Want to know the secret to earning more money as a rideshare driver? You need to join the Show Me the Money Club! Luckily, it’s free, and senior RSG contributor Sergio Avedian is a founding member. Below, he shares what the Show Me the Money Club is, the trends he’s seeing in his market, and how you can use the club to earn more on your own schedule.
When I drive these days, I have a few goals in mind. But the top of my list is occupied by making the most amount of money in the least amount of time.
If I was a true Independent Contractor (IC), I would be able to name the price for the job and the choice to undertake such without the threat of losing my job (deactivation). But in the rideshare world and the gig economy in general, I don’t have that luxury.
As much as Uber/Lyft tell us that we are ICs, we are not! Other than turning the app on and off when we want, our success and failure is dictated by very sophisticated algorithms. We truly have no control over our income potential.
With my pocketbook in mind, I started to drive on a very part-time basis in Los Angeles a few months ago. Initially, the bonuses and incentives were very lucrative to lure me in. My results (screenshot below from 2021) were matching or surpassing my 2017 earnings.
Back in 2017, I would easily make $50 an hour, but the ensuing fare cuts in 2018 and 2019 (Los Angeles Uber base rates 60/21 cents, Lyft base rates 80/12 cents) took a toll on my bottom line.
Having been in the rideshare gig for over five years, I knew the party wouldn’t last, but I was intent on taking the Uber/Lyft cash for as long as I could.
It continued until I started noticing disturbing trends developing a couple of weeks before the 2021 holiday season. Quests and Consecutive Ride Bonus (CRBs) were drastically reduced or eliminated by the greedy algorithm bosses (Uber/Lyft). Uber and Lyft had successfully achieved their goal to remedy the driver shortage: they flooded the marketplace with millions of cars like they had done right before the pandemic started.
Join the Show Me the Money Club
A rideshare driver has a ceiling on how much per hour he/she can earn. We physically can’t do more than 3-4 rides an hour. With various strategies, I have increased my earnings appreciably over the years by gaining the experience needed to be a top driver. However, ultimately I am not in control of the variables such as passenger demand, per mile/minute pay, seasonality, COVID, Uber/Lyft algorithm changes, etc.
I am in control of one thing – when to turn my app on or off. That is all we get as ICs, nothing else. This is the so-called freedom and flexibility card that has been played by Uber/Lyft PR machines to the point of passing Prop 22 in CA, with the backing of $220 million. Well, I am taking their advice – I will not drive or even turn my app on when they don’t show me the money!
Do these executives even think for a moment that there would be an Uber, Lyft, DoorDash, Instacart, or other delivery apps without drivers? So, I’m taking a page out of their playbook and returning the favor. They cut the Quests, I drive less, they reduce the CRBs, they oversaturate the marketplace with cars, I won’t even start my car.
Are The Drivers of Los Angeles Joining the Show Me the Money Club?
From the looks of the Uber driver app, a lot of drivers in my city may be joining the club. A few weeks before the 2021 holiday season, the surge that was consistent in Los Angeles disappeared (screenshot below on the right).
Was it that demand fell off the cliff? Was it the Omicron variant keeping people at home? Admittedly, surge coupled with terrific incentives was a boon for the drivers. Everyone was making money, even the ants (rideshare lingo for drivers who accept every ping regardless of profitability)!
Then the maps turned pale white. There was no surge even during morning and afternoon rush hour (screenshot below on the left). Adding insult to injury, the Quests and CRBs were slashed by Uber/Lyft.
I came to the conclusion that Uber and Lyft had oversaturated the marketplace to cut down on rider pick-up ETAs once again, like they had done before the pandemic.
I decided to park the car in the garage, which is one of the many privileges of the SHOW ME THE MONEY club! No surge, oversaturation, diminished or eliminated Quests and CRBs for me. I decided to take advantage of the freedom and flexibility Uber/Lyft offer and not waste my time. Base rates, as I mentioned above, are not going to produce the results I had gotten used to a few months ago.
Then late January 2022 rolled around. Uber had lowered the incentives so much that even the ants must have stayed home or possibly joined the SHOW ME THE MONEY club! What do I see? The driver app looked like the Red Sea during morning rush hour. This trend has continued for five days straight now.
Why is that? Drivers have had it with Uber and decided to stay home and not work for peanuts. It wasn’t that suddenly the demand exploded, as all the reasons for the slowdown I mentioned above are still present. Looking at these maps, even the ants decided not to take the sugar!
Takeaways for Uber and Lyft Drivers
Who benefits from the constant experiments and cat and mouse games that the Uber/Lyft algorithms play? Is it the driver? NO! Due to oversaturation and lowered incentives, we are not making the money we were when there was a shortage of supply.
Is it the passenger? DEFINITELY NO! Riders are paying much higher rates than the pre-pandemic days. But now they’re getting picked up faster because of oversaturation.
Is it Uber/Lyft? YES! Uber and Lyft have lowered the driver incentives enough to increase their take/hold rate (the percentage they keep from the passenger fare) to above 50%.
As a seasoned veteran, having experienced all the games Uber/Lyft play with the driver app, I can attest that the surge we see on the app is easily manipulated by super fast algorithms. I would be in the middle of a $10 Flat Rate Surge zone, then turn my app on to see that it is instantly halved.
Why does Uber show an amount that I am not going to get paid? Has that happened to you? Is it for them to entice me to turn my app on? Their asymmetric information advantage over the driver and passenger is undeniable.
One thing is glaringly clear to me. We as drivers can control our destiny by taking a page from the Uber/Lyft Prop 22 playbook. We are free and flexible enough to create temporary driver shortages and dictate to Uber/Lyft to pay us fairly.
WELCOME TO THE SHOW ME THE MONEY CLUB!
-Sergio @ RSG