Uber wisely over-communicates about surge pricing ahead of busy holiday weekend
Uber’s surge pricing has landed the company in hot water on countless occasions.
Most publicly were the company’s arguably tone-deaf response in the lead-up to floods in NYC in fall 2012*, where rates climbed as people tried to get home from work or leave the city. More recently, Uber came under fire (unfairly in my opinion) in San Francisco for what many claimed was profiteering off of a tragic BART fatality and rail service interruption. Large public events like concerts, festivals, and popular holidays have also head to their fare share of incindiary headlines. [*Update: An earlier version of this piece incorrectly attributed the floods incident to Hurricane Sandy.]
So it should come as good news to consumers and consumer protection watchdogs that Uber is being particularly proactive in communicating with its users ahead of the upcoming holiday weekend. In an email sent to Los Angeles customers about an hour ago, the company writes:
As you finalize your weekend plans, keep in mind that tomorrow will be one of those rare evenings when every witch, mummy and Miley look-alike wants to leave at exactly the same time.
We're always committed to providing reliable rides, even on Halloween. Here are some tips to make sure your All Hallows' Eve is full of treats.
- Get a fare estimate. No surprises — estimate your fare in the Uber app before requesting a ride.
- Split your fare. Share the cost with your friends in the car.
- We'll let you know when demand has settled. Send yourself a notification after you select your desired pickup location.
- Lose your wand, tail or wings? Don't stress. If you leave something in an Uber, get in touch with your driver at riders.uber.com/lost.
You can be a million different things tomorrow night — we want to make sure "someone with a safe, reliable ride home" is one of them.
[Emphasis, Uber’s.] Even if most regular Uber users are aware of the above product features, holidays tend to draw out new and irregular users, exactly the kind that can wind up “surprised” after receiving a receipt after a several hundred dollar fare. In that sense, Uber is wise to preempt these complaints with the above reminder and tutorial.
The company has also increased its in-app user-interface clues to alert, even the most inebriated users, that the upcoming ride will carry surge pricing rates – a necessary change driven by one too many critical headlines, and subsequent refunded fares.
Lyft, on the other hand, which is Uber’s biggest competitor (other than traditional taxis and the various apps that summon them), has yet to send any similar Halloween-focused heads up. That said, Lyft, which is considerably smaller, has been less of a target for “Surge” or “Prime Time” pricing critics. We’ll see if that pattern holds true or whether the pink mustachioed company will face a similar backlash tomorrow or during upcoming periods of high-demand.
As I’ve written previously:
...as Uber [and Lyft have] always explained, surge pricing exists for the specific purpose of incentivizing more drivers onto the road to deal with times of increased demand. Surely the demand in and around Palo Alto was at unprecedented levels, those which a standard Wednesday evening crew of drivers would struggle to meet. By contrast, traditional cabs have no way to incentivize additional drivers onto the road, and while dispatch may be able to call off-duty drivers and ask them to clock in, there’s no mechanism to provide financial incentives for them to do so. So while unsightly, the surge in this case likely served its purpose.
As with most situations of this type, where Uber [and Lyft run] into trouble is in the communication and transparency around [their] actions. Hopefully for Uber and its riders’ sakes, this weekend will go smoothly, and provide another example of how the company can deliver a truly disruptive service, while respecting its customers (and the laws of the land). No doubt several someones will still wake up with sticker shock at the bill for their late night ride home from that costume party, punctuated, of course, by a trip through the Jack In The Box drive through. But at least Uber will be able to point to this email and say, “We warned you.”