How Not to Get Tricked by Uber and Lyft Driver Incentives
There are many driver incentives for Uber and Lyft. There are bonuses to encourage new drivers to sign up. There are other incentives to entice dormant drivers to give a few rides during times of high demand. Here are just a few examples of driver incentives:
- Sign Up Bonuses
- Hourly Guarantees
- Boost Pricing (Uber)
- Trip Bonuses
Not everyone is eligible for all of these bonuses. For example, drivers who participate in Lyft’s rental program are not eligible for a driver referral bonus, but may be eligible for a signup bonus directly from Lyft. In addition, hourly guarantees, boost pricing and trip bonuses are typically targeted to certain drivers. It is common for full time drivers to be excluded for some of these bonuses.
New Years Eve is a busy time for rideshare. Many passengers are out drinking and use Lyft and Uber to get around the city. In Seattle, Uber had this spectacular incentive where if you give 12 rides between 10pm-3am, you will be guaranteed $325. That is about $28 per ride and this was commission free, so that is take home pay. This seemed too good to be true and it was. Almost all drivers I spoke to couldn’t get 12 rides. Only one driver I spoke to was able to get 12 trips and he got his last trip around 2:52am. One driver noted that he saw some drivers who typically work down at the airport but came up to the city to try to get 12 rides. I attempted to get an Uber ride starting at 10pm and only got one just before 11pm so I switched back to Lyft. I lost out on some money for the 10pm hour from the Lyft guarantee but other drivers stuck with it until 3am and that was when they found out they wouldn’t get the bonus. These Uber drivers lost out on hundreds of dollars.
Another example of drivers being tricked by a bonus are signup bonuses. There have been some very large Lyft signup bonuses that also required many trips. The largest one was 1000 trips in 90 days for $5000 bonus in addition to your ride earnings. From the start, I knew that this would be very difficult to achieve, but there were many drivers who signed up and attempted it. I made it very clear that it would be very difficult to complete. To date, I have not had one driver hit this bonus, or even the lower bonus of $2000 after 500 trips in 60 days.
It is tough for some drivers to figure out if these bonuses are achievable. However, there are some tips that will help drivers figure out which ones to go for and which ones to ignore:
Is It Possible?
For Uber’s NYE driver incentive in Seattle, it was a 12 trip requirement between 10pm-3am, which is a little over 2 trips an hour. On a normal night, this goal is possible. It may be a bit difficult if you don’t get a lot of UberPool requests. In the past, I have been able to get 3 or more trips within an hour, so 12 seems very attainable. However, the bonus was very high. The guarantee earnings for those 12 trips was $325, which means it is about $27 per trip. It seems exceptionally high, and seems a bit too good to be true.
For Lyft’s hourly guarantee, there are minimum ride requirements. I have done these in the past and have been able to meet the requirement, so I knew that I could hit it again this time, even factoring in for other drivers. I knew how to avoid other drivers and which areas would have more trip requests. Needless to say, I had some practice so I knew the Lyft guarantee was possible on New Years Eve.
Too Good To Be True
If it sounds too good to be true, then avoid it. $5000 bonus after 90 days? Yea, its just a bit too good to be true. Once you drill down into the numbers, you would need to give 12 trips a day for 90 days. It means you would need to drive 4-6 hours a day for 90 days. As an experienced driver, I know that doing this for three months would be very tiring. I know some people who average 70 hours a week on Lyft/Uber, but this is the minority. This is why I recommend drivers to wait for a lower signup bonus. Lower signup bonus has a lower ride requirement and it is much easier to achieve. Typically, 100 rides is a tough requirement to hit within 30 days, so 500 in 60 days would be very difficult. It goes back to the question of whether it was possible for you to hit the ride requirement.
For Uber’s NYE driver incentive, the $325 in guarantee earnings (take home, commission free) seemed a bit too good to be true. Since it was so generous, I knew that the competition would have an effect on whether or not I could get the guarantee from Uber on NYE. If there weren’t many drivers out, 12 trips would be easy. However, since the Uber NYE guarantee was so good, I knew many drivers would be out on the road, which will affect how many trips I can get that night.
The competition is other drivers. The higher the bonus, the more drivers will attempt it. You will need to figure out if there is enough demand to support the guarantee. Most experience drivers have a sense of if these various driver incentives are achievable on the demand side, but many drivers do not. The only way to be sure is to try it for a short period of time and do the math. So for the New Years Eve bonus (12 trips between 10pm-3am on NYE), I knew I needed more than 2 trips an hour. When I struggled to get 1 in the first hour, I quickly realized it would be impossible to hit 12 by 3am so I switched back to Lyft.
I also knew that the competition (other drivers) would be in the typical hot spots, like Downtown, Capitol Hill, Ballard and Fremont. My tactic was to avoid those areas completely. During the first hour, I drove right out of Capitol Hill into a less populated area and got a request within 5 minutes. In the subsequent hours, it was a bit more difficult, but I repeated a similar process and was able to get rides within the coverage area for the Lyft NYE bonus.
One way to see the competition is through the passenger application. On Uber, you can run both applications at the same time. You can be online in driver mode on Uber and have the Uber passenger application open to see other cars. On New Years Eve, I have seen worst driver saturation, but it was still very difficult for me to get a trip. On Lyft, you would need a second phone (with a separate Lyft account) to be able to view the other drivers on the passenger application and be in driver mode on Lyft.
After you analyzed the driver incentives, you need to think about whether you can physically drive and hit the above requirements. For the $5000 signup bonus, can you give 1000 trips in 90 days? It is hard to know if you can hit that trip requirement before you are a driver. This is why I mentioned that it was a very hard bonus to hit.
For the Uber NYE driver incentive, you would need to drive till 3am. There are some nights I don’t even make it to 11pm so I thought that I wouldn’t last until 3am. With Lyft’s hourly guarantee, I don’t need to drive until 3am, which provided a good safety net. If I were to attempt Uber’s NYE driver incentive, I would be forced to drive until 3am, or until I’m able to get 12 trips. I knew that it would take just before 3am to get 12 trips anyway, so there was almost no option to stop early.
There are some Lyft hourly guarantees that start at 7am. For example, they may pay out $35 an hour between 7am-9am for the morning rush. Are you able to wake up and start driving by 7am? 95% of the time, that is a no for me. There are some rare times where I can get up in time and I would guess that many drivers can’t either.
What Happens If You Are Tricked?
When you find out that the bonus is not achievable, then change tactics. Most of the time, this means not driving for either Uber or Lyft. For example on NYE, I switched from driving on Uber to exclusively drive on Lyft. If you are tricked by the signup bonus, then you can either quit driving altogether or continue to drive for them but on your own schedule because you no longer need to trip any trip requirement. You will need to figure out for yourself if it is worth it to continue driving without the signup bonus.
The key is to cut your loses. If you have a feeling you won’t be getting the signup bonus, there is no reason to continue unless you find it worthwhile to continue driving without the signup bonus.
If you feel like you are tricked, unfortunately there is no recourse from Uber or Lyft. They set the requirements and if you don’t meet those requirements, you are not eligible for the bonus payout.Have more questions about Uber or Lyft? Head on over to our Rideshare Driver Training Course!