Uber launches rider loyalty Rewards like credits & upgrades 9 cities

Uber’s  new loyalty program incentivizes you not to check Lyft or the local competitor. Riders earn points for all the money they spend on Uber and Uber Eats that score them $5 credits, upgrades to nicer cars, access to premium support, and even flexible cancellations that waive the fee if they rebook within 15 minutes.

Uber Rewards launches today in nine cities before rolling out to the whole US in the next few months, with points for scooters and bikes coming soon. And as a brilliant way to get people excited about the program, it retroactively counts your last six months of Uber activity to give you perks as soon as you sign up for free for Uber Rewards. You’ll see the new Rewards bar on the homescreen of your app today if you’re in Miami, Denver, Tampa, New York, Washington, DC, Philadelphia, Atlanta, San Diego, or anywhere in New Jersey, as Uber wanted to test with a representative sample of the US.

The loyalty program ties all of the company’s different transportation and food delivery options together, encouraging customers to stick with Uber across a suite of solutions instead of treating it as interchangeable with alternatives. “As people use Uber more and more in their everyday, we wanted to find a way to reward them for choosing Uber” says Uber’s director of product for riders Nundu Janikaram. “International expansion is top of mind for us” adds Holly Ormseth, Uber Rewards’ product manager.

As for the drivers, “They absolutely get paid their full rate” Ormseth explains. “We understand that offering the benefits has a cost to Uber but we think of it as an investment” says Janakiram.

So how much Ubering earns you what perks? Let’s break it down:

In Uber Rewards you earn points by spending money to reach different levels of benefits. Points are earned during 6 month periods, and if you reach a level, you get its perks for the remainder of that period plus the whole next period. You earn 1 point per dollar spent on UberPool, Express Pool, and Uber Eats;  2 points UberX, Uber XL, and Uber Select; and 3 points on Uber Black and Black SUV. You’ll see your Uber Rewards progress wheel at the bottom of the homescreen fill up over time.

Blue: $5 Credits

The only Uber perk that doesn’t reset at the end of a period is that you get $5 of Uber Cash for every 500 points earned regardless of membership level. “Even as a semi-frequent Uber Rewards member you’ll get these instant benefits” Janakiram says. Blue lets you treat Uber like a video game where you’re trying to rack up points to earn an extra life. To earn 500 points, you’d need about 48 UberPool trips, 6 Uber Xs, and 6 Uber Eats orders.

Gold: Flexible Cancellations

Once you hit 500 points, you join Uber Gold and get flexible cancellations that refund your $5 cancellation fee if you rebook within 15 minutes, plus priority support Gold is for users who occasionally take Uber but stick to its more economical options. “The Gold level is all about being there when things aren’t going exactly right” Janakiram explains. To earn 500 points in six months, you’d need to take about 2 UberPools per week, one Uber X per month, and one Uber Eats order per month.

Platinum: Price Protection

At 2,500 points you join Uber Platinum, which gets you the Gold benefits plus price protection on a route between two of your favorite places regardless of traffic or surge. And Platinum members get priority pickups at airports. To earn 2,500 points, you’d need to take UberX 4 times per week and order Uber Eats twice per month. It’s designed for the frequent user who might rely on Uber to get to work or play.

Diamond: Premium Support & Upgrades

At 7,500 points, you get the Gold and Platinum benefits plus premium support with a dedicated phone line and fast 24/7 responses from top customer service agents. You get complimentary upgrade surprises from UberX to Uber Black and other high-end cars. You’ll be paired with Uber’s highest rated drivers. And you get no delivery fee on three Uber Eats orders every six months. Reaching 7,500 points would require UberX 8 times per week, Uber Eats once per week, and Uber Black to the airport once per month. Diamond is meant usually for business travelers who get to expense their rides, or people who’d ditched car ownership for ridesharing.

Keeping Everyone Happily Riding

Uber spent the better part of last year asking users through surveys and focus groups what they’d want in a loyalty program. It found that customers wanted to constantly earn rewards and make their dollar go further, but use the perks when they wanted. The point was to avoid situations where riders says “Oh I’ve been an Uber user for years. When something goes wrong, I feel like I’m being treated like everyone else”, Janakiram tells me. When riders think they’re special, they stick around.

One big missing feature here is a Rewards calculator. Uber could better gamify earning its perks if there was an easy way to see how many more monthly or total rides it would take to reach the next level. It’d be great to have a few little sliders you could drag around to see if I just take Uber X, how many of my average length trips would it take to level up.

Uber managed to beat Lyft to the loyalty game. Lyft just announced that its rewards program would roll out in December, allowing you to earn discounts and upgrades. But Southeast Asia’s Grab transportation service started testing a loyalty program back in late 2016 where you could manually redeem points for discounts.. While Uber’s rewards are more predictable and automatic, it does seem to have cribbed Grab’s rewards period mechanic where you keep your perks through the end of the next cycle. We’ll see if Uber mistakenly gave too much away and will have to reduce the perks like Grab did, pissing off its most loyal riders.

One risk of the program is that Uber might make users at lower tiers or who don’t even qualify for Gold feel like second class citizens of the app. “One thing that’s important is that we don’t want to make the experience for people who are not in these levels poor in any sense” Janakiram notes. “It’s not like 80% of people will suddenly get priority airport pickups, but we do want to monitor very closely to make sure we’re not harming the service more broadly.”

Overall, Uber managed to pick perks that seem helpful without making me wonder why these features aren’t standard for everyone. Even if it takes a short-term margins hit, if Uber can dissuade people from ever looking beyond its app, the lifetime value of its customers should easily offset the kickbacks.

[Disclosure: Uber’s Janakiram and I briefly lived in the same three-bedroom apartment five years ago, though I’d already agreed to write about the redesign when I found out he was involved.]