How Pay-Per-Car Marketing May Change the Way You Do Business

Pay-Per-Car Marketing

What if you could offer customers who buy a certain amount of your products and services free transportation to your store or restaurant? Do you think that would give you an edge over your competition? Uber and Lyft are now testing programs like this to find out how they work for both merchants and consumers.

If the strategy does work, it could easily prove transformative in the local retail and restaurant business – and perhaps beyond. Industry experts predict it could even take the place of pay-per-click marketing at a local level, or at least provide an alternative to it for certain types of businesses.  This is because the conversion rates for these types of ads are predicted to be significantly higher than the more traditional pay-per-click approaches for local markets. Here's why: once a customer selects a business' ad and orders an Uber, backing out of a purchase will cost the customer money, as the ride is only validated with purchases.

Local businesses that pay for these rides will also be able to close the online-to-offline attribution gap as they will know precisely the source of these sales and when each sale was made.

So far, only a lesser version of pay-per-car rides are available and it is limited to the apps of Uber and Lyft and their partner affiliates. Uber Offers currently only includes the opportunity for customers to get from $5 to $20 off their next ride if they make purchases at partner stores such as Whole Foods or Dunkin Donuts in cities like Boston, New York, Dallas, Miami and San Francisco. Using Visa as the platform, customers select the offer and then use the Visa card associated with their Uber account to make the purchase at the store of their choice within the next few days.

But such programs are really expected to become ubiquitous when companies like Uber and Lyft make self-driving cars the norm. That's because drivers for these companies currently take home 75% of the fare profit for each ride. Without drivers, ride service providers can significantly cut prices, making it much more affordable for businesses to pay customers' fares to their locations. Tesla already plans to run such an autonomous ride service through its Tesla Network at some point in the near future.

If and when pay-per-car marketing takes off in self-driving cars, participating businesses will have further opportunities to sell to their passengers who are a captive audience during their journeys. This considered, you can expect to see interactive screens with advertisements in center consoles and on the back of headrests. Want to be part of the first wave of pay-per-car participants? Here's how to prepare:

  • Make sure your location data is accurate.
  • Make sure your inventory is ready.
  • Start now on a creative advertising plan that could reach customers in self-driving cars.

As ride services solidify their pay-per-car programs and find ways to occupy passengers' idle moments – which they are likely to spend on their phone or using some device in the car – opportunities to market creatively and successfully in these venues will abound. There's little doubt that you and your business will want to be part of those initiatives.