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Uber learns lesson in Nairobi

Vince Matinde | Aug. 24, 2015
The global ride-hailing service has to adapt to local customs.

Uber has been operational in Nairobi since January this year, and the company's experience in the city has been a sort of test case for what it can learn as it expands internationally.

Nairobi is being hailed as one of the fastest growing Uber cities, overtaking South African cities such as Cape Town and Johannesburg. Credit cards are not used in the city as frequently as they are elsewhere and this has forced the company to adopt cash payments in a two-month trial period that has produced tremendous results for the company.

In the limited trial period, Uber has seen a growth in rides, to three times its previous numbers. New driver acquisitions have doubled and their user base has grown five fold. The company said that, “Nairobi is one of the fastest growing cities internationally for Uber following the launch of the cash test pilot. It showed there was huge pent up demand for the Uber service.”

Alon Lits, the Regional General Manager for sub-Saharan Africa at Uber, thinks that there are factors other than cash payments that are in play.

The East African region is known for its use of mobile money services as opposed to credit and debit card payments.

“We have really been impressed with the growth and how quickly Nairobians have embraced the technology. The challenge we initially faced was the cash aspect," Lits said.

Uber does face, however, resistance from drivers of other services. Some private cab company drivers say that the service is undercutting them by offering very low fares. One Uber driver, who wished not to be identified, said she sometimes fears to be identified as an Uber driver.

However, Lits explained that once they meet the company requirements, private taxi company drivers can still sign up for Uber, and also do their regular work without interruption.

“The only requirement is that if they are busy with their own clients they are offline [on Uber],” Lits said.

Uber is also trying to engage the country’s policy makers to avoid any legal issues.

“We welcome regulation. We have had engagements with policy makers," Lits said. "They see the benefits that Uber can bring to the city and to riders."

The growth of smartphone usage in Nairobi has also helped fuel the growth of the service. Lits said that the eagerness of Kenyans to adopt to technology is a huge sign that the business will flourish in Nairobi and hopefully in other cities in the region.

The Uber service in Nairobi is the first in Africa to customize its application for deaf and hard of hearing drivers. The partnership has been made possible by a collaboration with the Kenya National Association for the Deaf.

 

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