The ridesharing industry is a constant competitive battle between the two behemoths - Uber and Lyft. Each company is coming up with new tactics to win customers - hot partnerships, fares competitive with public transport, puppy delivery - the list goes on. At TXN, we have the unique opportunity to analyze the spend of both loyal patrons and customers who use both services, a group we’ve dubbed “the value riders.” We took a look at our ridesharing panelist data to determine the size of the value rider opportunity, and it turns out that they’re not only plentiful, they are also the power spenders of the ridesharing industry.
54% of California panelists ride exclusively with Uber, 19% ride only with Lyft, and 27% use both ridesharing services. While Lyft-only customers spend the least per ride, the value riders also maintain a pretty low average cost per ride. That said, a value rider takes about 2-3x the amount of rides per year a loyal Uber or Lyft customer does. When Lyft pricing is surging during a rainstorm in San Francisco, they use Uber, and vice versa. And all these rides add up: even with a cheaper average ride than loyal Uber riders, value riders have more than double the average spend of a loyal Uber rider and over 4x that of a loyal Lyft rider.
With Uber dominating the market, it will be key for Lyft to capture these value riders; these customers are already ridesharing savvy and spend magnitudes more than current loyal customers. Understanding and addressing value rider characteristics and needs will be imperative if Lyft wants to increase market share and compete with Uber for this segment; given how valuable they are, converting even a minority of value riders into loyal Lyft riders could make a huge difference.
Behind The Data: We analyzed the past 365 days of data from our California panelists’ ridesharing spend for Lyft and Uber. We classified someone as a “loyalist” if they have used a single service and an “value rider” if they have used both services over the last year.
Learn more about consumer spending analytics with TXN.