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The Uber Eats Game Changer: Promotions, Tipping and when it Makes Sense to Deliver Uber Eats

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For me, it was always hot or cold with Uber Eats. I would either do a pretty regular number of UE deliveries, or would barely touch them. That may have changed.

Understanding Uber Eats and Promotions

I will start off by saying that when it comes to the money we actually receive from the delivery companies, Uber Eats has consistently paid out far more than anyone else.

This was because they tended to pay out a lot more in promotions and bonuses than anyone else. However, the promotions were hot and cold.

There would be times when Uber Eats would offer some fantastic incentives to get drivers out, and a delivery even without a tip could often be more profitable than those with other apps that had decent tips. And if you got a tip on top of it, that was icing on the cake.

Uber Eats Sign on the Door of a Restaurant
An Uber Eats sign on the door of restaurant.

Promotions are meant to help Uber Eats, not drivers.

This is something you have to understand when doing deliveries for Uber Eats. They do not offer promotions and bonuses for our benefit.

Ubereats will pay the lowest they have to pay to ensure food is delivered. They only offer promotions and benefits as incentives when there is a risk that there are not enough available drivers for their orders.

An undelivered order for any of these companies is a very bad thing for them, so this is what they do to get drivers out.

The incentives can often backfire for drivers. What I mean is, they can offer a particularly enticing promotion, and you log in excited about the payout and….

A cricket. Symbolizing the sound of crickets that you hear when there's nothing really happening.
Insert the sound of chirping crickets….

See, Uber's incentives work. Too often they work so well that there are way too many drivers logging on for the orders available, so the time between offers is too long.

You might make more on a delivery but you also end up waiting a lot longer for the next opportunity.

This is a brief description of the promotions,

I won't go into much detail.

Their main offerings are boosts (offering a higher percentage of pay on their delivery fees), quests (a bonus for completing a set number of deliveries in a specific time frame) and and surges(additional pay per delivery).

They've toyed with other promotions. I've had times where they had a guaranteed minimum per hour if you completed so many deliveries.

Each of these has its purpose. Usually it's to get drivers out at certain times, or to improve acceptance rates. Sometimes they need drivers to be out more regularly or consistently.

The main thing is, they have to keep orders fulfilled. That's hard to do when you cannot control when independent contractors go deliver.

The whole point of the incentive is to encourage results, not to simply pay us well.

This leads to Uber Eats having the most inconsistent payouts for deliveries.

You could deliver food from a particular restaurant to a particular customer and make $4 one day, and make $10 for the same exact delivery on another day.

If you are a selective about your deliveries (and you should be) the $4 delivery usually isn't worth doing, the $10 delivery is a different story. And because they have been hot and cold on payouts, I've been hot and cold on when I drive for them.

Notice what's missing so far in this discussion?

Tipping.

For too long you had to make your decisions with UE on what the payout FROM UE was. You couldn't factor tips into the decision because there was too much possibility you wouldn't get one.

Why Uber Eats customers didn't tip.

I'm probably in the minority on this one, but I don't think it's because customers are cheap. I don't even think they are intentionally lying when they say they'll tip on the app and don't.

It's all about timing, psychology and pain.

Scientists have found that the parts of your brain that react to pleasure AND pain are active when you make purchasing decisions. What that means is when you decide to spend money, you have to overcome a bit of psychological pain.

This has a lot to do with why impulse purchase items are at the checkout line. You've already made the decision to purchase, so adding something on is literally less painful than if you buy it itself.

Keep the Change

Meney left in a tip tray

Tipping works the same way.

The time that a customer tips often has more to do with the amount than anything like service or customer satisfaction.

That's why tipping is usually done at the point of purchase. It's less painful to give away the change as a tip or donation because we've already paid money out

For a brief moment, deep down, we don't see the change as ours, and our brains don't register giving the change away the same as if we pull the money out of our wallet to give away.

That fact has more to do with why tipping from Uber customers had been so much less than with platforms like Grubhub and Doordash.

(Update: This was written back at a time when Uber Eats customers could only tip after the order was completed)

With Uber, tipping has always been a separate spending decision. You had to go back into the app after delivery to tip. In fact, you had to be pretty dedicated to doing so because you had to dig a little to find it, going in first to rate the driver and THEN decide to tip.

There's more psychology going on here. When a customer places an order, it creates a sense of anticipation. When food arrives, you combine anticipation with hunger, and there is only one thing on the mind of the customer: eating.

Even if they intend to tip on the app, that's going to have to wait. They want to enjoy what they've been waiting for and I get that. It's just too easy for people to forget about tipping when that happens.

The Game Changer

For the longest time I've thought that how Uber does things with their promotions was unsustainable. Too often the payouts they gave to drivers with the promotions and all were more than they were receiving from delivery fees and even from commissions for the food itself.

But they had to do it to keep drivers from completely crossing over to competitors who paid out less out of pocket while drivers made more money because of tipping.

It appears that Uber is finally catching on. At least in some markets, they now offer the option to tip when you are placing the order.

Drivers still don't see ahead of time if they are getting tips, and drivers won't actually see the tip amount until an hour after the delivery is completed. This allows the customer the option to go back in and adjust the tip if they had really rotten or really great service.

Now, customers can tip when they place the order.

I'm not as fond as the $2, $4, and $6 options listed, compared to how other apps will default to a percentage of the order.

I do actually like the fact that customers can go in and update the tip – it's a good risk aversion tactic because the one downside I hear from customers about tipping at the time of order is that too often you get horrible service and you regret the tip.

This provides a good option for people who are concerned about it. I would expect that the number of people who go in and change their tip amount will be extremely low, and it'll normally happen only in extraordinary circumstances.

This is going to lead to some serious changes for Ubereats drivers.

On the downside, I think you'll see some of the fantastic promotions go away, as Uber is going to discover they don't need them as much. On the other hand, more consistent tipping from Uber customers added to their fare structure will definitely make them a more attractive alternative.

It's definitely something to make you think about throwing in some extra UE deliveries when you might not normally have considered them before.

Could this help someone else? Please share it.

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