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If a large number of drivers are dropping out of a particular city, why would it be?

Asked at Lyft
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Goal: Having a healty #driver population is important for to ensure overall business heath and success. Benefits of having a healty dirver population

  1. Expand coverage more in a given region / location
  2. Minimize wait time
  3. Improve driver-rider matching - Ensures btter customer experience
  4. Minimize usage of surge pricing, and incomple trips 

Riders need drivers more than drivers need riders -  Drivers have resonal alternaltive to make money. However, riders if they do not have their own vehicle will hav limited alternative to ride -  Competiters, Public transport, Taxis 

To analyze the drop in drivers, first I want to clarify what "drop" means here?

  1. Dec in new driver signups i.e. dec in driver app download or dec in completed registeration of driver account?
  2. Dec in returing drivers - Are drivers leaving the plaformi.e. deleting the app and deactivating? or #TimesAppOpened decreased  
  3. Dec in drivers usage -  Decrease in hrs spent driving per day? Decrease in number of times they are drving? Any change of state - High / medium/ low actvity in driving

For this  lets assume #drivers leaving the plaformi.e. deleting the app and deactivating?

Internal Factors

  1. Data logging instumentation broken? - is the sipke relvant and not because of logging issue
  2. iOs and Android app drivers? --- #Drivers by device type
  3. Any product changes impacting app funtioning - App frontend UI or Backend changes made which is making the app fail, crash and not open. Or Making it difficult for drivers to search for new rides/ obtain new rides or navigate to the passenger location. For e.g., changes in surge area ui making it difficult for drivers to find them in the app ---- #supporttickets by issue category
  4. Sesonal? comparison to previous year

External Factors 

  1. Goverment / Regulatory changes - Any new regulation or tarrifs? Any restriction (aiport pickups are not allowed in some places)
  2. Any OS level updated made that impacts the ability of drivers to use the app? Any latency in app usages - Is there an increase in support tickets on app crash or payment related app issues? Is the app crashing or failing to load.
  3.  Competition -  Any new market entrants? Any benefits / pricing / commmision changes made by existing competitors that is attracting our drivers? 
  4. Market trend - Is this seen across our competitors?
  5. Which City / Region is this drop observed? --- Assume equal distribution
  6. Bad media PR / press - Has there been any incident latetely (e.g. rider safety complains or concerns highlighted in media)?

Driver experience

  1. Is the change occurring within the entire driver population in the city, or among certain drivers only? e.g. only drivers that signed up in the past 6 months are affected
  2. Driver Safety? - Are we getting any complains from drivers?
  3. Rider and driver - demad x supply match? - Are there less ride requests? - #Total ride requests dec?
  4. Any revenue / benefit or commmision issue - Are drivers getting less commision than before. Any changes made to the driver revenue / commision model -  Metric to evaluate #avg commsion per driver per trip 
  5. Any issues from Drivers on their experience while driving using the app? 
    1. Increase in #support tickets from drivers 
    2. Technical issues w/ App - latency  in app, app crash or failing to open 
    3. increase in #rider wait time 
    4. Increase in trip pick up drive time - If drivers are driving a long time to pick up then they are not earning at that time. Inc in pick up drive time can deplete driver earning and then make drivers leave / exit platform. To overcome this we need to introduce "surge" procing at high demand times so that we can bring demand back to control and effectively match driver to rider tha optimized driver earning.
    5. increase in trip ETA 
    6. increase in ride cancellations 
    7. Dissatifaction on Driver rating / feedback? - Any change sin the rating and feddback process?

Solutions:

Techincal problem 

  1. Bug fix
  2. Feature roll back

Competitor influenced  or Driver Experiece  or External Factos

  1. Build a Product Solution focusing on Revenue, Driver experice, Market Share
  2. Build Marketing Solution to increase Awareness, interest, trial or registration 

 

 

 

 

 

 

 

 

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This can be analyzed in the following steps:

  1. Validate if the "drop" is valid
    1. There may be issues in the reporting pipelines / dashboards 
    2. Verify if the drop is sustained and not just a correction (returning to the prior baseline after a spike
    3. verfiy if it is not seasonal - presumably there will be lesser drivers during the holiday period as demand is lesser and drivers themselves may be on vacation. A pre question would be if the city in question is a vacation city such as Miami or a regular small city like Baltimore

Once the above factors are eliminated and it is indeed verified if the drop is valid, we can explore the potential paths by segmenting drivers on the following dimensions: 

  • Time - day, date , time of day 
  • Platform - ios or android 
  • driver availability - high, medium & low activity drivers 

Once we have the above segments defined and narrowed down we then evaluate them against the following two broad factors 

  1. External Factors 
    1. There may be a new govenrnment regulation passed in the city against rideshare companies which may make it less lucrative or even illegal for drivers (e.f., ban on airport pickups) 
    2. A new rideshare player may enter the market offering promotional revenue incentives for drivers 
    3. Update released to the ios/andorid OS that causes the app to crash/not open / fail 
  2. Internal Factors 
    1. Any changes to the driver app - ui / backend making it difficult for drivers to search for new rides/ obtain new rides or navigate to the passenger location. For e.g., changes in surge area ui making it difficult for drivers to find them in the app
    2. Any changes in the revenue model that is not well received by the drivers 
    3. Negative PR / publicity / scandals affecting the companys reputation - criminal incidents against passengers deeming the company unreliable and hence lowering the demand (longshot)
The above bullet points serve as possible paths in an issue tree of investigation that can be discussed with the interviewer and then narrowed down and further explored with interviewer input. 

 

 

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