This post originally appeared on Substack as a part of my newsletter, East Meets West.
Today’s issue will be different than my prior issues and will be slightly more topical.
In light of the current AB5 hoopla impacting gig workers in the state of California, it is interesting to contrast how western ridesharing companies market themselves and work with governments as compared to their eastern counterparts.
The TL/DR of AB5:
Uber and Lyft were subject to a recently-enacted California labor law, Assembly Bill 5 (aka AB5), which requires “gig economy” companies to reclassify workers as employees (instead of contractors). This means gig workers (in this case, drivers) would be eligible to receive benefits like minimum wage, overtime pay, paid leave, and health care coverage, etc.
In response to recent statements from California politicians, Uber, characteristically went on the attack:
“When over 3 million Californians are without a job, our elected leaders should be focused on creating work, not trying to shut down an entire industry during an economic depression.”
Uber isn’t wrong (*written with disappearing ink*)
What’s stood out in coverage is how scarcely I’ve seen government officials defend Uber and Lyft.
AB5 has been a looming threat since 2019, but only now as its flaring up are we beginning to see politicians speak out in support of Uber and Lyft. Part of that is likely political. Biden and Kamala came out being Pro-AB5, so naturally, Trump came out as against AB5.
I saw at least one California Democrat, San Jose Mayor Sam Liccardo come out against AB5. He smartly pointed out that about 500,000 drivers in California would lose their incomes if Uber and Lyft shut down.
Looking at Uber and Lyft, my real question is… why was their positive economic impact not ALWAYS their framing?
From Facebook to Amazon to Uber, tech and tech-enabled businesses are having a tough time working with politicians in the US. Looking at these companies’ eastern counterparts, I believe they can improve their approach to marketing and government relations in a way that can make the companies, politicians, and users happy.
Gojek and Grab have not been immune from criticism. But most of their criticism has come from the taxi industry (their competitor), not politicians.
In fact, politicians seem to love them.
Reflecting back to my Gojek issue, in 2015, the transportation minister of Indonesia was rebuked by the President for attempting to ban the use of personal vehicles by Gojek drivers. The transportation minister’s actions were seen as an effort to defend the taxi industry.
In response to the President’s rebuking, Gojek’s CEO tweeted, “Thanks to President @Jokowi for his support to 200 thousand Go-Jek drivers and 8-million of our application users”
A few months later, Indonesia’s President removed the transportation minister from his role. Then, a few years later, Nadiem (Gojek’s founder) was appointed by the Indonesian President to become Indonesia’s Minister of Education and Culture.
Could you imagine Travis Kalanick or John Zimmer being appointed to a government role in the US?
So what gives?
Well, since early on, Gojek’s marketing language made strong nationalist appeals. As one example, the jackets for each country’s drivers have their national flags embroidered on them. They made an effort to align themselves with all of the countries that they operated in.
Gojek also wisely highlights stats such as:
- “Do you realize that your order improves the Indonesian economy as well as the Indonesian society? Contributing IDR19 trillion [in GDP] in 2018!”
- They claim to have lifted the standard of living for 300,000 Indonesian drivers/partners
- After becoming a ‘unicorn’ Gojek claims they increased driver’s average monthly income by 15%
- When appointed to the Indonesian government, Gojek’s founder said, “We’ve created Gojek. An iconic company that flies the flag for the future of Indonesia and Southeast Asia.”
Now, it would be tough for Uber to highlight statistics like this on a national level in the US because they’re a much smaller % of overall GDP, but….
How to Work with Politicians
The best is approach is to proactively engage politicians at the local levels and then work your way up (cities —> states —> countries).
Unique to companies that operate in the physical world (i.e., Uber, but not Facebook), it is clearer to articulate the value proposition to local politicians that are actually looking out for their constituents (and not just grandstanding an agenda to further their own political careers or ideologies).
It feels like it would be hard for Facebook to convince a senator from Missouri that FB positively impacts that senator’s district (even if it does for example help that county’s small businesses better advertise).
However, it would be easy for Uber to share stats such as:
- How many people they helped to earn a wage in the past 12 months.
- How their average hourly salaries compare to the state minimum wage
- How many new driver sign-ups they have seen during COVID.
In the same way that some congresspeople in the US are pro-war because their district is home to defense contractors (that employ their constituents), there are a helluva lot more congresspeople whose constituents are contracting with Uber or Lyft to earn a wage.
Some of the dynamics at play for Gojek and Grab are not as available for Uber and Lyft. Gojek and Grab were able to create a clear story about how they are helping to bring their local countries into the technological revolution and are raising the average standard of living. The debate around Uber and Lyft sadly seems to be framed in terms of the haves vs. the have-nots.
Ultimately, it is possible to work with governments in a way that frames companies in terms of their greater economic benefits. It is easy to show that to reasonable politicians at a local level. As Gojek demonstrates, it’s possible to do this without completely kowtowing to governments or running afoul of the principles of Ayn Rand.
Thanks for reading❤️
(P.S., let me know if you like this type of content where instead of deep dives, I try to apply some of the general learnings from eastern tech to western tech news. Might be good for me to switch up the content every now and then since the deep dives take a lot of time to write.)