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Uber, Lyft Lean In More on Loyalty Subscription Programs
25.08.2023 - 14:09 / skift.com / Dara Khosrowshahi / Matthew Parsons
Uber and Lyft are focusing on their loyalty programs, with new partnerships designed to keep members ordering cars, meals and groceries for longer periods of time.
Both have benefited from travel’s wider recovery, reporting record revenue for the fourth quarter ending December 31. But their focus is now on subscriptions to lock in customers.
Uber grew the number of Uber One subscribers to 12 million during 2022, 90 percent up on 2022, it revealed this week as it announced its fourth quarter results on Wednesday.
It managed to launch the cross-platform membership program in France, Japan, Spain, Chile and Taiwan during 2022. Credit cards are a part of the plan too, and it now gives Capital One cardholders up to 24 months of free memberships.
“We think Uber One is a terrific membership program,” said Dara Khosrowshahi, CEO and director, during an earnings call this week. “We are quite actively continuing to innovate in terms of the benefits that we offer, and the results are pretty spectacular.”
In terms of those results, program members spend four times more a month the amount that non-members spend. And globally, 25 percent of its gross bookings come from members, while in the U.S. 40 percent of its delivery gross bookings are from members who are signed up to Uber One.
Lyft is also expanding its subscription, Pink, after relaunching it last year. Like Uber, it also partnered with a bank, Chase, and it gives its Sapphire Reserve card members a free two-year subscription.
“With this partnership, we can introduce millions of people to Pink, increase our touch points with business travelers and capture more high-value rides,” said John Zimmer co-founder, president and vice chairman, during an earnings call on Thursday.
The company also expanded its travel loyalty integration with the addition of Alaska Airlines.
The fact that both companies are prepared to take a hit and absorb the costs of new members, in the early months at least, reveals their importance.
As expected considering travel’s recovery, Uber and Lyft reported “record quarters.”
Uber revealed a record number of trips in the quarter, at 2.1 billion, up 19 percent on the fourth quarter in 2021. Revenue was $8.6 billion, and net income was $595 million, which was a third higher than the same quarter in 2021.
For Lyft’s business division, managed bookings grew more than 60 percent year-over-year, following the return of large events and conferences, and were at a record level. Revenue of $1.2 billion was 21 percent up on the same quarter in 2021, but overall it posted a net loss of $588.1 million for the three months to Dec. 31, 2022. compared to a $283.2 million loss for the fourth quarter of 2021.
The duo have been particularly exposed to the
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