Look Out Cannabis, Here Comes Uber
Uber has disclosed it has been lobbying in favour of the SAFER Act, whose passing may facilitate Uber’s entry into the US cannabis arena. That Uber or other large, technology companies are sniffing around cannabis is neither new or surprising given the weed sector’s size and prospects.
Uber has already dipped its toe in the Canadian cannabis space with a partnership with the retailer Tokyo Smoke. Consumers can order product and arrange pick up via the Uber Eats app (delivery is not available, yet).
What me, worry?
Many will slough off the Uber threat as being too abstract or far in the future. However, they do so at their peril.
Uber is much more than an asset-lite, freelancer-based delivery, freight and ride-hailing service. They are a US$135B market cap, e-business platform that lives off your data. Uber ‘slices & dices’ this data to continuously improve their value proposition, operations and costs, not mention selling the data to third parties.
Anything that needs to be moved from point A to point B is in their crosshairs. For example, their highest growth segment is freight.
A wolf in wolf’s clothing
Uber is a bona fide industry disruptor that has put many taxi companies out of business and snagged a big chunk of restaurant industry profits. Where they choose to compete, Uber can also mobilize significant political influence and force regulatory change.
The fact that Uber is not profitable is not a reason to underestimate them. Their modest Canadian foray is about learning the cannabis business, not profits.
They bring scale, capital and millions of entrepreneurial drivers to a cannabis industry ripe for disruption and better business models.
It’s the consumer, stupid
Perhaps the biggest threat is on the consumer side. The biggest cannabis buyers, Gen Z, are also the biggest users of ride-hailing and delivery apps – and the most comfortable buying online. Uber deeply understands the habits of tens of millions of consumers who not coincidentally are also weed buyers.
Chill out
Uber’s American entry won’t happen tomorrow. Some regulatory dominos around credit card payments, banking reforms and product handling need to fall into place. Most believe this is inevitable especially when other like-minded technology behemoths such as Amazon share their appetite for large, virgin markets.
While concern is warranted, paranoia is not constructive. Uber and/or Amazon won’t lead to cannabis monopolies as some pundits suggest nor will it undermine from what really counts: producing high value products, services & experiences consumers want to buy.
Cannabis leaders, you’ve been warned.
#Uber #disruption #delivery #ubereats