalling celebrities, like supermodel Kate Upton, is a sure-fire way to gain attention. (The Associated Press)

A look at some of the company's other PR tactics reveals a local market savvy that further speaks to why Uber's fans vastly outnumber its detractors.

In New York, celebrities like Kate Upton and Ashton Kutcher have been rallied in the fight against Mayor Bill de Blasio. In Portland, a popular unicycle-riding street performer with fire-breathing bagpipes was tabbed to be the first passenger for the UberX service. In Calgary, that role went to Brett Wilson, a former Dragon's Den investor and high-profile philanthropist.

In the same way the Unipiper reflects Portland's "stay weird" ethos, Wilson is a pitch-perfect choice for the iPhone toting, young-guy-in-fancy-jeans demographic that Uber wants to reach in Calgary.

So fitting, in fact, he could be a case study that shows just how well Uber understands its markets. Wilson's brand of sanctioned rebellion is typical of a certain type of downtown Calgary swagger. He maintains a self-made-billionaire-from-Saskatchewan blend of affluence and populism that appeals to Calgary's perception of itself as a straight-talking city that appreciates the finer things and a barn dance in equal measure.

Although he doesn't have a financial stake in the company, the ride-hailing app has become something of a crusade for Wilson, whose involvement turned into an attention-grabbing home run when he offered $100,000 donation to local libraries if Calgary changed its bylaws to allow Uber.

"Have I raised the profile of the issue? Have I embarrassed a few people because they can't get their act together?" said Wilson. "All I'm doing is pushing them down a path they're already walking."

About the Author

Paul Haavardsrud

Paul Haavardsrud writes for CBC's western business desk in Calgary. He is also a producer on CBC Radio’s national business desk where he talks about business on Radio One in the afternoons. Prior to that he worked for newspapers. On Twitter, he’s @paulhaavardsrud.


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