--- title: Uber Launches New Pricing Model to Address Wider Target Group description: Uber launches new pricing model with greater focus on willingness to pay to address its widening target group. image: http://blog.pricebeam.com/hubfs/Blog/pexels-photo%20%281%29.jpg --- [Skip to content](https://blog.pricebeam.com/uber-launches-new-pricing-model-to-address-wider-target-group#main-content) [![PriceBeam](https://blog.pricebeam.com/hs-fs/hubfs/lead-flow-images/PBLogoTransparent%20(1).png?width=400&height=100&name=PBLogoTransparent%20(1).png)](https://www.pricebeam.com/) - Solutions ![RGM360](https://blog.pricebeam.com/hs-fs/hubfs/RGM360_Headlines.png?width=319&height=255&name=RGM360_Headlines.png)[PriceBeam RGM360](https://www.pricebeam.com/rgm360) is an end-to-end Revenue Optimization Platform, offering unmatched value by integrating market research, internal data with AI and next-generation simulation and optimization tools. 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[Newsletter](https://www.pricebeam.com/newsletter) - [RGM Pulse Survey 2026](https://www.pricebeam.com/rgm-pulse-survey-2026) - About - [Company](https://www.pricebeam.com/about) - [News & Events](https://www.pricebeam.com/news) - [Partners](https://www.pricebeam.com/partners) - [Press](https://www.pricebeam.com/press) - [Careers](https://www.pricebeam.com/careers) - [Contact](https://www.pricebeam.com/contact) ![Search icon](https://5018647.fs1.hubspotusercontent-na1.net/hubfs/5018647/Design/Icons/Font%20Awesome/search.svg) [All posts](https://blog.pricebeam.com/all) May 22, 2017 # Uber Launches New Pricing Model to Address Wider Target Group ![Picture of PriceBeam](https://blog.pricebeam.com/hs-fs/hubfs/Images/PBLogoBadge240x240.png?width=50&name=PBLogoBadge240x240.png)   PriceBeam  ·  1 minute read ![uber pricing](https://blog.pricebeam.com/hs-fs/hubfs/Blog/pexels-photo%20(1).jpg?width=1024&name=pexels-photo%20(1).jpg "uber pricing") Uber recently launched a new pricing model called "route-based pricing", where the driver pay is no longer based solely on how much passengers pay. This new pricing model allows Uber to charge a higher price to passengers based on time of day and destination. What is interesting about the new pricing model is that it is much more focused on aligning prices with the willingness to pay of passengers. Prices will to a greater extent be based on historical willingness to pay data which factors in a much broader range of factors than the previous one. In particular, this will result in higher prices for passengers ordering Ubers in high-income neighborhoods, and moreover, this new model should result in slightly lower fares for UberPool, where passengers share Ubers with other groups, while the premium service UberX, will become slightly more expensive. Clearly, Uber is addressing the increasingly broader target group for its services. While traditionally, the key competitive priority of Uber has been its lower prices, especially the premium segment is getting bigger. And thus, this new pricing model allows Uber to reach a very price-sensitive segment with its UberPool service that now has become cheaper, while capturing more profits from the premium segment that are traditionally used taxis or private chauffeurs. Ultimately, as drivers are no longer paid a fixed percentage of the fare, Uber will be able to put more profit in its pocket -- and since the pricing is based on sophisticated willingness to pay research, the decrease in market share will be insignificant. 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They use methods such as cost plus a fixed margin. They use guesses and gut feel. They peg their price to a competitor’s. They price themselves too low, leaving money on the table, or too high, forsaking sales volume. They lose out on the profits they should be earning. PriceBeam changes all that. With a methodology that is confirmed to be accurate in thousands of projects, PriceBeam provides AI-powered market insights software that generates actionable insights into consumers' willingness-to-pay, competitive price positioning, packaging and assortment dynamics, promotional benchmarking, and opportunities from new product pricing. 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