Certify’s SpendSmart Report Sees Uber Slip, Lyft Gain — and Air Travel Be More Competitive Than Ever
Uber and Lyft continue to capture an increasing share of employee travel and expense costs as measured by the Q1 2019 SpendSmart Report from Certify. In addition to continuing to decimate taxi services in all but a few protected markets, both services have continued to increase their prices since the first quarter of 2018, with Lyft experiencing double digit growth in some key markets.
Certify is an online spend management solution for companies of any size, providing cloud services and mobile applications to capture expense reporting worldwide. The T&E report aggregates data from over 10 million expenses and receipts submitted during the first quarter of 2019, measuring average costs,%ages of total expenses, and user submitted ratings of respective services for purchases of food, travel, accommodations, and other items used for day-to-day business.
Fierce airline competition continues to drive down prices in the domestic U.S. market, with only Delta able to grow their average ticket price at a pace greater than inflation since Q1 2017. American and Southwest have seen their prices grow more slowly than baseline inflation, and average prices for tickets on United Airlines have actually fallen $5 in the same two years. Among airlines, Delta’s robust business captured over 19% of category expenses with a satisfaction rating of 4.5 of 5 — the highest among legacy airline carriers and second only to a 4.6 rating for smaller regional carriers like Alaska Airlines and JetBlue.
Among food and drink vendors, Starbucks captured 5.4% of category expenses, more than double McDonalds as the closest competitor with just 2.65%. Starbucks also came second only to Uber as a proportion of total expenses reported at nearly 4% of all receipts.
Catering, a popularly expensed item, was dominated by Chick-fil-a, Panera Bread and Jimmy Johns, pushing the average cost of an order from these businesses to over $30 each. Chipotle was also affected by catering demand with an average order price of over $27.
Grubhub, the clear leader in food delivery just a year ago with nearly 40% of receipts, now faces the real prospect of being matched or overtaken by Uber Eats or DoorDash, the latter of which grew their market share by 5% in just the last year. Uber Eats holds the edge in satisfaction ratings with a 4.6, significantly higher than the 4.1 ranking for both Grubhub and DoorDash and topped only by the newer Caviar service, catering mostly to high-end customers and commanding an average order price nearly double most competitors.
Marriott dominated the accommodations category, capturing over 9% of all expensed bookings and incidentals with an average cost of over $300. Despite a lower cost, higher satisfaction rating, and greater number of locations worldwide, Hyatt captured only 2.65% of bookings, less than a third of the leading Marriott.
While Uber continues to hold a major share of the most important markets in the U.S., its total share of ride hailing receipts fell from nearly 75% in Q1 2018 to 72.7% in the first quarter of 2019. During that same period, Lyft grew from 17.7% to 21.6%, a growth rate nearly double that of the decline reflected in Uber’s share of ride hailing expenses. Lyft is capturing share from both Uber and Taxi services, in some places much more quickly than others.
In Atlanta, Lyft grew its share of ride-hailing services from 16% to 24.4% over one year, an 8.4% increase that could spell trouble for Uber. Other major cities, including Los Angeles, Chicago, Boston, Dallas and Miami, saw similar 4% to 6% gains from 2018 to 2019. Notably, Lyft receipts fell from 28% to just 21.2% in its home city of San Francisco. While it’s still too early to tell if the drop will carry over into the coming year, the experience in San Francisco may prove a leading indicator across many regions as Lyft works to hold onto and grow market shares of 25% or more than have only recently been achieved.
If Lyft makes good on plans to deeply integrate with public transit and other transportation services, they might also find greater success absorbing market share in cities where taxis have so far staved off total collapse — in New York almost a third of expensed rides are by taxi, and in Chicago just under 14% of riders still hail from the curb.