When we asked Animo members how they calculate their earnings, almost half of respondents said they set a target for the day and drive until they reach it.
This thinking is very common among drivers, according to an article from The New York Times. The article concludes that driving until you meet a daily target is generally not be the best way to maximize earnings.
In this 3 minute lesson, we introduce you to a different way of thinking about your earnings that could produce better results. Keep reading to learn more!
Driving for a daily target
Driving until you hit a daily earnings target seems like a straightforward plan. We know what we want to earn in order to pay the bills or save up for that vacation. If we just earn a little bit each day, we won't have to scramble quite as much to make that rent payment.
But what happens when you find yourself without many passengers? Should you keep driving until you hit that earnings target? As straightforward as it seems on the surface, aiming for a daily target could hurt you more than it helps.
That's because when demand for rides is LOW, that strategy says to drive MORE. The result: fewer dollars per hour.
On the other hand, when earnings are HIGH, you hit your target quicker and drive LESS.
There has to be a better way!
Driving to maximize your earning rate
Instead of targeting daily earnings, Animo recommends you try to maximize your earning rate - the amount you earn per hour.
Here are a few tips:
1. Choose shifts wisely: Aim for hours when you expect to earn more than average (we recently reported on the highest earning times of the week in LA).
2. Ride the hot streak: When business is good, put in the extra time! Try to extend your booking and stay on the road while your hot streak lasts.
3. Set a weekly target: If you want to have an earnings checkpoint, try end of the week. That way, you'll know whether you're putting in enough time to meet your financial goals.
You may find it useful to rank windows of time from highest earning potential to lowest. Work down the list until you've met your goal for the week.
Make the most of your time on the road, and watch your earnings increase. Now, better start thinking about what you'll do with the extra money you've earned!
What are your thoughts on this lesson? Will you be changing your approach to ridesharing based on this information? Let us know by emailing into firstname.lastname@example.org what you think of this week’s Coach Training!