Strategy behind Uber’s Higher Take Rate

WSJ article on Uber’s take rate from this week:

Uber Tests 30% Fee, Its Highest Yet: Company now charges some drivers 30% of fares in San Francisco and San Diego

via Uber Tests 30% Fee, Its Highest Yet – WSJ.

The reality is that this is a move to dis-incentivize drivers from multi-homing, or driving for multiple networks.  Think of it like a loyalty program that all drivers are automatically enrolled in.  After a certain mileage hurdle, Uber’s take rate goes down, so there’s more incentive to stick with Uber even if Lyft may provide more immediate revenue.

 

 

 

Advertisements