The potential risks of Uber and Lyft's strategy of spending on driver subsidies and promotional discounts include burning through a lot of cash, which could lead to financial instability if not managed properly. This strategy could also lead to a dependency on discounts and subsidies, making it difficult for the companies to maintain customer loyalty once these are reduced or removed. On the other hand, the potential benefits include gaining a larger market share and attracting more customers and drivers to their platforms. This could lead to increased revenues in the long run, especially if they manage to retain these customers once the discounts and subsidies are reduced or removed.
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