In a LinkedIn post, Niraali Parekh, founder and creative director of Bokap Designs, described a curious incident involving a colleague who booked an Uber ride simultaneously on two different phones, an Android and an iPhone, for the same pick-up and drop-off. score. The results? Significant difference in charges: Android's charge was Rs 290.79 while iPhone's charge went up to Rs 342.47.
Parek added that this disparity is no accident. Instead, it reflects a calculated pricing strategy informed by design thinking, user insights and data analytics.
According to Parekh, there are three main factors at play:
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User behavior insights Uber and other ride-hailing apps use data on iPhone users who are often considered “premium customers.” Research shows that iPhone users are generally more willing to pay for services. These insights influence pricing decisions, creating a “device-based” dynamic pricing model.
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Stage charges Apple charges app developers a 30% commission on in-app purchases, significantly higher than the fees associated with Android's Play Store. This commission structure indirectly affects pricing strategies, as businesses try to offset the higher costs associated with Apple's ecosystem.
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Dynamic personalization Modern applications increasingly use dynamic pricing algorithms that adapt to user behavior and profiles. Factors such as device type, browsing patterns and purchase history can subtly influence the rates displayed to users.
In her post, she raised a pertinent question: “When does personalization improve the user experience, and when does it start to feel exploitative?” While pricing strategy may be the first to understand and adapt to user behavior, its ethical implications remain murky.
From a business point of view, dynamic pricing represents a smart approach to maximizing value. However, for users, it can break trust if it is perceived as manipulative or unfair.
The post has since gone viral, with users flocking to the comments section to share their thoughts. Responses have been polarized, highlighting the complexity of the issue.
Some commentators have viewed the pricing strategy as an inevitable consequence of a data-driven business model. One user wrote: “Not only Uber but it happens on many platforms. I recently found this on MakeMyTrip as well. When I try to book from my iPhone they charge more from hotels. When I check the same hotel for the same date Showing very low cost I found my wife's android phone by accident.
Critics, on the other hand, described the price discrepancy as a breach of trust. One comment reads: “We call a spade a spade. This pricing system is unethical. When there is ZERO price transparency, consumers are taken advantage of. This is a misuse of data and planning to extract value from consumers while providing no tangible benefit.” Reverse dynamic pricing is bad.”
“This is true. It depends on various factors like customer location, boarding status, customer/driver rating, official/private travel, commission to dealer/app. The price can never be the same. When the government decides to intervene and fix the price. Only. Buyers beware, this could be over,” one user commented.