Friday, June 3, 2016

Uber, surge pricing, and how much battery life is left in your phone (they know)

The Telegraph has the (scary) story, after chatting with Keith ChenUber knows customers with dying batteries are more likely to accept surge pricing

"The car-hailing service Uber can detect when a user’s smartphone is low on battery, and therefore willing to pay more to book a ride.

Uber, which has faced the ire of London’s tax drivers since launching in the capital in 2012, can tell when its app is preparing to go into power-saving mode, although the firm says it does not use this information to pump up the price.

Keith Chen, head of economic research at Uber, told NPR that users are willing to accept a “surge price” up to 9.9 times the normal rate, particularly if their phone is about to die.

“One of the strongest predictors of whether or not you’re going to be sensitive to surge… is how much battery you have left on your cellphone,” he said.

We absolutely don’t use that to push you a higher surge price, but it’s an interesting psychological fact of human behaviour.”
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Here's a paper by Chen and Sheldon: Dynamic Pricing in a Labor Market: Surge Pricing and Flexible Work on the Uber Platform

1 comment:

Unknown said...

Isn't it strange that he says a customer could pay a price 9.9 times higher? Unless taxi fares in London are so high, it doesn't make much sense