After a brief leave of absence, Uber’s Travis Kalanick has resigned from the company he founded amid pressure from five major investors on the company’s board. Kalanick is staying on as a board member.
The board demanded Kalanick’s departure in a letter called “moving Uber forward” making it clear that investors wanted a clean slate without Kalanick’s baggage. On Wednesday, The New York Times’ Farhad Manjoo gave credit to social media for Kalanick’s ousting.
“Posting a hashtag — #deleteUber, for instance, or #grabyourwallet — and threatening to back it up by withholding dollars can bring about a much quicker, more visible change in the world than, say, calling your representative,” Manjoo wrote.
The departure comes as an exclamation point after a long series of scandals that led to an investigation by former Attorney General Eric Holder: a toxic workplace culture of sexual harassment, a disregard of regulators, driver pay issues, scabbing, departing executives, and an insensitive video confrontation between Kalanick and a driver.
The scabbing scandal in particular, which had Uber promoting its services during a taxi strike over President Donald Trump’s travel ban, launched that social media campaign, #deleteUber, which went viral.
Kalanick is famous in tech and investor circles, but he’s no Steve Jobs
Despite the scandal’s viral visibility, Kalanick’s exit won’t mean that much says Justin Joseph, a professor of communications at Boston University who has closely followed Uber’s situation. The problem: not that many people even know who Kalanick is.
“if you think about the average user, 99 out of 100 couldn’t pick out [Kalanick’s] picture or [recognize his] name,” Joseph told Yahoo Finance. “It really is much more for investors than any stakeholder group.”
Joseph says bringing on Holder or a big-time law firm is usually something to calm investors who may be getting nervous. “These are short-term moves for an investor audience. Customers aren’t concerned with that,” he said.
This is especially true when the service works well for consumers and their needs are met. Thus far, consumers, it appears, haven’t been particularly concerned with Uber’s activities at all—despite the public shaming. Looking at rider data in the country’s largest city, New York, shows growth continue up at normal rates despite the scandals and social media response.
That doesn’t mean that changes can’t happen that can boost the public’s perception of the company. Just this week Uber announced a series of policy changes, including the adoption of tipping drivers, which had been something Kalanick was long against.
How many CEOs can the average person name?
A CEO’s departure isn’t that meaningful to consumers if the brand doesn’t have a strong recognition-based link with the individual.
“We have a lot of examples like this. If you have a brand that’s completely tied with CEO, it’s a very different situation,” said Joseph. “When a [less public] business person is at the other end, people’s decisions are based on price and convenience. How many make decisions based on CEO? Over and over again, it’s minimal at best.”
A key example of this in the past was former BP CEO Tony Hayward, who, in the words of Chicago Mayor Rahm Emanuel had committed a “long line of PR gaffes” that included attending a yacht race during the Deepwater Horizon oil disaster.
“People thought it was preposterous a CEO could say what he said during an oil spill,” said Joseph. “Now they can’t remember who he was.” And if they do, the association may not even be with BP—just a faceless guy from a nameless oil company.