Thursday, April 19, 2018

Lyft is Testing Monthly Subscription Plan

Lyft is testing monthly subscription plans for high-frequency users, a sign that the company is shifting toward a Netflix or Spotify model for transportation. The terms of the subscription models seem to vary but appear targeted at users who spend up to $450 on ride-hailing a month. One all-access pass offered up to 30 standard Lyft rides for $199 a month, another was priced at $300, and another at $399 for 60 rides. Individual rides up to $15 were covered under the all-access pass. It wasn’t immediately clear how users would be charged for rides that exceed $15.

Uber also tried a similar idea last summer, and it definitely makes sense. Locking up demand is the best way to lock up supply and I believe both Uber and Lyft should focus on these models and should spend more extravagantly here. However, given that Uber hasn't spent a lot of resources here, it is a  biggest red flags about just how valuable this market might be.

Source: https://www.theverge.com/2018/3/15/17127002/lyft-all-access-monthly-subscription

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