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Most taxi-hailing start-ups have gained traction by using referral programmes that offer discounts to existing customers if they get others to use the service. However, there seems to be a realisation that these discount programmes are being misused. Consequently, companies have started putting filters and software to detect such users. And, customers are seeing free rides worth thousands suddenly disappear from their accounts.
A Uber customer, who does not wish to be named, says he had around Rs 5,000 worth of free rides in his account. It all disappeared suddenly on one day. Some days earlier, he tried to book a cab to his office after a meeting. The transaction didn't go through. When he reached office, he realised all the money he earned through the referral was gone. "When I contacted the customer support, they told me I had violated their terms and conditions. I still don't know what went wrong," he says.
How referrals work
When a person downloads the app and signs up, he or she gets an invitation code. He or she needs to share it with others. When friends and family use the code in their maiden ride, the original code owner is credited with money.
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UBER User earns: Rs 600 On first ride, friend earns: Rs 600 MERU A discount of Rs 150 on first trip booked through app using promo code MERU150 OLA CABS User earns: Rs 100 On first ride, friend earns: Rs 100 TAXIFORSURE User earns: Rs 100 On first ride, friend earns: Rs 100 |
Uber, the world's second most valuable start-up, offers a princely sum of Rs 600. Ola Cabs and TaxiForSure offer a benefit of Rs 100 to each user. Though Meru has a referral programme in place, it has not yet started it. The company offers a flat Rs 150 off on the first ride.
Accounts suspended?
When a customer signs up, companies use different parameters to look for genuineness of the account. Rathin Lahiri, chief marketing officer at Meru Cabs, explains they authenticate the customer by checking the e-mail address, phone number and IMEI code. So, even if a person makes a new account by using a new SIM card and a different e-mail account but on the same phone, he or she might not be able to take the benefit of the promotion multiple times.
"Companies are spending on discounts to change consumer behaviour. The idea is that more people should experience the benefits we offer first-hand and realise that radio taxis are convenient, hassle-free and cheaper than maintaining a chauffer-driven car," Lahiri says.
When asked the reasons that can lead to deletion of referral credits and how the company tracks it, the Uber spokesperson said in a written reply: "Illegal account activity pertaining to promotions is tracked and monitored automatically (using algorithms)." He directed to the referral policy, which says: "Public distribution (of referral code) on sites where you are a contributor but not the primary content owner (e.g, Wikipedia, coupon websites) is not allowed. Promoting your referral code via Search Engine Marketing (e.g, AdWords/Yahoo/Bing) is also not allowed." E-mails to Ola Cabs and TaxiForSure remained unanswered.
Benefiting from promotions
Of course, the best way to benefit from these apps is to follow the policy laid down by the companies. When you install these, they ask for various permissions that help them collect data. Some of these include your name, e-mail accounts on the phone, IMEI number and location services. These help the companies to track the customers.
At times, following the rules might not be possible. Say, your parents don't have an electronic payment mechanism to transfer money to the app wallet and they need to use the one you have. Use a different mode for such transactions. If you use a credit card with your mobile wallet, use a different credit card for your parents or debit card or online bank transfer. Some users who lost their free rides feel their referral credits were deleted because they used the same credit/debit card to transfer money to different accounts.
Using multiple accounts on your phone can also lead to companies deleting your free rides. Say, you have a friend who is unable to access a taxi service on their mobile. To help them, you sign out from your account and log in with their credentials. Companies track the IMEI number and the system might flag you for using multiple accounts from the same device.
| I lost referral credit of $50,000: Blake Jareds |
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Blake Jareds, a 25-year old from New York City, managed to collect around Rs 30 lakh ($50,000) worth of referral credit in his Uber account. One day, he discovered the company had frozen his account 'until further notice'. In an edited e-mail interview, he tells Business Standard his story. |
How did you manage to get credit worth $50,000?
I built up my credit by distributing my referral code to friends, via large email lists, and online communities. My referral page/code was highly ranked on Google as I had used search engine optimisation technique to promote it. New riders got a $20-30 in credit for their first ride when they signed up on this referral page. I, too, got the same amount for each person (it started at $30, then changed to $20).
The money piled up from January to April 2014 before Uber took notice. I had earned credits from people signing up in the USA, Canada, UK, Australia, and Mexico.
When did Uber notice it?
I was unable to log into my Uber account in early April. I e-mailed them about the issue and they said my account was frozen until further notice.
Based on your experience, what are the things Uber takes into account for red-flagging users?
Uber is likely to flag an account if you give a driver a low rating or if the driver rates you low. They like to know why rides did not go as planned and will look into these rides. Your account will also likely be reviewed if, all of a sudden, you start taking very expensive rides and accumulate $100's of charges when your account typically doesn't have that type of activity.
When Uber blocked your account, what was your reaction?
I did feel cheated when they explained why they locked my account. I tried to fight it but it was clear they were not looking to argue or negotiate with me. I am confident that if I took them to court over the issue, the ruling would be in my favour, as their policies were very vague around the whole referral program when this initially happened (these have since been revised).
If you were to start all over again, how would you distribute the coupons to get maximum referral credit and which is also in line with Uber's policies?
I would change my referral code to something generic that is easy to remember and appears official. Then, I would make up a postcard/flyer/business card. I would stand outside in a busy area or outside a stadium after a match and hand these out. I don't think this is against their policy. You might not earn $50,000 in rides doing this but do you really need that much?
