Last week, we had a team of researchers come on the podcast and talk about their study of gig economy drivers. They are looking into things about what a platform has to do to keep their drivers or to attract drivers. If you hadn't noticed, the geek in me was in hog heaven. I'm fascinated by all the logistics involved for these companies.
Here's the thing with these delivery companies. They're all having a heck of a time keeping drivers. Now maybe it's that delivery can be a pretty good gig, so I don't know if these companies just think there's an endless supply of contractors. They can draft a TON of couriers, but those couriers jump ship, they work multiple apps, they move on to other things. How much money does Doordash pay out in referral fees?
And there's so much pressure to be profitable that the top guy at Uber Eats just stepped down. They can't just throw money at the problem. They have to find other ways to attract and keep drivers, and to get them to actually DELIVER when they need deliveries done.
Finding the things that matter
The key for these companies on reducing turnover and increasing loyalty isn't money. It's finding the intangibles and the non-monetary things that earn loyalty. It is doing things in a way that make it worth doing things for them. The best managers in the employment world already understand this concept: Money often isn't the thing that gets people to do their best for you. It's the little things. (If you want a great book on the subject, check out First Break All the Rules by Marcus Buckingham and Curt Coffman – just a great book on management (affiliate link)
And I think this is why Grubhub, Postmates, Uber Eats, Doordash and all these other platforms have a real problem right now.
It's hard enough to build team loyalty and team engagement, especially without throwing buckets of money at the issue. But you add to the mix that we're independent contractors, they have no legal ability to control how we work. How do you get people to fulfill your orders when you can't require them to do it? That's the kind of thing that makes the study that Lance Saunders, Vince Castillo and Bill Rose are working on so fascinating.
I have a fear though. That they're spinning their wheels. I don't think these companies care about any of this. Rather than building relationships with their driver community, they want to try to force us into compliance.
Which is a crazy thing. With all the AB5 and ProAct stuff out there trying to push them into an employee model, when they're spending millions fighting this legislation, you would think they'd realize that trying to control contractors who you're not allowed to try to control kinda makes the case for these legislators, wouldn't they? So paying attention to this kinda stuff makes sense, I would think.
I'm seeing a shift in where I'm focusing most of my energies.
For the longest time, Grubhub was my go-to. There were two key factors there: One was consistency. Once I was signed on to a block, I knew the orders would come in pretty regularly. That doesn't mean they were always orders I would take, but there was a steadiness. The other factor – while it involves money, it's not money out of their pocket. Grubhub is better than anyone at encouraging tips. (Quick side note – Uber Eats is slowly gaining ground in my eyes because they're getting better at this).
But I will say that's changing.
Grubhub has gone from 75-80% of my work to 60 in recent months. A lot of that has to do with consistency. I can't rely on them. They're starting to play games with their dispatching and I'm more likely to turn on Doordash or Uber Eats to make sure I stay busy. And the crazy thing is, sometimes it's when Grubhub really needs me the most that they start playing these games.
They're saturating markets and making it harder to get time blocks. You know, they have that right – and when I'm taking only 20-30% of offers, they need to get offers taken. They feel like if they get more people in who are willing to pursue Premier status to get the schedule blocks, they'll be better off. And that might work during slow times, but when things are really busy? When the orders are hopping? I'm more likely to be delivering for someone else now and they still aren't getting orders fulfilled.
Non monetary things impact me in other ways.
It's a non monetary thing that has me pretty much boycotting Postmates right now. The perception is out there that they pay so poorly, but as someone who tracks every order I can tell you that Postmates orders that I've done have been paying as well as if not better than anyone else .
But they started stacking orders into my queue without my permission. And then they started punishing me when I would unassign those orders by putting me in time out. They started deactivating people for unassigning those orders. And that crosses the line. I'm done with them, and it has nothing to do with money.
So, Matt Maloney, Tony Xu, Bastian Lehman, Dara Khasrowshahi…. what can you do to get me to deliver more for you? (Or even accept more orders?)
Let me be real honest here. I know none of you are listening. It's not just that this is a tiny insignificant podcast but you aren't receptive to this message. I don't believe you want to hear the message.
Maybe fixing that perception is your first step?
But guys, I'm across the board maybe 20% in acceptance. That could be higher and you wouldn't have to pay more in delivery fees to make it better. I jump around a lot, but I also know that if someone recognized a lot of these things I'm about to tell you, you'd see a LOT more orders being taken. And you could get there without increasing delivery fees that you pay out.
All you have to do is show more respect. Respect me, respect the things that are involved in my running a business (a relationship YOU chose to implement). When you do that, you solve a lot of problems.
Respect Your Drivers
In last week's episode, I introduced the interview by talking about how Grubhub had such an incredible loyalty among drivers. It was amazing when you think about it. And it just evaporated in a short period. They did some good things to build loyalty. A lot of the things that disrespected drivers contributed to that evaporation.
Matt, once upon a time, you made it easier to deliver for you. You had a dedicated driver care team that made it easy to figure things out. Your driver specialists were accessible. When I started out with you guys, there was more of a sense of partnership. And then you started treating us as adversaries. You took away the easy access to driver care. Your specialists became unresponsive. You manipulated and bullied and coerced. You threatened us. It's like the respect we felt with you shifted, it did a total 180. I'm not sure you'll ever get that back. You were the one company that never needed referral programs – But you're finding that it's not as easy getting and keeping drivers lately, aren't you? I wouldn't be surprised to see Grubhub introducing referral bonuses before the end of the year.
Respect us by acting with integrity.
Seriously, quit manipulating us with your spin and lies.
Matt, you guys pull this garbage of saying “hey, head on out because we're offering bonsus of UP TO $6 ON SELECT orders. Everyone knows that UP TO and SELECT are code words for ‘you're not getting squat.' If you're offering incentives, then don't make it iffy. Offer the freaking incentives and pay them out.
Tony: Everyone knows you're the king of spin. Everything about this pay model change is wrapped up in spin. Everything about the old pay model was wrapped up in spin. Justifying $1 base fee because “drivers are made whole” on other orders – that's all spin. You tell us base pay is calculated on time and distance, but then throw out $2 offers that are 10 miles away. So guess what? We don't believe you. When we can't believe you, it's harder to be loyal.
Respect our Time
You know something? You don't have to pay us more for us to be paid more. If you could recognize that one fact and really take it to heart, it could be a game changer.Bastian, that's one good thing you did – you poured some investment into being more efficient and I think that's why you became so profitable for me. You actually cut what you were paying but I was making more money on your deliveries.
Get efficient. Get better communicating with restaurants about when food is ready. Quit making us wait forever at the restaurant – Matt you're the absolute worst at this. The Order and Pay fiasco? If you're asking me to wait 45 minutes for the pizza place to finish that order, it's not happening.
My cherry picking and efficiency.
I know you see me as a cherry picker. But if you're paying close attention, I'm also rejecting $20 orders and I'm accepting $5 orders. Why? Because I select offers based on profitability per hour. Give me five $5 orders in an hour and I'm happier than if it were just a single $25 order. Because my profit is higher and my time isn't wasted.
Now maybe not enough drivers are thinking about efficiency for this to really make much difference. But seriously, if you got efficient and cut down the wasted time, you'd get a lot more deliveries done by the same people and have a lot less grumbling about those lower paying orders. When you increase the efficiency, you give us a pay raise and it doesn't come out of your pockets in the form of higher delivery fees.
Respect our Costs
You know it costs me money to do those 15 mile deliveries. You know that wear and tear on our vehicles is a big issue for us. But what did you do? You dramatically increased the radius from which customers can order. I know you think you can get more orders that way, but that's a really stupid move. When the customer is 15 miles from the restaurant, their food's going to be cold when we get it to them. And guess who's not ordering from you again? When we're not compensated well for that extra distance, we're less likely to take more of those.
And Matt, you're the worst at this.
It costs us a lot to operate our cars. But you send me more offers that are 7 miles away than you do to restaurants right by me. What's up with that? Are you just trying to time our arrivals? Is it more about manipulating us through your dispatching? Or are you guys just that incompetent? None of those three are going to increase loyalty.
Don't ask us to spend our money to do your work without respecting what it costs. Either start adjusting your pay for longer trips reasonably, or get a hell of a lot better in how you are dispatching. I really think the latter will do you more good.
Respect the independent contractor relationship.
Bastian, this is where you screwed up big time. When you took away the choice on multiple orders and you punish drivers for standing up for their rights here? That’s a major screwup.
Guys, I know it’s tough sometimes. There’s some idiot Driverrs out there. The stuff that some drivers do? I scratch my head at that stuff as much as you do.
But you realize don’t you – you signed up for this. More to the point, you insisted WE sign up for this. You chose to use contractors and you chose a model that doesn’t allow you to control our work
But that’s the problem, you try to.
You treat us like employees. You try to be the boss.
Here's the thing: you ask us to allow you to get out of the costs of hiring employees, to give up the protections that go with employees. But… you should respect that by not trying to take away the rights that go with being a contractor.
Matt, you lost that incredible amount of loyalty by doubling down on the bullying and the threatening. So you ask us to be independent contractors, you ask us do you a solid by letting you bail on taxes and insurance and all the stuff related to employment… and you try to control us.
And that pisses me off for this very reason: I WANT to be an independent contractor. I choose this option. If I have to be an employee to keep delivery, my delivery days are done. I don’t like AB5 and Proact and all that because it takes away my freedom. I think it infringes on the overall right of business ownership and it’s insidious.
But you idiots are giving them ammo.
They’re breathing down your necks, you’re spending millions and millions to fight these kinds of legislation, you’re spending millions on attorney fees… but you’re giving them ammo.
Don't be the Prima Donna customer here
Now here’s the deal with the independent contractor relationship. That makes you the customer. Yeah, it gives US a lot of rights, but it does relieve you of some obligations. In the end, since you’re my customer, you don’t really owe me anything. You can choose not to give me a single freaking order. I totally accept that.
But don’t be the primma donna customer.
Think about it this way – those morons that are out there ordering food and lying about not getting it so you get free food (and some putting it on video)? That’s the customer who tries to take advantage of the ‘customer is always right’ stuff…. Did you ever think that’s you?
Yeah, you can decide not to offer deliveries to me. That’s your right as the customer. You can play all the games you want. Bully for you. But you also know that when it comes to crunch time, when you are ALL needing my help like in a storm or during a busy event… who do you think is getting my attention? The non-prima donna, that’s who.
Have our backs
Matt and Tony, I'm really focusing on you. You guys need to learn this. Funny, you two seem to get singled out a lot.
If you ask us to go out of our way, have our backs. Matt, you guys are throwing out offer after offer that’s 7 miles away. So I think okay, you must really need drivers there, I’ll take one and stay busy. And guess what happens after I drop that off? Instead of keeping my busy there, you’re throwing another offer 7 miles in a different direction.
Tony, you really opened up a can of cluster with your latest stunt. Your account may be reviewed for deactivation if you have more than 1 delivery issue? Seriously, Tony? What kind of message does that send? I’ll tell you the message that’s been received. I hope you’re monitoring the forums and facebook pages, you’ll understand what a mess that is. The message that everyone got is, the restaurant forgets an item? It’s our fault. The customer lies about a delivery? It’s our fault. We’re the fall guy.
How do you build loyalty with that?
We’re more likely to look out for you if we think you care about what happens to us, you know.
Quit the threats and bullying
You’re all playing this game of threatening people with suspension and deactivation. You’re using fear and manipulation. I don’t know, maybe it gets some results but it’s more destructive in the long run.
Because you know who’s getting hurt by these games?
It’s the top dasher. It’s the premier driver. The top dasher is most likely to take that order by a customer who’s trying to score a free meal because the customer is less likely to tip. The top dasher is more likely to take that extremely late order because, well, they have to keep their acceptance rate up – but you put them into a lose lose situation now. Their rating goes down, they get a strike against them…. They’re screwed.
Do you see what you guys have done here? You’ve created a system that punishes the people who are already doing what you are trying to manipulate us into doing. In the end, it’s counter productive.
You can’t build loyalty among the people you throw under the bus.
If you really see this as a relationship of equals, treat it that way.
Here’s the thing, guys. You built this language in to protect the independent contractor status. You said it’s a business to business relationship, you use language like ‘a relationship of equals.’
Treat it that way.
Quit trying to be the boss. Respect the relationship YOU insisted on creating.
I realize that this sounds more like a gripefest. Maybe it’s me realizing there’s a lot longer way to go than I realize. But I think there’s some underlying stuff that IS positive.
It’s this accomplishing more with honey than vinegar thing. If anyone created a relationship with their contractors where you did the things you promised, where you did all these non-monetary things – you watched out for our efficiency. You create an environment where it’s worthwhile and good business to take more orders. You create an army of superfans among your drivers.
The Clustertruck example
I’m really intrigued by Harry the Rideshare Guy's interview with the guy from Clustertruck on his podcast. You should check it out – some fascinating stuff.
Chris Baggott runs a small delivery company called Clustertruck. They're just in a few markets. If Chris is to be believed they have a much higher retention rate with drivers. I want to talk about that real quick – here’s some things they mention: They have trained their customers to come out and meet the driver. Now this is a place that they prepare all the food, it’s like a ghost kitchen but they control the whole process. THEY meet the driver with the food instead of making the driver come in. They are all about efficiency…. And guess what? There’s a waiting list in the markets they’re at.
And oh by the way…. They’re profitable.
I mean, I know while listening part of it sounded like a red flag to me. When he talked about being able to control the process completely including controlling the drivers I'm thinking, wait a minute, these are independent contractors. But that said, if all the things about how they work with drivers is true, I can see myself taking more offers, maybe taking all of them. I know we didn't get to hear about any of the dark sides of the company in the interview. However, the lesson here is, when you respect the driver, you have fewer problems with drivers. You get them more likely to help you accomplish your goals.
So… yeah, maybe think about this guys. You don’t own the restaurant so the Clustertruck thing maybe won’t translate. But Matt, Tony, Dara, Bastian, the way you’re going right now, it’s your own kinda cluster that rhymes.
Respect the drivers. You’d be amazed what comes of that