The cost of loyalty | Hacker News Reader

The cost of loyalty

avc.com

53 pointshkmurakami15 comments

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."

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.

> 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?

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.

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.

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.

They're different communities, with different standards.

I took a Lyft recently from a driver who had an excellent rating. He happened to also be an UberX driver and confessed he had almost been kicked out of Uber because he was getting bad ratings. All his feedback was along the lines of "driver is too chatty, tries to make unnecessary conversation". With Lyft, the whole point is that your driver is friendly and makes conversation.

Uber drivers seem to be strongly encouraged to offer water and gum where only the occasional Lyft will have either.

There are a couple other small differences but yes, drivers and passengers select which community they want to be a part of. Depending on which aspects of each you prefer, the qualities definitely differ.

Was the percentage of rides available within an ETA not a reference to quality in some "way, shape, or form?"

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?

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.

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.

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.

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.

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.

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

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