29th Jun 2016
Uber has removed details of its surge pricing – the factor by which fares are increased during busy periods – in some Indian and US cities, and the UK may follow.
Uber’s new ‘upfront fares’ for its UberX journeys show customers the exact cost of their trip before they make their bookings. However, the new system also removes information about the surge price multiplier and the option for the customer to be notified when surge pricing in their area has ended.
“When fares go up due to increased demand, instead of surge lightning bolts and pop-up screens, riders are given the actual fare before they request their ride,” said Uber in a statement. “There’s no complicated math and no surprises: passengers can just sit back and enjoy the ride.”
However, some argue that customers have their options limited by upfront fares. “It's important to give users a choice of whether to wait,” said Jim Clark, research director at Econsultancy. “At the very least they could give users the option to switch the surge information on or off.”
The Institute of Customer Service recently published a research report – The customer of the future – that identified the importance of striking a balance between offering customers greater choice and streamlining services. “Customer behaviour is changing, and the future promises vast, exciting opportunities for new products and ways of delivering service,” says Jo Causon, the Institute’s chief executive. “Yet in a climate of expanding choice, customers will also want integrated services and simple, straightforward experiences from companies they can trust.
“The challenge will be for organisations to understand both sets of needs and be able to move seamlessly between them.”
The future of surge pricing could be affected by government plans to ban in it New Dehli, following complaints that some taxi fares in India rise by a factor of six or seven during peak periods.
Jeff Schneider, engineering lead at Uber Advanced Technologies Center, also made headlines last month when he told America’s NPR that the company were developing algorithms “so the surge pricing never even has to happen”. However, Uber later issued a statement that it had “no plans to end dynamic pricing”.