Wednesday, November 30, 2016

Low Boost Cheapening Trips

Uber discontinued the guaranteed hourly earnings held during morning and evening commutes, as well as weekend evenings between 5pm-2am. Fortunately, drivers could earn at least $35 an hour on weekend nights while making up for lost earnings taking short trips and working at slow times. Furthermore, drivers would earn at least $40 per hour between 7am-9am and 5pm- 7pm. This guarantee could keep drivers on track to maximize earning potential servicing qualified regions during these times.

On the opposing side, drivers must follow specific guidelines to protect these guaranteed earnings. Failing to meet specific requirements would disqualify drivers from receiving hourly matches. The following requirements challenged most drivers trying to chase after this guaranteed hourly promotion:

- 90% acceptance rate (if a trip is missed during any of the 2-hour time increments, drivers will be disqualified).
- 67% trip origination (2/3 of all trips must originate in the approved regions. Drivers must beware of taking trips that could push their under this requirement. Most challenges occur when drivers are sent out to distance locations that put them at risk to miss this requirement. Uber will disqualify drivers based on this requirement).  - 1 trip or 2 trip per hour average (In the East Bay, drivers must average at least 1 trip per hour. In San Francisco, drivers are expected to average 2 trips per hour. It is highly possible drivers can get disqualified based on this requirement).
- Drivers choosing to operate during the guaranteed hourly format will only receive hourly matches. It is easy to receive a match, but is also challenging to lose a guaranteed payment. With a few minutes to go, a driver may receive a long pickup time. Once this driver approaches the pickup location long after the guaranteed hours had already ended, a long trip could end an hour or 90 minutes after the guaranteed cutoff time. For the most part, Uber will count this trip toward the guaranteed time slot because the trip request occurred a few minutes and even a minute before. If drivers were about to receive a guaranteed match, now this last trip could add to this earnings total and cancel out a guaranteed match. It doesn't whether this trip ended 60-minutes and/or 90/minutes after the cutoff time, what is measured against the total is that this trip request arrived right before the deadline. These trip earnings will impact the guaranteed payout.

What can complicate these guaranteed earnings: automatic UberPool matches, back-to-back trip requests, technical difficulty, poor signals, app glitches, client canceling trips while rides are in progress, and long trips outside of the qualified zone during 2-hour commute guarantees. Most drivers found this hourly guarantee promotion extremely challenging. A good portion of these drivers would fail to meet the promotion guidelines for reasons outside of their control. It is obvious Uber implemented tough requirements to disqualify drivers so they would not have. To pay hourly matches. If drivers were serious about this hourly promotion, they would have to understand all these requirements and make adjustments to receive matches.

Fast-forward to the new boost. Uber ended hourly guarantees, replacing this program with a boost. Boost earnings are offered at scheduled times. Any trips given during the boost schedule guaranteed drivers a specific match based on the going surge. If surge pricing exceeded this boost, the driver will receive the higher rate. Moreover, matching drivers with the closest client and changing this to another client again would guarantee drivers the highest of the rates, no matter whether this was a boost or surge pricing.      

In the past 3-4 weeks, boost earnings have decreased to the lowest levels. One week, a driver completed trips that earned them a few hundred in boost earnings. However, this boost recently earned the driver only $15. Uber has lowered this boost to as low as 1.1x during time slots that once guaranteed 1.8x. They also stopped holding expanded boost earnings on Sundays in busy regions that once guaranteed a boost from 8am-10pm. So now, only 5pm-10pm is available instead of 8am-10pm.

Uber is manipulating this boost, which is impacting earnings. This action is clearly wiping out any opportunities to make good fares. When a long trip finally arrives for a potential boost payoff, it is far below the past boost rates. Instead of 1.8x, the driver receives 1.1x. For a $100 trip, a driver stands to lose $70 in extra payments. There have been more 1.1x boosts than 1.2x-2.0x boost schedules. These boost earnings are available in different regions throughout the San Francisco Bay Area.

However, the low boost earnings make driving out in the Bay Area no longer profitable. Of course, drivers are motivated and inspired to drive their clients. They also have to make a living, especially as the high cost to operate as a ridesharing driver is quite expense. Ridesharing speciality insurance, fuel cost, car payments/leasing, repairs, maintenance, food, snacks, waters, supplies, tolls, car washes, and other expenses drag down profit. After deducting these expenses, there are not much money left to survive.

Playing around with the boost schedule has impacted overall earnings. Recently, Uber increased South Bay earnings 20 percent. They still haven't restored East Bay earnings back up to their previous rates. Completing trips within the East Bay is unappealing because such rides pay small fares. On the opposing side, drivers can/will make better earnings driving in San Francisco and the North Bay. However, all drivers servicing San Francisco must possess a business permit. The cost of this permit exceeded $100. San Jose Airport also requires a business permit. Two specific locations increase cost and this cuts into the overall earnings. It is easy for drivers to get burnt out trying to restore lost earnings.

The boost schedule continues to drop. There are times that no longer fall between the usual schedule. Moreover, drivers operating under UberEats are not receiving delivery requests during the guaranteed surge pricing: 11am-2am and 5pm-9pm. One driver drove between 5pm-9pm and only received 1 delivery request. What is the reason a driver won't receive delivery requests to help them increase their weekly earnings? They deserve to make this extra money, but Uber's platform is somehow connecting with them UberX and UberPool trips that remove them far away from delivery regions.

So much manipulation is going on that this is costing drivers decent earnings. Uber won't share destinations with drivers, so a driver may retrieve a rider that needs to travel a few hours away. Imagine traveling into the mountains and driving in a rain storm with excessive fog and wind at the waning hours of the night. It is not easy to make pickups because busy times restrict drivers from taking restroom breaks and getting gas. If drivers were at least warned that a trip may take them further than 20 miles away, they can visit a gas station to fill-up. Delaying fuel and restroom breaks could put drivers in uncomfortable positions. Most clients view special requests as unprofessional. They believe drivers are supposed to be ready at all times.

Boost earnings are losing their luster. Uber saved a ton of money ending the guaranteed hourly matches. They unveiled this boost to give drivers a boost in earnings. However, their 1.1x boost during weekend nights make servicing these busy regions not worth the time. These drivers may as well service Walnut Creek, Dublin, Concord, and other regions, which actually feature high surges rather than wait around Berkeley, Oakland and Alameda for ride requests. On Sunday evenings, ride requests in the intermediate East Bay are tough to find and this concerns many drives trying to accomplish trip milestones.

Uber drivers are slipping in their earnings. Although there is a 120 trip bonus intact, this is super challenging to reach. Drivers must average at least 2 trips per hour and work 60 hours in a week to reach this bonus. If it is busy, drivers make reach this bonus in 50 hours. Uber removed the 100 and 80 trip bonuses, while maintaining 50 trips and featuring a new 20 trip bonus. Before making these revisions, Uber kept changing the 80 trip bonus to 90 trips. This move impacted drivers trying to reach 80 trips. But now, drivers faced missing the 90 trip bonus by a few trips and that would only qualify them to reach the 50 trip bonus. It appears Uber is moving toward the 120 trip bonus to eliminate most drivers from trip milestones and awarding those who work the most hours with a $500 bonus. There is no middle ground, where drivers can reach the 80 and 100 trip bonuses and still make $225 and $350, respectively. It's now one or the other. Drivers either accomplish the 120 trip bonus, or reach the 50 and 20 trips. If they miss 120 trips, they lose plenty of money.

Slow evenings on weekend nights make driving Uber unprofitable. Drivers were once able to complete 20-40 trips on Friday and Saturday nights. Nonetheless, a reduction in ride business and possible technical difficulties undermine weekly goals. Some drivers are going 90 minutes without a ride request. It has happened enough to be concerned how the system is making connections. Delivery requests don't arrive at the right time, so drivers are missing guaranteed surge pricing attached to high peak delivery times. Clients request, cancel, request and cancel at alarming rates. They input wrong addresses, don't answer phone calls and text messages and wait to inform drivers they are at another location. We believe these clients already know they inputed the wrong address and shift this blame to drivers and Uber.

Our best advice is to make adjustments. Drive at times where ride requests are plentiful. If Sunday night is beginning to create tension since ride requests are scarce, quit working on this night. Increase hours during the week, and move toward avoiding weekends. Weekend nights are not worth the time and effort without guaranteed hourly earnings. The boost schedule constantly changes, without having any consistency. If you compare the boost from the launch to now, there is a significant change in earnings. 1.1x is most popular, which only gives a driver 10% increase in overall fare price. On past weekend nights, the boost hovered around 1.5x-2.0x. Multiple hours are missing from this new boost schedule. Clients have been known to request trips multiple times before finally agreeing to accept trips after the boost scheduled has ended. The problem with this behavior is that new trips won't qualify for the boost unless this ride is secured ahead of the boost cutoff time.

Uber, we have a problem. What is going on with changing trip milestones and boost schedules? Drivers face important decisions to scale back their hours and work toward finding a real job. Unless Uber returns the allure of making good earnings, the cost to operate is far too much and not worth the time and risk involved with bad road conditions, rain, fog, speeding drivers, stop light runners, and other dangers that exist. Restore the boost to its previous schedule. Give drivers access to the 80 trip bonus again. If a driver misses the 120 trip bonus by 1 ride, they will lost approximately $310. If you have 80 trips added in this mix, then a driver will still have a shot to fallback on the 80 trip bonus. 50 and 120 trip milestones are far apart. Missing 120 could severely impact weekly earnings. Work with your dedicated drivers to give them access to better earnings and boosts. In the past month, trip milestones and the boost schedule have been revamped enough to cost drivers valuable earnings they need to survive.