Online taxi hailing company Taxify has introduced demand-based charges also known as Dynamic pricing, as it seeks to attract more drivers to its platform and solidify its presence in Kampala.
The pricing which has been rolled out is “to motivate drivers to go online during periods of high demand”. Dynamic pricing on Taxify is a feature that makes it possible for us to provide more rides even more effectively
This pricing mechanism allows the cab-hailing firm to temporarily raise prices on its platform when the number of rider requests shoots up. Unlike its main rival Uber, Taxify has not been raising prices during peak demand. Dynamic pricing was introduced to encourage drivers to go online during seasons of higher demand.
Essentially, it means that the fares at particular times and in particular areas can rise or fall slightly due to demand and supply indicators. The Taxify prices of all rides in that area are increased by a multiplier component ( displayed as 1.4x ).
“We ultimately want to ensure that great rides are available round the clock and so with dynamic pricing in place, driver partners are motivated to proceed to areas that are not very well supplied resulting in shorter ETAs and less wait time even during periods of very high demand.”, read a statement on the Taxify site.
When fares are higher due to dynamic pricing, riders are notified on their app that “Prices are currently higher due to high demand” and show the multiplier “1.6x” as shown before making a request.
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