When does a company cross the line from profit-seeking to ruthless?
When does it cross the line from ruthless to treacherous?
Is ruthlessness okay in business, as in buyer beware?
Or, when you’ve shown loyalty to a business through repeated transactions, universal embrace, and favorable word of mouth, is there a contract of sorts?
You know, that that brand won’t betray your trust, or materially change the rules without full transparency.
Uber: An Amoral Company
I pose this question since, as a frequent flyer, I find myself opening the Uber app to take an Uber ride at different airports several times a month, and have done so for years.
While my behavior hasn't changed, one thing has notably changed in recent months.
Specifically, I have been shocked and disgusted by Uber’s surge pricing practices, which are clearly predatorial.
When I say predatorial, I mean that Uber is specifically “gaming” the consumer at the airport by routinely charging 2X - 4X normal pricing, trying to engineer specific consumer behaviors; namely, paying a crapload more money, knowing full well that the customer:
A) Has few options
B) Has limited mobility
C) Feels on the clock post-flight
D) May be able to pass the cost on to their employer
Case in point, I have seen repeated examples at SFO, where a fare that normally varies from $28 to $55 was $150, a #FFS (for fuck sake) number that it should be noted is 5.36X the lowest rate offered by Uber!!
Predatorial Capitalism
So, you say, well that’s how surge works. Get over it.
Sure, but that begs the question of WHAT is the catalyst for the surge.
Feeling gut-punched, I clicked in and out of the Uber fare query function, and the $150 rate quickly toggled down to $78, then, when I didn’t bite, back into $125, never getting much below $100.
But within 15-20 minutes, the price was back to a more manageable $57.
Like clockwork, I have played this cycle with Uber several times.
But, then I was at Burbank Airport the other day, a suburban, somewhat smaller municipal airport.
What would have been a $30-43 fare, was instead, $120.
For a brief moment, the app showed a $68 rate that felt unfair, so knowing the game, I passed.
For the next 35 minutes, I repeated the learnings from above, but to no avail.
A Second Chance to Make a First Impression
In my article, 'Reopening Retail: A second chance to make a first impression,' I wrote that post-pandemic, retailers and businesses of all types, having been “battle hardened” need to recognize the golden opportunity; a second chance to make a first impression.
The point being, while it's tempting to squeeze every dollar and cut every corner, in times of disruption, the consumer is at play, and will switch loyalties for those who fail to read the tea leaves.
So how has Uber approached this golden opportunity?
So, un-valuing are they of my history of customer loyalty -- thousands of rides over 10+ years -- that Uber has literally forced me to give Lyft a shot.
It's akin to Apple so antagonizing their users that they are pushed to switch to Android.
In this specific case, while Uber was trying to con me into paying $120, the same ride was $46 on Lyft.
Imagine finding that Amazon was trying to charge you 260% for the same set of headphones as at Best Buy...would you EVER trust them again?
But, here’s the kicker. The con is even worse.
For shits and giggles, I tested the pricing query a couple miles from the airport, and guess what? The most recent $110 fare had flattened to $28.
Twenty-eight frickin bucks!
The 'Bad Boy' Among the Tech Unicorns
I have some thoughts on this. One is that Uber affirms the fact that if you want to see how it Ends, look at how it Begins.
Here, the data is really clear. Uber has always been the Unicorn Bad Boy.
Engaging drivers through aggressive promotion and incentives, then callously commoditizing their work, then cannibalizing drivers with an explicit goal of putting them out of work some day.
The same drivers whose participating made the business work, ALWAYS treated like second class citizens and disposable, man-handled with all of the goodness of employees in terms of coordination and determinism without the messiness of having to actually pay benefits, let alone their fare share of taxes.
I get the easy narrative, as I am an entrepreneur myself:
- Disruption was often messy, so adolescence and aggression were to be expected.
- It was the Founder’s fault. and now he’s gone.
- Fares are higher because costs are higher.
- Surge is more prevalent because there are less Uber drivers post pandemic.
- Prices were subsidized in the past and now they aren’t anymore
- Blame the algorithms. They work TOO good.
All true, but you are what you DO.
The algorithms, are only as good, moral or amoral, as the people that create them.
I am reminded of a great analogy by Kara Swisher, one of my favorite writers and thinkers, that There Must Be a Pony in Here Somewhere (because there is so much Shit).
There are only so many excuses one can stomach for bad behavior.
You are what you DO.
