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Why did Uber Fail in China? A Service Science Perspective
Authors: Christoph Breidbach (The University of Queensland, Australia)
Three years after commencing operations in China, ride-sharing platform ‘Uber’ announced its takeover by local incumbent ‘Didi Chuxing’, and exit of the market. The business press immediately linked Uber’s failure to sustain its Chinese operations to local government interference. Our present work, however, presents a different perspective and argues that Uber’s inability to succeed in China can be linked to repeat instances of service failure, as well as the firm’s inability to co-create the service experiences Chinese individuals are accustomed to. We draw on findings from two complementary empirical studies that cover the entire process of Uber’s service internationalization from the perspectives of local (e.g., Chinese) customers. Specifically, study 1 provides insights into how Chinese customers perceive Uber and Didi’s service experiences through a content and sentiment analysis of over 20,000 microblog postings uploaded between 2013-2016 on the Chinese social media site ‘Sina Weibo’. Study 2 reports provides complementary insights through a qualitative phenomenological inquiry involving 32 Chinese customers of Uber and Didi, reporting in-depth insights into the lived experiences and context of these individuals. As such, our present work contributes to service theory and practice by responding to Ostrom et al.’s (2015) call for service research to understand interactions and value creation in rapidly-changing and dynamic information communication technology (ICT)-enabled environments. We inductively build theory drawing on the concepts of service platforms, actor engagement in ICT-mediated contexts, as well as engagement platforms, thereby offering new insights into how service platforms set in the sharing economy context may facilitate actor engagement and value co-creation in culturally and regulatory diverse service ecosystems set in the context of the sharing economy.