Uber is an advantageous service for anyone that lives in a major metropolitan city. Everyone has been there; downpour, no cabs, need to get to x as soon as possible. And as it turns out there actually is a reason beyond perception that there seems to be a lack of cabs during periods of high demand. Behavioral economists have concluded at least part of the reason for the seemingly irrational mismatch of supply with taxis in periods of high demand is that cab drivers hit their target daily income quicker and in turn cut their days shorter. It doesn't just seem that there are less cabs, there actually are less cabs.
Uber (and recently launched Groundlink ) through both apps and SMS allow you to request a blackcar to your current location and automatically be billed to your credit card. "Uber takes GPS data from your ride and charges for distance or time depending on your speed. When your Uber is traveling over 11mph, we charge a distance fee. When your Uber is traveling at or below 11mph, we charge a time fee."
Problem solved? Mostly. Anyone that has been through Halloween in New York City has a seen a few things that are indelibly imprinted in their brain and has also experienced how painful of an experience moving around is. Like a diet New Years Eve, people seem to come out of the woodwork, jam the streets and take every cab imaginable. Uber is attempting to solve this issue on Saturday night.
Uber will be using "Surge Pricing" from the hours of 7 PM on Saturday 10/29 to 3 AM. The company will use real time analytics to measure customer demand with pricing increasing up to 2x at points of high demand. Their goal is "more drivers will come out and stay on Uber with higher prices and [they] keep those cars full by adapting to changes in demand throughout the night."
Ultimately its a variable pricing model that uses real time analytics, allowing for (hopefully) an evening out of supply and demand. A really smart usage of data if done properly and not simply turned on for all 8 hours.
Uber should walk away from Saturday night with a. more satisfied customers b. more money c. more information about their users spending habits. Look for this to not just become an isolated Halloween occurrence but instead expand to include various situations, from bar closings to weather issues all with the added benefit of more data for the company to mine.
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