Uber Announces New Dynamic Surge Pricing Maps
Uber has been experimenting with the surge pricing maps for the last month or two. Some markets were test markets for the new surge maps so drivers in certain markets have the new type of surge pricing but many markets still have the older surge pricing zones. The new surge map eliminates specific surge zones and applies a gradient of surge pricing over a certain area.
The new maps are similar to what Lyft did last year when they implemented Heat Maps. Uber is playing a bit of catch-up to Lyft on this feature, even though Uber’s Surge Pricing is arguably more complex as Lyft’s Prime Time pricing.
Here are some pros and cons of the new map:
Pros:
- Surge rides may have a higher multiple, especially if you are near the peak of the surge pricing map
- You may get a surged ride, even though you may be a distance away from the peak hot zone, such as a stadium or concert hall
- The peak surge zone may move (still at a few minute intervals) so you may get a higher surged ride than if it was based on zones.
- It better represents the demand in real time, so you are less likely to complain about sitting in a surge zone but no requests.
Cons:
- Unless you are right at the peak of the surge map for a given area, your ride may have less surge than if it was based on zones
Just because I only listed one con for the new dynamic maps doesn’t mean that these new maps are better. I believe it will be worst for some, and better for others. The surge pricing portion of your earnings will be in flux a bit more than before. This surge pricing model has been in effect for some time, but instead of pricing, the number of requests changes as you are further from the “hot zone.” Everyone in the zone is under the same surge, but more requests will come from the “hot zones” (depicted in the above picture). If you are too far from it, you are less likely to get requests. Due to the number of drivers on the road, I don’t often get surges anymore, even if I am sitting in the middle of a surge zone. Maybe these maps will clear up the confusion around surge pricing and can better represent the actual demand.
What do you guys think about the new dynamic pricing on Uber? Is it better or worst than the surge zones?
Below is the official email from Uber:
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