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Turning the Tables: How On-Demand Economy is Helping Big Businesses Find Relevance?

By Tushar Gupta 16th January 2017

Another weekend for Jane, and another business trip to reckon with. Fortunately, she has earned enough cash points from her American Express Credit Card transactions to avail a free plane ticket with one of the leading airlines. As she goes online to complete her booking, she avails the Airport Shuttle service from Uber which is a part of the complimentary offer the airlines has to offer. For Jane, the fun doesn’t end there. Since she has opted for Uber, she qualifies for a free spa as a ‘preferred guest’ at one of the leading hotel chains in the city, given the marketing merger between Uber and the hotel chain.  Welcomed at the hotel, she learns about the discount she can avail on her meal at the recently launched restaurant if she uses her Credit Card, and as she makes the transaction, she pockets another offer from the nearby coffee place, courtesy of the tie-up between the coffee chain and her bank. Sipping her coffee, she pays the bill using her American Express Credit Card, and guess what, she already has started garnering cash points for her next free plane ride.  

Back in 2013, Jane wouldn’t have imagined that a cab ride with one of the yellow taxis in New York would lead her to offers with a leading hotel, restaurant, or a coffee shop. For Jane, fetching a taxi in the busy hours of the Big Apple was a challenge itself. However, it all changed in the last 3 years, and it all started with an investment from Google Ventures, a vertical of Alphabet Inc, the parent company of YouTube and Google. With a valuation of $3.5bn back then, no one would have backed Uber with a $258mn deal, and yet, Google Ventures did. Today, Uber stands strong with a valuation of $66bn. It’s remarkable presence in 400 different cities across 68 different countries is a story we can reserve for another day. Following the lead of Google Ventures and the growth of Uber in Asia, China Life Insurance, and Times Internet made hefty investments in Uber, signaling a shift from the conventional thought process of the biggest corporates across the planet. Uber’s success had ensured the arrival of On-Demand Enterprise, and Google Ventures’ investment had marked the arrival of big businesses in this Gig Economy. The young and old came together for a partnership that changed the face of utility services.

Without owning a single car, Uber is the biggest cab service in the known universe. Without having to rent or own a single room, Airbnb succeeded in running an impeccable homestay service. Keeping the legal road bumps aside, it has been a progressive ride for enterprises focusing on On-Demand services. While the leaders have set the trends, the growing ones have taken a cue from those trends, and like every market, this too has seen its share of failures. However, the theory of Darwin prevails, and people across the world find themselves catered to by numerous On-Demand services, ranging from strangers who can walk their dogs to professionals who can help them find their lost TV remote.


When it comes to evolving business methodologies, you either adapt or become a distraught fragment for the history books. The Corporates knew their ‘Theory of Evolution’ well, and therefore, were quick to find opportunities for expansion and mergers in the existing On-Demand Enterprises. Back in 2015, Starwood Hotel partnered with Uber for its new and existing ‘Starwood Preferred Guest’ members. Users were required to link their accounts via the hotel website. Once they completed the qualifying stay at any Starwood hotel, they garnered one ‘Starpoint’ for every single dollar spent on Uber. A few lucky riders were given free night stay along with additional  Starpoints by Uber. While Uber was motivating its riders to stay at the Starwood hotel, the management at Starwood was bringing riders to Uber, thus marking a victorious partnership between the two.

How could Hilton, Starwood’s competitor stay behind? In the same year, Uber and Hilton came together for a unique partnership where Hilton’s reservation emails helped users book a ride with Uber to reach the hotel or the venture to other local places. Following the lead of Hilton and Starwood, universities also tied up with Uber during the peak season in order to woo students and parents with various offers. For the fans of ‘Back to the Future’, Uber came together with Pepsi in London to offer their customers free rides in the ‘DeLorean’ (the car from the movie), along with a complimentary Pepsi that was packed in a vintage bottle. Awe inspiring, the merger certainly clicked with the users, and not just the fans. BMW also tied up with Uber to promote its recently launched BMW 7 Series.

Uber v/s Netflix and some other companies it has recently surpassed in terms of valuation;

Uber v/s Netflix and some other companies it has recently surpassed in terms of valuation;

When it comes to payments, several digitized payment platforms and wallets have their mergers with On-Demand enterprises. In India, Paytm partnered with Uber to help people with a cashless riding experience, something that was entirely new for the world’s biggest developing economy, and for the Mastercard holders, a free ride was offered for every three rides paid for with the same card. Similarly, in the US, PayPal had several promotional offers for the Uber riders using the former to make payments. Last year, Uber came together with Capital One Financial Corporation. Helping users with a free 10th ride up to $15 with Capital One Quicksilver Cards, Uber also added several payment rewards for its regular users.

The Uber merger story is just one leaf of a very big tree. With endless enterprises in play, big businesses are curious to explore opportunities for partnership that can benefit both the variables of the business equation. While the big giants like American Express, Capital One, Hilton, and PayPal bring the trust factor and a loyal user base to the table, the on-demand enterprises offer convenient utilities with an impeccable quality.

While the On-Demand industry, despite the periodic hiccups, thrives on growing as a trillion dollar industry by the end of 2022, the big businesses are now turning to these unconventional startups of yesterday to seek relevance for their sustained existence. By the end of 2017, we are going to see a greater number of big businesses partnering with such enterprises, not just in the US, but across the globe, especially in China and India, where a third of the Earth’s population offers an extensive market for any and every kind of utility service. As it has turned out in the preceding years of the ongoing decade, the tables have turned for the corporate giants, and for them, redemption is not going to be possible without the relevance that comes from the enterprising world of On-Demand Economy.


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