Yesterday I signed up for Uber, I am not an early adopter of things these days as I am just too busy to jump on the next craze. I like to see what is happening in the field, see who is excited and why, and then make decision. My biggest problem with Uber was that it is being pimped the heck out of by every man and his dog, and rightly so, it is a great thing to pimp Uber, because they give you a referral credit for your troubles that makes it very attractive.
I’ve not heard a bad thing about Uber. Actually for a while I thought it was a teleportation device that had been linked to your iPhone that magically lifted you out of one touristy, over priced Irish Pub in Manhattan into the street near your hotel, depositing you neatly around the pile of vomit and dog pee and onto the red carpet of ‘home’.
My biggest peeve in traveling is being screwed over by locals
I hate it, going to a new town, getting into an unmetered cab and being screwed over. Even in my neighborhood of Brooklyn I would avoid taking Black Cars because if you don’t know what you are doing they will mark up your fare, as soon as you say ‘how much?’ you are dead to them. So when I see a new service that allows me to avoid these black cars, the first thing I ask is: “Excuse me kind sir, are you about to screw me over on the price?”
In Ubers case, the answer is yes.
If I use a car service in Brooklyn, the rate from my Mansion in Brooklyn to JFK is $35 (a $5 -$7 tip is gratefully accepted too btw) and for that you are getting exactly the same thing that Uber is providing, you get a person who has their own vehicle, either a nice SUV or a nice town car (I use nice kindly here, sometimes they are a little older, but more than acceptable for the ride) but when I quote the same price on Uber, the range starts at $46 and ‘UP’ so even best case where I get the cheapest possible option, we are looking at 31% markup. And that is BEST case.
You cannot allow the company to set the benchmark
When you evaluate any service, you can’t just accept the price being offered by the company, you have to compare it to the actual rates on offer, and if you don’t know the actual rates on offer you have to find a company that you can trust to do that for you, this isn’t that company. I’m not sure of their cut, but with inflated prices like this, I reckon it is pretty generous.
Oh and I love tipping!
I find it really sad that the Uber website tells me I have no need to tip my driver, as a person who grew up on Tips to pay my way around the world, I really find that is such and important part of service:
Oh wait, I do have to tip, and you decide in advance it should be 20% I see. Phew. This amount can be adjusted, but I think it is a little deceptive to imply you don’t have to tip, when the reason is because you already have a default tip added to your fare!
Taxi’s are everywhere
Another I hear from these teleporting bloggers is that it is just so easy to get an Uber car in NYC. If you can’t get a cab in Manhattan you should go back to Oz Dorothy, because it is hardly rocket science, sure in the pouring rain it may be a little harder to find one, so have another drink wherever you are and head to the next party 15 minutes late, by which time a regular car service arrives – there is nothing less cool than turning up promptly, using Uber, and far more sober than you could be.
Borough Taxi’s are here
Finally, those living in the other boroughs there have been 6000 NYC Taxi licenses issued, these new cars look like the regular NYC taxi other than are green in color, so there is no need to haggle for prices with the town car drivers, and all is well.
I’m disappointed
How can you be a savvy traveler and rely on a service that charges 31% above the market? Oh, that’s right, by using your Uber Credits instead! Here’s my link!!! https://uber.com/invite/ubersaverocity you get $20 to sign up and you get a further $40 off your first ride if you enter this code: C2E2 You don’t have to use my link (which gives me a $20 credit) but if you don’t, I will have to take the bus with the poor people when I next fly Business Class, and that would be a sad thing.
After that first ride, you are going to have find friends and family to signup too, or you will have to walk. It’s a bit like ‘The Ring’ if you can’t pass on your code and get freebies you might aswell give up on life.
Conclusion
So at the end of my impartial analysis I have determined that Uber is a wonderfully innovative company that offers a service that is over market price in order to take away the fear of actually asking a car service to pick you up using a telephone. No different from something like a Seamless or GrubHub service (other than the price markup). It’s clear if you go to a new town and don’t know the ‘market rate’ you could well get screwed over by an unmetered taxi, or you could use Uber and pay a similarly poor rate from the convenience of your phone (but without having to talk into your phone).
Why the hype? From bloggers I imagine because they want your $20 referral fee (I know I do!) from other people, probably a lack of social skills and understanding of market prices.
Uber isn’t meant to be a cheap service, the cheapest mode of transportation.
It takes underutilized slack resources- vehicle downtime – and deploys it productively. That’s great for the drivers who increase their income, and it’s great for people they can match rides up to.
It’s an on-demand service, you can see what vehicles are in your area, when you get paired up with one you watch it approach on your app. You know the vehicle and the driver and there’s no cash transaction.
You like to tip instead of having the tip included, great. You like to show up somewhere late and drunk. (“there is nothing less cool than turning up promptly, using Uber, and far more sober than you could be”) Great.
And your test of using it at home vs. the road? And comparing pricing without tip vs a loaded Uber price including tip? Hardly the best test.
I use it in the rain or other inclement weather. Let’s even look at New York. I use it during shift change. I use it when I don’t think a taxi is going to want to take me where I need to go. I use it in cities where I can’t just step outside and get a cab. And when I land at DCA and there’s a long line for cabs, I’ll wait 3-5 minutes for an uber driver instead of 20-30 for a taxi… a cab costs $25 to my house, a Black car from uber $30, uberX is less. I can metro but at off hours and changing trains that’s an hour of transit rather than 10-15 minutes.
I also like it on longer drives, too, where it gives me the space to flip on my wireless internet, open my laptop, and get work done much more easily than I could in a cab.
Personal circumstances. Uber isn’t for everyone, at all times. Uber isn’t the cheapest method of transportation. But it’s one of the easiest, and it’s fairly priced for what it is.
See, not everyone with different tastes than you is evil or stupid. That someone loves a service that doesn’t work out great for you doesn’t make their motives suspect.
My advice (which I don’t always follow, but try to remember to and wish I did): Always try to consider the strongest argument of those who disagree with you, not the weakest.
Gary,
Glad that is working out for you.
You seem bothered that my approach used it from home vs on the road, but the entire point is that without local knowledge of rates you don’t know how much you are being screwed over on the fare. I see no talk of value when people talk of these services, and it is critically important to understand the value of the service and not get wrapped up in the referral fee.
Am I alone in thinking that Uber, with its $20 kickback is being talked about by a disproportionately large amount of bloggers? Are they all scumbags, hell no, they are lovely people, but they aren’t sharing insights about the value and costs of this service, and my doing so isn’t a bad thing. We need balance in a world that has too many people only looking at the positives, and all of them happening to receive a credit for doing so.
I strongly dislike the auto-tip, I said the same with the CSP app too, it really annoys me that tip control can be taken out of the equation, it loses sight of controlling your finances and is a bad thing.
Always love you coming around here to leave some insights though, and I didn’t say you were being evil.
They aren’t talked about much when the offer is simply $20 (most often it has been $10) for the referred and $20 ($10) for the person being referred.
They are talked about a lot when there are much bigger offers like $10/$20 + $40 for the person signing up (and $10/20 for the person referring).
Because it’s a really great deal, $60 in free travel for a few clicks and an app download.
It’s not free forever, and it doesn’t make sense to use in every and all circumstances. But I write about 1000 Delta miles for signing up for a Skymiles account, and ~ 1000 AA miles for a Facebook game that takes a lot longer. And this is a better deal.
Are there people writing about these offers because it benefits them to do so? Probably, though I’d be reluctant to speculate since I don’t claim to know others’ minds, just the quality of the offers and analysis they put forward.
My point is simply that not everyone who disagrees with you is taking their position for nefarious reasons, and it seemed like the tenor of your post suggested otherwise. Re-reading it, it still comes across that way, and seems like you’re arguing against a straw man.
What I would have liked more is a post framed somewhat differently.
“Uber is great when it’s free, you shouldn’t sign up when there’s a $10 or $20 offer unless you have an immediate need to use the service since there’s also frequently $45 – $60 on offer if you wait.
When Uber isn’t free you need to compare it to other alternatives to know whether it works for you. That could be public transit, cabs, or local car services. I find that the service I use gets me to JFK cheaper than the cheapest Uber option.
I also prefer to tip what I want, and carry cash or include it in an electronic transaction, have have the tip amount pre-determined while avoiding the time and hassle of a transaction at the end of the ride.
Your travel style, and good analysis of your options will tell you what’s best for you.. especially once you have used your free credit.”
I would agree with that analysis 100%. 🙂
Ha – OK you can now ghostwrite all my posts!
I see your point, but every now and then I think we need to focus on the things that may seem overlooked. Clearly, the referral credit (just like a credit card signup bonus) is created to build a customer relationship. And also clearly, if these things didn’t provide a substantial ROI then they wouldn’t be used.
With no real talk of the negative side of Uber (the cost is quite a serious consideration of any service) I think that it is more likely that people will become customers without fully evaluating the value of the service.
If you do know that it costs more, and are happy to pay for convenience then I think that is an educated and informed decision, and it may be one that changes due to circumstance, but with little (I saw none, but I don’t really read other blogs that much) talk of the downside I think the promotion of Uber is a disservice to a reader.
Now it’s my turn to agree with you. I think a better blog is one that does more than list deals with no analysis, or without any critical analysis. I’m far from perfect (goodness knows I write enough posts that they can’t all be any good). But I generally try to say at least something like ‘Uber is usually 50% more than a cab’. I don’t want there to be any illusions. And then often link to a past post where I explain why I like Uber so much, but in the context of how the taxi market work, what Uber’s business model is, etc. Hopefully that’s value-add, or at least readers who find my style of content useful will be the ones most likely to return.
Are there posts that are overly pitchy out there? No doubt. And you know what? Call them out. “Name names.” Rather than speaking in generalities, maybe I’m alone in this but I don’t have a problem calling out bad advice and I’ve done it on more than one occasion without pulling punches. As a result turnabout is fair play — if you think I’m off base, or doing my readers a disservice, nothing wrong with linking to the specific post and saying so.
(That said, I’ll usually aim up rather than down, and many minor and less-trafficked blogs won’t get called out by me.)
Ultimately I suspect that with regard to Uber, we just have different travel styles. Last week I was at the Hyatt Chicago Magnificent Mile and it was raining during rush hour. I could have taken the train out to the airport (leave today’s tragedy out of the equation) but I needed to get work done during the commute. I wouldn’t have gotten a cab. I got an Uber Black. The cost out to the airport was probably 30% more than a cab would have been, but a cab wasn’t an option and I got important deadlines met that I wouldn’t have otherwise.
One of the great things about different travel blogs is that they speak to different styles. Disagreements may turn on bad motives, or simply on different preferences, and I think it helps to link to an example if calling out motives, or recognize where differences may be driven more by perspective than motive.
Best,
Gary
In addition to all the points discussed above, I’ll add this – there could be some sort of unintentional bias due to the different cities. What I mean by that is, I was in DC this past weekend, and I was using Uber a lot. In DC, Uber is cheaper than a taxi, and you get better service. As I was using Uber more and more in DC, I was thinking to myself how terrific it was.
I never get that feeling when I’m back home in NYC. When I have used Uber in NYC, it’s mostly from free credits since I would always choose a taxi or prearranged car service over Uber, and the whole time I’m riding in the car I’m thinking how bad the pricing is.
I don’t know if the fact that Gary lives in DC and we live in NYC has anything to do with our divergent feelings towards Uber but if I was living in DC, I feel like I would personally be raving about Uber a lot more.
Do you pay Über out of your own pocket?
Interesting discussion and I think both sides have good points. This post seems the be the first I remember seeing that points out some of the negatives about the Uber service. I personally hate preset tips because I want to be able to tip well if the service is good and most importantly tip less or not at all if the service is horrible.
Matt, I really appreciate your analysis from a different angle as it is sometimes hard to include negative information about a product when you want people to sign up and use a referral link for financial reasons.
Thanks for the comment, I think a little balance and friendly debate are a good thing for the consumer, and glad you appreciated them too.
Thank you Matt for imparting some sanity to these endless Uber promotions on travel blogs. Obviously, Gary’s blog has been the most shameless, which is why he’s come to defend himself.
I’ve used Uber in the past and found it to be a good service, but it is way overpriced. It is useful as Gary states in areas where transportation is challenging, but so are Lyft, ZipCar, etc and none of those get mentioned precisely because they don’t have a referral credit (Lyft even has a good promotion going).
So, I think you’ve highlighted again how incentives influence a blog’s content. This is becoming more evident with relatively lackluster credit card offers and other items receiving an undue amount of coverage simply so the blogger can earn money. Very often, a proper analysis seems intentionally excluded.
Thank you for avoiding this; that’s a reason I love this blog so much.
Thanks Steve, though I personally don’t find Gary’s work objectionable. I actually wrote this because my twitter feed was being over-run with uber $60 excitement, I think he is one of the better bloggers out there both in terms of content, and I don’t really think he is in it for the $20 when it comes to Uber.
For what it’s worth, I’ve got a soft spot for disruptive innovation and those that read my blog closely know that’s especially true for entrepreneurs who run headlong into regulators 😉
And thanks for the kind words and useful discussion, Matt. I do agree that the service isn’t for everyone (especially after the free credit is used) and a balanced discussion of that is useful.
Interesting exchange. I had really been wishing we had Uber here in PDX as another way to get to and from the airport and now I see that I really am not missing much. I might use Uber while traveling if I had a bunch of travel credits, but probably not as a regular thing. But as you both say, everyone has different needs and values travel costs and convenience differently.
Personally, I enjoy Matt’s sarcasm and the detailed analysis of Uber as a value proposition. I doubt very much if Matt really does “like to show up somewhere late and drunk.” And least not too often 😉 !
I’m glad someone gets that aspect of it!
Has anyone pointed out to Matt yet that the Uber auto tip function is only for their taxi service (as noted in his own screenshot), not for UberX which is the one he’s comparing his Brookyn car service too? The tip for UberX is in fact included in the price, not added.
If you enjoy tipping, then I suppose that’s great and UberX isn’t for you. Personally I think deciding on a tip is about as pleasurable as negotiating a car price. See Mr. Pink’s excellent discussion of tipping for more, and also note there’s a good reason tipping isn’t customary in many other countries.
I saw that- but does that mean the person goes untipped for the service? Tipping anyone is voluntary if you want to get technical…
Would love to see behind the curtain on that inflated price they charge to see how much they keep.
Yes, for UberX the driver goes untipped unless you hand them cash (or they refuse to take your cash tip, which is what happened when I tried to tip my recent UberX driver). Also, no reason to believe Uber’s driver deal is some big secret — according to this month’s article in GQ about Uber (excellent read if you’re interested), the standard driver deal is that Uber takes roughly 20% of the fare and the driver gets the rest. My recent Uber driver told me he much preferred working for Uber than a regular car service because he made more money and could control his work hours, so obviously he was not at all bothered by not getting a tip.
I may sound like some sort of Uber cheerleader, but I’m not. I’ve only taken them once and it was a perfectly fine experience, but I don’t have a great need for car services so I probably won’t use them very often. However, given what a big deal you made in your post about the so called auto tip and a 31% premium and all that jazz — none of which is accurate if you really do an apples to apples comparison — it seems a correction or update of this post would be in order, don’t you think?
And quite frankly, if you don’t believe in Uber, then why on earth are you providing a referral link in the middle of your post? Why would you refer your readers to a service you believe is overpriced?
Well, I hate autotip for many reasons way beyond uber, I recently trialled a secret squirrel app from Chase that did the same, added on 25% to my lunch tab. Not good for the consumer at all.
As for the 31% yeah maybe I could change the post, but if you consider that was the lowest price possible even if I adjust they still are coming in at over 15% more on the low end, and way more on the high end.
As for the link, it amuses me because I have a twisted sense of humor.
Sorry man but you won’t get any referrals from me……Tried to use it in Lyon last June after bloggers claimed it was better than sex…….waited 5 minutes on the curb and tried to call them and it never happened……gladly got in a cab that was, well right in front of me……and I’m sure ws quite regulated as the French love to do….then more blogger raving so I went on the SF website to get a fare quote and the hourglass just spun around and around in a perpetual motion of a young company whose sales pitch is greater than its’ logistical tail……so I emailed customer service asking for a fare quote…..no reply…………the best way to kill a product is with great advertising so I think it is a matter of time…….in the meantime I just snagged a couple of Groupon limo rides and I am all set thank you!
And Matt thank you for pointing out the difference in shit and shinola to a retired Army officer……I do believe you have mastered that in this post!
I loved Uber when it was free… i.e. while I had about $50 of signup credits. I’d still use it in weird situations where it’s hard to get a cab… accidentally going to the Field Museum during the Packers – Bears game, for example. I’ve found that it’s a very good service for a substantially higher price than a cab. Something I’ll keep in my arsenal, but couldn’t justify using frequently. I’ve got to say, though, as a person who doesn’t live in a city and doesn’t travel often enough to be savvy about such things…. I’d never know what local car service to phone up if I wanted a town car or SUV to take me somewhere.
This was a very useful post, though, pointing out what a lucrative referral bonus there is. I certainly wish I could use this service for free.
Oh, and I did find that the post – with link – was funny. 😉
Glad you liked it! I understand your point, my real issue is that people assume they can trust it as a real alternative in situations like yours and perhaps are paying over the odds for that.
Once people know about the premium and still select the service then I think that’s a fine decision.