Lyft is launching driver rewards because it and Uber can’t stop copying each other (UBER, LYFT)
Category : entrepreneur
- Uber and Lyft’s recent product updates have all been eerily similar.
- On Thursday, Lyft announced a driver rewards program not unlike the one Uber launched last year.
- Last month, Lyft redesigned its app to include public transit and bike rentals, only to be followed by Uber just two days later.
- The two companies’ stock prices have also fallen in-step, hitting record lows this week.
- Visit Business Insider’s homepage for more stories.
Lyft is launching a rewards program for drivers, the company announced Thursday, continuing a trend of similarity between ride-hailing’s two dominant players.
Drivers will earn points for every dollar earned during busy hours, Lyft said in a blog post, that can then be redeemed for ride credits on the app. Those points will also unlock increasing tiers of rewards — silver, gold, and platinum — which come with increasing benefits, like cash bonuses at Gold and Platinum, discounts on tax services, roadside assistance, and AT&T cell-phone plans.
The program will only be available in 11 cities to begin with, before expanding nationwide. (There’s no word on that timeline yet.) Notably, New York and San Francisco, two of the country’s busiest ride-hailing markets, aren’t on the list.
“Our new inclusive loyalty program, which aims to provide Lyft drivers with a new, simplified way to increase take home pay and improve their experiences on the road,” Lyft said.
Uber, Lyft’s much larger competitor, launched a similar rewards program back in November. Uber Pro has since expanded to 30 cities, and includes Uber Eats couriers too. Like Lyft’s new program, Uber Pro includes discounts on fuel, vehicle maintenance, roadside assistance, and other perks.
For both companies, a robust rewards program can help sway drivers to pick one platform over the other. After all, both services are incredibly similar for both drivers and riders.
“If we fail to cost-effectively attract and retain qualified drivers, or to increase utilization of our platform by existing drivers, our business, financial condition and results of operations could be harmed,” Lyft warned in its IPO filing earlier this year. Uber made a similar warning in its S-1.
A trend of eerily similar product announcements
Rewards aren’t the first time Uber and Lyft have made product announcement at almost the same time.
In late September, Lyft announced it would integrate bike, scooter, and public transit options into its core app as part of a major redesign. Not to be outdone, Uber announced similar plans just two days later, with the goal of becoming “the operating system of your life.”
Read more: Uber is rolling out a new safety feature to make sure riders get in the correct car after the shocking murder of a college student
Safety updates have also come at remarkably similar times, as both companies face a slew of scary attacks on both drivers and riders. Lyft in September said it would require safety training for all of its drivers, while Uber announced a new PIN-based system for connected riders to the correct drivers at its event last week.
The new features are likely to continue, as Uber and Lyft wean riders off the coupons and ride discounts that they previously relied on to keep growing. Now, it all comes down to having a better product and service.
“Our commitment to supporting local operations and delivering best-in-class support for drivers is an increasing competitive differentiator,” Brian Roberts, Lyft’s chief financial officer, told investors in August.
Here’s the list of cities where Lyft Rewards is launching: Nashville, Boston, Chicago, Washington DC, Denver, Minneapolis-St. Paul, New Orleans, Philadelphia, Pittsburgh, Austin and New Jersey
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