Over the past several years, veteran drivers have seen big changes to the Uber and Lyft platforms. While some of them have been positive, like tipping, others have more mixed reviews. Today, senior RSG contributor John Ince shares his insight into how the rideshare experience has changed for drivers.
Uber has been making a big deal of their 180 Days of Change lately, and how they’re making the driver experience better. Some of the changes are long overdue and clear improvements, but in the 3 years I’ve been driving, I’m just not yet convinced that Uber (or Lyft) are really improving things for drivers. So I decided to do an overall analysis of the experience in my three years – with an attempt to quantify the changes.
Here I’ve divided the rideshare experience into 10 subsets and score the three year changes on a scale of 1-10, plus or minus. Thus, the highest possible score is plus 100 and the lowest possible score is minus 100. The ultimate goal is to figure out whether things are getting better or worse for drivers.
What do you think? Is your rideshare driver experience getting better or worse?
Sign On Bonuses Are More Complicated, Less Generous
This is understandable from Uber and Lyft’s perspective. At first they needed to get drivers on the platform and were willing to invest big time to accomplish this. Three years ago Uber was lavishing new drivers and their referrers with bonuses that sometimes were as much as $1000 for just one ride. Soon, Lyft followed.
Today, Lyft parcels out the bonus in increments and Uber’s sign on bonuses are tied to often unattainable levels of completed rides. Both companies are now saving a lot on money on driver recruitment, while drivers get little or nothing
Bottom Line: We all knew this was coming, but I’m sorry to see the bonuses become so much more difficult. Some people really made out big – earning more from bonuses than from driving. That era is over.
Net: Minus 5 points.
Rewards Get More Complex and Controlling
When I first started driving with Lyft three years ago, their incentive was that you got to take home 100% of fares. They took no commission – obviously an unsustainable proposition, but it made things really simple to calculate. You drove and you kept everything as long as you maintained a 90% accept rate. Now there are different options, each designed to exert more control over drivers’ behaviors.
Bottom Line: What did you expect? Of course they’re going to exert all the influence they can over drivers, and rewards are now targeted to get you on the road where they want, when they want. Independent contractors have become a little less independent.
Net: Minus 3 points.
They’ve Foisted UberPOOL and Lyft Line on Us
If you love UberPOOL and Lyft Line, raise your hand. I thought so. Nevertheless, the TNCs have made big bets to make these new cheaper products works to attract customers away from public transit. That potential moves ridesharing into much bigger markets.
But what about driver? More work for less pay. But wait, this just in from Harry on Uber’s changes to UberPOOL as of September 26, 2017:
“Today, Uber announced Chapter 4 of their 180 Days of Change initiative and it’s focused on improving the UberPOOL experience for drivers and riders and the changes will go live immediately in Uber’s 13 UberPOOL markets. – Drivers will now earn an extra flat fare every time an additional pickup stop is added to their trip. The additional pickup fare ranges from $0.50 to $1 depending on the city (e.g. LA is $0.95), but it doesn’t apply to the first pick up. The extra fare only applies to additional pickups.”
Bottom Line: Uber and Lyft are playing a numbers game. UberPOOL and Lyft Line vastly increase their growth numbers. Get used to it. They’re here to stay – unfortunately. The changes announced this week amount to little more than window dressing.
Net: Minus 4 points.
So Long Surge – It Was Good To Know You
If one views the driver experience as a crapshoot, the odds have gotten a lot worse for drivers over time. A big surge was like getting a good roll of the dice. You used to be able to count on a few big hits almost every night with big surges on the old platform.
Those days are disappearing fast. What you see is what you get now on the platform. Don’t hope for the big one – because you’re more than likely to be disappointed.
Bottom Line: From the passenger perspective, this is good news. For the driver, it’s bad news… and that’s mostly what driving for Uber is these days – bad news.
Net: Minus 5 points.
Changes to the App – Thanks for the Tip
Lyft of course has had in-app tipping forever – or so it seems. Uber was the stubborn holdout, but finally caved in. Turns out it really didn’t matter that much because tipping on the Uber platform remains very infrequent, in my experience. What’s your experience with tipping?
The app has been improved in other more subtle ways. For example, when I was first driving for Lyft three years ago, if I went over a bridge with a toll, I would have to keep track of it, then email Lyft customer service with a printout of my Fastrak statement, all of which was a huge hassle. Today, both Uber and Lyft automatically account for these things.
In that sense, the app and the experience are improving, but not all the changes are improvements. Some of the other changes have been steps backward for drivers. Uber no longer gives you the address of the pickup in the initial request screen, so it’s even more difficult to assess the desirability of the ride.
Both Uber and Lyft have tinkered with ratings but have failed to make changes that could easily improve the system, like factoring in the passenger’s history of ratings and discounting a bad rating from a passenger who routinely gives bad ratings. Ratings suck and always have. No change here.
Bottom Line: With all those highly paid software engineers and programmers on their payroll, one would think they could have made more improvements in this area. But maybe that’s not a priority for them.
Net: Plus 2 points.
Passengers Seem More on Edge
I’m not sure what exactly is the cause here. Nor am I sure my impressions hold for the entire platform. But it does seem that the interaction with passengers is less interesting, less cordial, and less stimulating. I get more passengers who just want to chill or spend the entire ride on their smartphone. Maybe it’s the political climate. Maybe technology has overtaken our lives. Maybe it’s all in my imagination. What do you think?
Bottom Line: The bloom is off the flower? Three years ago, there was a genuine sense of excitement about ridesharing and the app was cool. Now, this is both a positive and a negative. Most passengers, by and large, know the routine, they know how the app works, and they’re better at putting down the pin
Net: Minus 3 points.
Driver Message Boards are Much More Fascinating:
As the rideshare world has grown, so too have the bonds of community. I often find myself checking UberPeople.net, the Reddit driver’s community, and San Francisco Driver’s Lounge on Facebook. Why? Because the rants are more real. The stories are more genuine. The comments are more outrageous.
Bottom Line: The rideshare community is growing stronger, bigger and better.
Net: Plus 5 points.
Welcome Destination Filter: What Took You So Long?
Destination filter has to be one of the most welcome changes in the platform, so I give it its own subset. When Uber increased DF to six/day, it was a real motivator to use their platform over Lyft.
But just when I was getting to like 6 destination filters/day on Uber, they backtrack. For those who haven’t seen it yet, Uber cut back destination filters to 2 per day. Their explanation?
“We have to be honest – this usage has increased wait times for rides and you may have notices a few long pickups … long ETA’s are bad for riders and drivers and ultimately impact the number of trips you receive and your earnings … While we test rigorously, the truth is we don’t know exactly how things will work out until they’re in the real world … To ensure the Uber platform delivers reliable rides and earning, we’re going back to 2 Driver Destination starting today.
Bottom Line: Really sorry to see Uber backpedal on this one. They made real inroads by increasing DF to 6/day. Now they’re back to ground zero.
Net: Plus 2 points.
Keep Your Mouth Shut and Drive
When I first started driving for Lyft, there were a lot of rumors about drivers getting canned for public disparagements of the company. This seems to have moderated a bit. Neither Uber nor Lyft seem quite so strict about badmouthing the company.
Bottom Line: Perhaps they’re more lenient because more people are speaking out.
Net: Plus 3 points.
Reduced Driver Pay Through Incremental Fare Cuts
When I was first driving, it was much easier to make a lot of money for only a moderate amount of driving. It’s been an incremental change, so it’s difficult to pin down. Now it’s a lot of driving for a little pay.
Part of it is the “creeping commissions.” At first Lyft didn’t take anything. Now they take upwards of 35%. Same for Uber. With all their assorted fees, Uber is sometimes taking more. Since pay is so important, I have to say that the net is still pretty substantial.
Then there’s the matter of decoupling driver pay from passenger fares: this practice has only recently come to light. This is potentially a huge step backward for drivers. Uber is essentially thumbing their nose to drivers by saying we can take whatever percentage of the fare we want.
This explains why they continue to keep passenger fares so low – the endgame for Uber is to put the competition out of business. Their business model is predicated on having monopolistic power. Until that point, they’re going to bleed red ink and only give drivers a minimum of what they need, in order to keep enough drivers on the road to satisfy demand.
Bottom Line: Both Uber and Lyft are under increasing pressure to turn a profit. $3 billion losses annually are not sustainable. But why do the companies always take the money out of the pockets of drivers and keep passenger fares so low? The bottom line here is the bottom line. Sorry, it’s a business.
Net: Minus 8 points.
Is it Better or Worse? Final Tally: Minus 16 points.
From my experience as a driver, the overall change to driver experience has been a net negative. This means working as a driver has gotten worse over the years for the reasons I outlined above – especially driver pay since that’s what matters most. While it’s clear you can still make a profit if you drive strategically, overall the experience of driving passengers, being your own boss and embracing flexibility is not what it was three years ago.
Am I wrong here? Is the driving experience better or worse? What has your experience been driving with Uber and Lyft? If you disagree, let me know in the comments below.
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-John @ RSG