Before becoming a full-time blogger, I worked in the corporate world for six years as an engineer. One of the most important business lessons I learned during that time is that income diversification is vital to long-term success. All too often, I saw employees becoming way too reliant on their bi-weekly paycheck and never even consider alternative sources of income.
When things went south (lay-offs, re-structuring, losing a big contract, etc), they were forced to make life altering decisions in order to maintain their lifestyle. I never want to be in that position.
When I first started driving for Uber and Lyft on the side in 2014, a lot of people asked me why I would ever want to do that on top of my day job. Didn’t I make good money as an aerospace engineer? The answer was a resounding yes but I also recognized the value of income diversification. I wasn’t making even a quarter of my day job salary as a rideshare driver but I was giving myself options just in case.
Those same principles can be applied to current rideshare drivers since now that you are all business owners, income diversification is more important than ever. It’s very easy to flip on the app and go out and drive to make money but there are also plenty of opportunities outside of driving that you need to be taking advantage of.
Are You Taking Advantage of Driver Referrals?
I have been telling people for a while now that driver referrals will be drying up sooner rather than later. Uber, Lyft and Sidecar have been offering anywhere from $50-$1,000 for referring new drivers for the past year and surely this trend would not continue forever. I was wrong.
My wife will tell you that I don’t like to admit when I’m wrong very often, but in this case, me being wrong is a good thing for all of us. The TNCs have proven over and over that their top priority right now is growth. And even though it probably doesn’t make a whole lot of financial sense to pay out such high referral bonuses, those bonuses continue to fuel their exponential growth.
The most recent example of this was the now infamous Lyft $1,000 double sided referral bonus. According to my sources at Lyft, they received 25,000 new driver applications. And while they were nowhere near adequately staffed to handle the volume of applications, if I had to guess, they did end up approving somewhere around 10,000 new drivers. That’s $10 million in potential driver referral bonuses.
Do I have your attention now?
Current Driver Referral Bonuses
I know I talk a lot about working smarter, not harder and in my mind, taking advantage of driver referral bonuses is about the smartest thing you can do right now as a driver. Opportunities like this don’t come around every day and most people don’t have the mindset to take advantage of them when they do.
But if you want to be the best at what you do, there is a huge opportunity right now with driver referrals. Here are just a few of the current promotions available for referring new drivers.
- Uber – Refer a new driver and get up to $150 after 20 rides (amount varies on market)
- Uber – Refer an existing Lyft/Sidecar driver and get up to $500 after just one ride.
- Sidecar – Refer a new driver and get $100 after 10 rides with the code HARRY86.
- Lyft – Refer a new driver and get $50 after 20 rides.
- HopSkipDrive – Refer a new driver and get $100 after 5 rides with the code ‘RideshareGuy’ (Los Angeles only).
I love to drive, but at the same time, I also know how much work goes into making $100 as a driver. The time, the wear and tear on your car, etc – it’s a lot to worry about. I don’t think you should give up driving exclusively in favor of referring new drivers but I think it’s a no brainer to use driver referrals to create another source of income.
Driver referrals aren’t just limited to the big three either. Just last week, my friends over at HopSkipDrive reached out to me to let me know that demand for rides is off the charts (they provide rides for minors) and they are now paying $100 for new driver referrals.
On demand companies have really embraced this driver referral method and there is a lot of money at stake. Going forward, I think we’re going to see more and more of these smaller, niche companies paying out referral bonuses to existing members in order to recruit new ones.
Strike While The Iron Is Hot
Even though it might seem like it, these driver referrals won’t last forever. A savvy business owner will be able to identify opportunity and take advantage of it while it lasts. When Lyft announced their $1,000 double sided referral bonus, I started contacting friends and family ASAP. I didn’t wait around because I knew an offer this good would not last forever, and I was right. The offer was slated to last a week, but only lasted 24 hours.
If you’re ranking the current driver referral bonuses, obviously the Uber $500 promotion should stand out and while I know some of you are taking advantage of that one, there are many who are not. I use my blog as a huge source of referrals but I’m also always trying new things every day in regards to referring new drivers. At $500 a pop, it’s insane not to.
I’ve carried over a lot of the ideas that worked for my Ultimate Passenger Referral Podcast to my new driver referral strategy. And here’s a list of all the methods that I’m aware of that drivers (including myself) are using to refer new drivers. I don’t do all of them and some may be pushing it for some of you, but for others it could be just what you’re looking for:
- Online Marketing – Some drivers have taken to online forums and even building small sites of their own to try and refer new drivers. You may have some success here but I think the tactics required are a bit spammy. And since it’s pretty easy to do, there is also a lot of competition.
- Stalking Drivers – On Episode 10 of the podcast, we interviewed The Black Car Guy who told us about his strategy of stalking Lyft drivers on the passenger side of the app and following them until they parked or stopped and then handed them a one page flyer with all the info they needed about signing up as an Uber driver in order to earn each of them a $500 bonus.
- Taking Rides As A Passenger – I think this is my favorite current recruitment method because it works on so many levels. If you’re looking to recruit new Uber drivers for example, you could take a bunch of rides on Lyft and Sidecar and see if any of them are eligible for the $500-$1,000 bonus. It’s a cheap investment since you could potentially do 100 $5 rides and as long as you’re able to convert one or two of them, you’ll make your money back and then some for your time. Plus, it’s fun to converse and meet a bunch of new drivers and at the same time you always learn a ton from taking rides as a passenger. I know of several drivers who are doing this with great success.
Ultimately, there are a lot of different routes you can take to the ultimate goal of referring a new driver. We know it’s important to diversify your driving income between Uber and Lyft but now it’s time to start thinking about ways to leverage other areas of rideshare.
Some drivers are scared off by competition but I tend to embrace it. Whether you realize it or not, being a rideshare driver is a great job and there are always going to be people willing to work for less. If you’re counting on Uber or Lyft to raise prices or depending on someone else to save the day, that is not going to happen. Ultimately, it’s your responsibility to figure out ways to make this business work for you.
Drivers, what do you think about all the strategies I covered in order to refer new drivers? Do you think it’s important to diversify your income with things like driver referrals or is just driving enough?
Make Every Mile CountDid you know that every 1,000 business miles can generate $535 in tax deductions? Never miss another mile with the new QuickBooks Self-Employed automatic mileage tracker.
-Harry @ RSG
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