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Uber customers more likely to accept surge pricing on a low battery
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May 20, 2016, 07:29 PM
 
Uber users are more likely to agree to pay surge pricing for the ride-hailing service, if they are low on battery, according to company research. In a discussion about the "dynamic pricing" of its services, the company's head of economic research, Keith Chen, revealed that a user with a smartphone that has an almost empty battery is prepared to pay more for the ride than someone with more battery life available to them.


Speaking to NPR, Chen revealed the company does know how much battery the user's smartphone has remaining, so it can switch to a power-saving mode. Despite knowing this information, Uber does not use it to artificially raise prices based on the user's individual need, with Chen assuring that it Uber has no interest in using this data to squeeze higher fees out from their customers.

Aside from smartphone usage, Uber has also worked out how to price its service to be more attractive to customers, during surges. Chen notes that customers are more likely to agree to an Uber ride when the surge level is at 2.1 times normal, as opposed to twice the usual fare. Chen suggests it may be because customers perceive a round multiplier as one arbitrarily set by the company to get more for an event, but at 2.1 it is seen as one set by an algorithm, despite pricing being worked out algorithmically in both case.
     
   
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