MKTG532 BRAND MANAGEMENT TERM PROJECT GUNCHA ANNAYEVA

Brand Audit Project: LYFT

Rise of social media and the world getting a smaller place, sharing is observed in most business

from post shares to clothes, houses and rides. Everyone uses and enjoys classy Uber ride service.

However, there are other as successful ride sharing services with brand differentiation. It is Lyft, an

American ride hailing driving service in the form of mobile application. It emerged in 2012, three years

after Uber was born and became a competitor to Uber. The competition is analyzed further in the

paper.

Short history of the brand

Lyft TNC, transportation network company

Established 2012

Founders Logan Green and John Zimmer

Mission “Our mission is to reconnect people through transportation and bring

communities together.”

Vision “Ride by ride, we’re changing the way our world works. We imagine a

world where cities feel small again. Where transportation and tech bring

people together, instead of apart. We see the future as community-driven

and it starts with you.”

Headquarter San Francisco, California and operates in 640 cities in USA and 9 cities in

Canada

Logo Pink Mustache

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Story of Brand Initially there was Zimride that evolved into Lyft in May 2013, and its

name founders have meet each other on Facebook Connect that university

students used to connect to give each other a ride.

Market Share 30% in US market

Additional Scooters and bicycle sharing

Service

2. Inventory: Lyft’s current inventory is evaluated to be in total assets of 1,380,412 USD and Quarter

1 report revenue is $776.0 million compared to $397.2 million in the first quarter of 2018, there is an

increase of 95 percent annually. Lyft provides the service of car ride, recently started scooter and bike

sharing services. Currently, it offers six rides options which are Share Ride (the cheapest but not

available in all cities), Lyft (basic and the most popular), Lyft XL (basic for up to 6 passengers), Lux(

luxurious care ride), Lux Black (the interior of the car if completely black), and Lux Black XL (ride for 6

people in the luxurious black environment).

• The symbol of pink mustache has transformed from big on car decoration into little shining

mustache on driver’s front dashboard. Slogan is sharing: “Life is better when sharing a ride.”

• Brand is known for the unique image of sharing a ride and it is safe because its’ drivers are carefully

selected, also it is mostly female drivers who are employed with Lyft.

Product Price

Place Promotion

Fig.1

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3) Marketing Mix at Lyft.

Lyft uses 4P of marketing mix (Fig.1) effectively since it differentiated and innovated its product in

2012. The idea of sharing a personal transport with someone seemed ridiculous at first. However, as

Logan Green and John Zimmer promoted their idea of the city for people and actually the fact that

sharing had a lot of benefits not only on individual level but on community and environment effect,

more customers got attracted to the product. Pricing is 20% cheaper than traditional taxi, however a

lot of drivers complain on pay. They say they are paid only 50% from clients charge, the rest goes to

Lyft. Obviously, pricing needs re-consideration. For place, Lyft operates in USA and Canada. It mostly

operates in big cities where demand for taxi is high. Additionally, Lyft has strong marketing campaigns

with mind sticking fluffy pink moustache and the idea of sharing itself is very appealing to participate

in.

4) Competitive brands: Lyft vs Uber

80% profit to driver, 20 % profit to the company 75% profit to driver, 25% profit to the company

User friendly Professional

Warm Distanced from passenger

Peer to peer product promise Business like attitude

Drivers control their workload, part-time Drivers are fully employed

More people are able to participate as drivers Only employed drivers

Promise more freedom for drivers Promise: safe and professional ride experience

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Lyft’s major competitor is Uber. There competition drives Lyft to improve and progress from

an your peer ride to more professional style. However, Lyft manages to keep warmth in its service.

Uber is perceived a more professional ride provider mainly to two reasons, it is cars are all black and

divers are more qualified to compare with Lyft. Uber is a global market leader of transportation

network company which expands not only in the regions but also aspects of work like food and

packages delivery. Recently, Uber started offering boat service ride in Turkey and Croatia. While Uber

expands globally, Lyft focuses on domestic market and only on ride service with expansion in scooter

and bike service offering. Additionally, Lyft holds one third of US market share and the dominant

market share holder is Uber. Obviously, competition is fierce for both market player because they

have constantly to work more and more professionaly. Also Lyft has to penetrate its innovative line

to stay competitive. To eliminate competition Uber’s CEO tried to buy out Lyft in its earlier days, which

John Zimmer and Logan Green denied to accept. After that they experienced hard days which Lyft

survived and grew its 1 billion revenue in 6 years almost like Uber. Thus as Lyft’s founders claim: “stay

focused,” and success is to come.

5) Brand exploratory: Understanding what customers think and feel about the brand:

Lyft is a ride hailing mobile application that is at the reach of the hand. Its’ founders made it as user

friendly as possible.

 To use Lyft you download it from Play or App Store

 Check for drivers available and select the one closest to you

 Check type of car and driver details, comments and rating.

 Book the car and track the ride

 Make payment with a card or there is payment option in the application

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Everything seems easy and satisfying to use. Regardless to its’ popularity. Some negative reviews are

flamboyant example of company’s requirements to grow and improve its service offering.

From the user generated content on Twitter, I found mostly negative and unsatisfied customer

feedback. Where people do not trust both Lyft and Uber service. A lot of complains both from drivers

and riders are shared on Twitter. While drivers demand fair pay for their ride, passengers mention

untidy car seats with some insects in it or other left overs from previous passengers. Additionally, the

main reason is the fact that @AskLyft twitter account receives the complaints and suggestions from

consumers but does not do anything indeed to improve the service.

“Generally, they have been ok…,” Eddie Richet

(https://twitter.com/lyft/status/1125433814459744257) a Lyft user starts his complaint about late

solved issue that he addressed at the Lyft company.

6) Strategic recommendations for the brand:

Lyft is obviously innovative market positioning brand. It is successful innovation and differentiation,

which promotes environmental and social founding principles to improve people’s lives. Thus,

customers choose Lyft for the sake of concept that it is great to share a ride with a nice driver and

connect to with a person in our modern detached world of mobile phones.

Addressing Pitfalls: on a big scale Lyft does a great job with shares growing and recent IPO in 2019.

The only point that needs improvement might be the image its pink fluffy moustache creates and

luckily company took care of this brand image. It fulfilled the function of being noticed in public places

but it looks more ridiculous with being fluffy. While a growing and expanding company like Lyft with

the idea of lifting mood and making people feel better about themselves would love to position itself

as smart. Eventually, the moustache became small plastic lamp in the form of moustache to put on

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drivers dashboard to be obvious for passengers. The rest I think company does a good job in improving

and sticking to its founding story of “ride share with a peer.”

7) Tactical recommendations as short-term marketing actions:

Brand valuation is to promote brand functionality, environmental and emotional benefits of brand.

Company’s mission is to “improve people’s lives with a best transportation” which I would focus more

on and promote on live and online ads as well as radio channels. Initially, Uber relied on word-of-

mouth recommendation, so should Lyft do to increase a trust and popularity among shareholders:

drivers and passengers.

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Reference

K.L.Keller, Building Strong Brands in a Modern Marketing Communications Environment

https://hbr.org/2017/09/competing-on-social-purpose

https://www.figmints.com/blog/5-companies-that-differentiated-in-crowded-markets-with-

brand-strategy/

https://rideshareapps.com/uber-vs-lyft-comparison/amp/

https://investor.lyft.com

https://distilit.com/

https://investor.lyft.com/news-releases/news-release-details/lyft-announces-record-first-

quarter-results

https://investor.lyft.com/news-releases/news-release-details/lyft-announces-record-first-

quarter-results

www.inc.com/magazine/201904/lyft

https://www.inc.com/magazine/201904/christine-lagorio-chafkin/lyft-john-zimmer-best-

business-advice.html

www.forbes.com/lyft

https://www.mbaskool.com/marketing-mix/services/17279-uber.html

https://www.mbaskool.com/brandguide/it-technology/12847-uber.html

https://twitter.com/lyft/status/1018953207815565317?lang=en