Uber wants to be the only application you need on your phone. For years, executives talked about building a massive super app. Now, as self-driving companies like Waymo steal passengers in San Francisco, Uber feels a new sense of urgency. The ride-hailing giant wants to lock in its 199 million monthly active users before competitors pull them away to other services.
Two weeks ago, Uber executives took the stage at the annual GO-GET product event in New York. They finally revealed a new feature they had planned for a long time. American users can now book hotel rooms directly inside the Uber app. The company teamed up with Expedia Group to offer access to more than 700,000 properties around the world.
The company hopes these new features will drive massive signups for its monthly subscription program. An Uber One membership costs exactly $9.99 a month. Under the new hotel program, members receive a solid 20 percent discount on a rotating list of 10,000 specific hotels. They also get 10 percent back in account credits to spend on future rides or food orders.
Uber refuses to stop at just hotels. Later this year, the company will add vacation rentals through a partnership with Vrbo. Users will also gain the ability to book restaurant tables through OpenTable without ever leaving the Uber app. The development team even launched a new tool called Shop for Me, which lets customers order items from local stores that do not officially partner with the delivery platform.
Praveen Neppalli Naga serves as the Chief Technology Officer at Uber. He recently spoke at a technology event in San Francisco and explained the company strategy. He noted that the super app concept works perfectly in places like India and Southeast Asia. However, American companies usually fail at building them because they just slap random features together. Naga believes companies must give users a genuine reason to stay inside the ecosystem.
For Uber, that reason is the membership program. Naga explained that adding new categories like groceries, food, and hotels makes the $9.99 monthly fee feel like a great deal. He envisions a smooth customer timeline. A person takes an Uber to the airport, catches a flight, takes another Uber to a hotel, and then orders food to their room.
The company might eventually add flights to that list. Uber tried to sell airplane tickets in Europe a few years ago but failed to gain strong traction. When asked about bringing flights to the American app, Naga simply said they need to get the hotel feature right first. He also hinted at adding banking services, pointing out that Uber already issues debit cards to drivers in Mexico.
Rival companies see the exact same opportunity. Airbnb currently views Uber’s hotel push as a direct threat to its business model. In late March, Airbnb launched its own transportation feature. The vacation rental company partnered with Welcome Pickups to offer airport rides in 125 different cities. Meanwhile, Elon Musk wants to turn his social media network X into an everything app. X currently claims 500 million monthly active users, and Musk plans to launch a banking platform called X Money very soon.
Uber faces a tough battle in the United States. Most American consumers already have dedicated apps they love for booking hotels or ordering packages. To win them over, Uber must offer massive discounts or make the entire process incredibly simple. Uber thinks its main advantage is customer trust. Millions of users already gave the company their credit card numbers, so booking a hotel takes just a few simple taps.
The company makes a strong case for its strategy with its food delivery success. During the first quarter, Uber Eats revenue jumped an impressive 34 percent compared to the same time last year. The delivery business pulled in exactly $5.07 billion. Food delivery now grows faster than any other part of the company, and it brings in almost as much money as the main ride-hailing business.
Despite this massive revenue growth, Wall Street investors remain a bit skeptical about the grand super app vision. Uber stock still sits about 8 percent lower than it did one year ago. However, the subscription numbers tell a very different story. Right now, exactly 50 million people pay for an Uber One membership. Those loyal subscribers currently generate roughly 50 percent of all bookings across the entire company.
