How Uber Use Behavioural Economics

April 3, 2017 in Daily Bulletin

Noam Scheiber wrote about the use of behavioural economics by Uber and its peers:

  • Uber borrowed a trick from Netflix where the next trip will queue up before the previous trip ends to encourage drivers to stay on the road.
  • Similar to Netflix this means that it requires more effort to stop binge driving than to continue it.
  • Male managers trying to direct drivers to areas of high potential demand sometimes pretend to be female, as drivers are more likely to listen.
  • Humans tend to set goals and if a driver tries to sign off the app may display a message encouraging them to continue driving because they’re just “$10 away from making $330 in net earnings”.
  • Uber awards Xbox like badges for accomplishments such as good customer service. They’re free for Uber to hand out, but anecdotal evidence indicates that they can be a big motivator.
  • In the future Uber could use personalized targeting. If a driver receives consecutive bad reviews after a long shift they may encourage the driver to go home.

Read more about some of the other tactics used on The New York Times.