6 ms·

The cost of loyalty

53 points by hkmurakami 12y ago

JacobAldridge 12y ago
Wow - we've gone from a disruption startup to needing a market aggregator in how long? Two years? For those who have tried the various services, how do they compare in other ways (product quality, service standards, market penetration)? Or would you buy solely on which was the best price?
- coev 12y ago
  This does vary according to location (as the article says), but I've used cabs, Uber and Lyft in SF. I prefer Uber and Lyft by far over the standard cab services. The cars and drivers are generally nicer. I don't really have a preference for Uber vs Lyft and tend to go with the cheaper/more convenient option in the moment. However, I do find that Lyft drivers are generally more social while Uber drivers will let you keep to yourself more easily, so I also book based on mood sometimes.
- lnanek2 12y ago
  Many people I know in SF left Uber because of the surge pricing for Lyft, which now added surge pricing...so from the user perspective most take the simpler decision route of just dumping the expensive one.
deleted 12y ago
[deleted]
obviouslygreen 12y ago
The unspoken premise here is that the only important thing about loyalty is how much it costs you compared to always using the least expensive service. I'd like to point out that many people (myself included) complain about phenomena like the race to the bottom in mobile app prices and the death of customer service in our airlines... but then we (myself often included) make measurements like this, with loyalty rarely considered and, when it is, often derided as simply a source of extra overhead. This post is a great example: The author happily compares these companies solely on cost, with no reference at all to quality in any way, shape, or form. There are more dimensions to goods and services than how much you pay for them, but we too often make that not only the primary metric (by a long shot) but sometimes the only metric, and that misses all sorts of points. Don't expect quality services to start and stay when your primary view of "loyalty" is its "cost."
- chongli 12y ago
  All economies run on information. Things like the race to the bottom spring out of a lack of savvy (among many other things) in the market. Consumers that buy only on price get burned repeatedly -- albeit for small amounts of money -- by bad deals. Savvy customers, on the other hand, reward past performance with repeat business. Business owners like to call this "loyalty" but it's more simply described as following a pattern. The better your track record of good products the more likely I am to take a risk on your new products. It's risk management.
- ForHackernews 12y ago
  > The author happily compares these companies solely on cost, with no reference at all to quality in any way, shape, or form. Do these ride-sharing companies even have quality metrics in any meaningful sense? Surely the quality of service you receive is a function of the individual driver-subcontractor, not of whatever mobile app you happened to hail them from?
  - obviouslygreen 12y ago
    I have no clue; I've never used them or been involved with them. I'm simply pointing out that comparison on cost without even the attempt to analyze quality is a recurring theme that encourages lower prices without consideration of any other factors.
  - pbreit 12y ago
    They obviously have all sorts of quality metrics. What exactly do you mean? Driver density, time to pick up, time to deliver, routes taken, feedback ratings, car quality, etc.
    - ForHackernews 12y ago
      Sure, but none of those metrics are dependent on the particular service in any real way. They're either a) properties of an individual car+driver or b) properties of the city/traffic situation/environment in which that driver operates.
  - 12y ago
pbreit 12y ago
I don't think it's a good idea. People don't really shop around Uber, Lyft or Sidecar. Most people make their decision to use one predominantly or exclusively. Same with drivers. People aren't going to Kayak through every $5-20 decision to save a buck. Especially when there are other important variables and brand promises. And the premise is a little insulting in that I'm supposed to feel like an idiot for having picked one provider.
wbeckler 12y ago
Same problem existed in accommodations with the rise of Airbnb and Homeaway and Booking.com, so we created http://AllTheRooms.com http://AllTheRooms.com, which has turned out great. Aggregators still make a lot of sense.
ojbyrne 12y ago
So, interesting problem (but not hugely), that as always, ends with, oh... one of our portfolio companies has the solution. I'm so tired of PR.
- davemel37 12y ago
  Calling this PR is a stretch. Other than the linking to Sidecar and not linking to Uber and Lyft, this post is no different than Warren Buffet drinking Coke during a TV interview.

53 points by hkmurakami 12y ago

Wow - we've gone from a disruption startup to needing a market aggregator in how long? Two years? For those who have tried the various services, how do they compare in other ways (product quality, service standards, market penetration)? Or would you buy solely on which was the best price?

coev 12y ago
This does vary according to location (as the article says), but I've used cabs, Uber and Lyft in SF. I prefer Uber and Lyft by far over the standard cab services. The cars and drivers are generally nicer. I don't really have a preference for Uber vs Lyft and tend to go with the cheaper/more convenient option in the moment. However, I do find that Lyft drivers are generally more social while Uber drivers will let you keep to yourself more easily, so I also book based on mood sometimes.
lnanek2 12y ago
Many people I know in SF left Uber because of the surge pricing for Lyft, which now added surge pricing...so from the user perspective most take the simpler decision route of just dumping the expensive one.

deleted 12y ago

[deleted]

obviouslygreen 12y ago

The unspoken premise here is that the only important thing about loyalty is how much it costs you compared to always using the least expensive service. I'd like to point out that many people (myself included) complain about phenomena like the race to the bottom in mobile app prices and the death of customer service in our airlines... but then we (myself often included) make measurements like this, with loyalty rarely considered and, when it is, often derided as simply a source of extra overhead. This post is a great example: The author happily compares these companies solely on cost, with no reference at all to quality in any way, shape, or form. There are more dimensions to goods and services than how much you pay for them, but we too often make that not only the primary metric (by a long shot) but sometimes the only metric, and that misses all sorts of points. Don't expect quality services to start and stay when your primary view of "loyalty" is its "cost."

chongli 12y ago
All economies run on information. Things like the race to the bottom spring out of a lack of savvy (among many other things) in the market. Consumers that buy only on price get burned repeatedly -- albeit for small amounts of money -- by bad deals. Savvy customers, on the other hand, reward past performance with repeat business. Business owners like to call this "loyalty" but it's more simply described as following a pattern. The better your track record of good products the more likely I am to take a risk on your new products. It's risk management.
ForHackernews 12y ago
> The author happily compares these companies solely on cost, with no reference at all to quality in any way, shape, or form. Do these ride-sharing companies even have quality metrics in any meaningful sense? Surely the quality of service you receive is a function of the individual driver-subcontractor, not of whatever mobile app you happened to hail them from?
- obviouslygreen 12y ago
  I have no clue; I've never used them or been involved with them. I'm simply pointing out that comparison on cost without even the attempt to analyze quality is a recurring theme that encourages lower prices without consideration of any other factors.
- pbreit 12y ago
  They obviously have all sorts of quality metrics. What exactly do you mean? Driver density, time to pick up, time to deliver, routes taken, feedback ratings, car quality, etc.
  - ForHackernews 12y ago
    Sure, but none of those metrics are dependent on the particular service in any real way. They're either a) properties of an individual car+driver or b) properties of the city/traffic situation/environment in which that driver operates.
- 12y ago

pbreit 12y ago

I don't think it's a good idea. People don't really shop around Uber, Lyft or Sidecar. Most people make their decision to use one predominantly or exclusively. Same with drivers. People aren't going to Kayak through every $5-20 decision to save a buck. Especially when there are other important variables and brand promises. And the premise is a little insulting in that I'm supposed to feel like an idiot for having picked one provider.

wbeckler 12y ago

Same problem existed in accommodations with the rise of Airbnb and Homeaway and Booking.com, so we created http://AllTheRooms.com http://AllTheRooms.com, which has turned out great. Aggregators still make a lot of sense.

ojbyrne 12y ago

So, interesting problem (but not hugely), that as always, ends with, oh... one of our portfolio companies has the solution. I'm so tired of PR.

davemel37 12y ago
Calling this PR is a stretch. Other than the linking to Sidecar and not linking to Uber and Lyft, this post is no different than Warren Buffet drinking Coke during a TV interview.