Surge Pricing - An economic offence

And just when the middle class and the millennials are rejoicing on the arrival of  cab aggregators such as Ola and Uber to teach a lesson to fleecing autos, the cab aggregators have suddenly introduced 'surge pricing', thereby, abruptly ending consumer happiness. Is surge pricing a consumer-friendly approach? Is it day-light robbery in the name of supply demand economics? Is it a kill joy in an already anti-consumer market? Let's discuss. 

What is surge-pricing?

When supply overtakes demand, there is an artificial scarcity, which leads to temporary price increase. As a result, consumers either pay a high price to use the service or go in search of cheaper options that let the demand drop and correct the surge in price. 

Every time I tried to book an Ola or Uber in the last six months around peak hours both in morning and late evening, my enthusiasm and faith in using their services got tripped and I was shocked due to their surge pricing. 

Derail Smart City Objective

While Tamil Nadu has been a forerunner and an example for many other states when it comes to Public Distribution system, public transportation, etc. it has been anti-consumer with unregulated auto fares. It is not easy to travel in big cities like Chennai during peak hours due to lack of adequate and well-developed transportation network and lack of last mile connectivity. Especially, autos have gone unchecked for the last 40-years who operate without meters and only work on surge pricing. While many Governments have come and gone and despite the High Court order for fare regulation, enforcement remains a distant dream. Is this how we run smart cities?

Economic principles and government policies are against monopoly and cartels only on paper. As a result, cheaper alternatives like Share autos have mushroom in the city creating chaos, traffic issues and safety issues for citizens.

Protectionism vs. Favouritism 

Is economics more about anti-citizens policy and making the corporates richer by plundering the consumer? When I asked the Ola ans Uber drivers if the surge pricing charges gets passed on to them, their response was peanuts.

Some western countries like Germany and France, who strongly believe in regulating market forces, have banned Uber and similar services to protect the interests of traditional cab drivers at the cost of consumers. On the other India is cautious about foreign direct investment in retail, anti-competition and unwilling to let the market forces adjust the supply vs. demand has turned partially blind towards consumers, allowing day-light robbery in the name of protectionism. 

Governments across the world operate busses, trains, and aircrafts to ensure essential transportation services are affordable to commoners. The cash-starved Indian Railways 15 years ago introduced Tatkal pricing by selling some seats at a premium to make more money. And recently they've also introduced surge-pricing, yet another anti-consumer approach to compete with the unregulated Omni bus industry to stay profitable. Shouldn't efficiency be the focus and the tool to bring about profitability rather than fleecing the middle and lower-income group that travel by trains and busses?

Against Public Interest

Most of times surge-pricing is a trick employed by cab drivers and cab aggregators to create artificial scarcity by keeping cabs off road and charging more to book higher profit. This is termed as 'hoarding' in economics. We saw this economic term play up in the recent past with dal and onion prices going up the roof. Government of India raided warehouses and imported lentils to address scarcity and put an end to surge-pricing and act in the interest of larger public. Sometimes, when cartels and monopolies are operated by politicians or strong lobbies, nothing can be done. 

An Economic offence

How different is surge-pricing from insider trading? In insider trading the people close to the management or part of it have access to additional information that is used to trade shares and make big gains. Similarly, cab operators have access to peak traffic hours and keep cabs off the street to create artificial demand. May be it is high time we categorize surge-pricing as an economic offence and make it punishable?

All said and done, it is the duty of both state and central governments to keep the price of essential commodities checked and services affordable, regulated and be consumer friendly than act in favor of corporates. Though India may import business models from the West that has a higher percentage middle-class and additional income, while majority of India is still living in rural and just at or below the poverty line with no savings. 

The Tale of Two Nations

Though the economic success of a product or a service may be decided by supply and demand, but long-term success is decided by hard to earn good will and customer satisfaction. After having lived in three continents for a decade, I see both India and Europe having an identical approach to customer service.

3-years ago a fortnight after I moved into an furnished apartment in Paris the washing machine broke down. I immediately reported to the rental agency, who cooly asked me to endure the month of August without one. Should I start washing my clothes with my hands?

The agency told me that summer vacations are taken seriously and there is not a single soul around to come in and take a look. Instead they advised me to find a laundromat or an electrician/plumber to get the machine fixed. Should I be surprised to hear this kind of a response in a nation where customer service should be at the forefront of every business?

Summers can be equally challenging in India from scorching temperature, finding a cool vacation spot and getting a train ticket to travel. Though I managed to find an accommodation on the Queen of Hills, I couldn't get a train ticket and instead settled in for a sleeper bus to get there.

Having travelled on KPN Travels many times before, I didn't look else where for a ticket. Moreover, they had recently lunched a mobile application to provide customers with a swift and seamless experience. But did that swiftness and customer friendly experience show up at their facility, and during the travel?

A journey that was expected to be uneventful suddenly turned dangerous. 24 of us were woken up by a loud noise and a rude surprise at 2.20 am. It took a few minutes for the driver to realise what had happened. Quickly a co-passenger came around evacuating the bus. We didn't have time to question if it is a fire in the bus, a tire explosion or did the bus driver run over somebody? I jumped off my berth with my phone and wallet and disembarked the bus leaving my luggage behind.

NH45 was pitch dark and we didn't have a clue on our location. Women who had taken refuge in front of the bus that was lit by the powerful headlights and were comforting their wailing kids, while men folk were busy surveying the rear of the bus. A lorry smashed into the rear end of the bus smashing the glass windows leaving two elderly passengers covered with fine glass from head to toe.

It took a few minutes for the driver to fathom what had transpired and assess the damage. Bus driver confirmed the location; the nearest town was 30 kms away and none of the buses and cars that passed by were prepared to stop and ask if we needed help. Since the two elderly had minor bruises it was managed with the safety kit onboard the bus and there was no need for us to call the ambulance. Moreover, having no faith in our police, and collusion between bus owners and politicians we felt calling their head office in Salem to report the incident and asking them for an alternate transport was the best way out.

Finally, it took seven phone calls to get someone to answer us, but did that guarantee a solution?
One of us narrated the incident and the phone was passed on to the driver who hung up in a few minutes. Not sure what had transpired, anxious passengers grilled the driver  30-minutes turned into an hour and we didn't receive any call back from the head office.We tried calling back their headquarters, but weren't given a solution. With no solution in hand, we asked the driver to get us to the nearest town for us to find an alternative solution.

Finally, after a delay of 3 hours we reached Trichy at 6.15 am. The bus reached KPN office and the drivers were promptly swapped. We were asked to get off the bus, but don't hope they had an alternate transport in place.The bus cleaner was asked to clean up the glass pieces and we were put on the shoddily cleaned bus to our destination 5 hours away.

None of us were in a mood to protest for a few reasons. One, we were tired from a sleepless night. Two, we wanted leave Trichy at the earliest as it is a cauldron in summer. Lastly, all 24 of us wanted to reach our destination and enjoy our remaining time on the Queen of Hills, Kodaikanal.

3 hours after we had departed from Trichy, while still enroute to Kodaikanal, we all received a SMS from KPN. Could it be an apology or were they giving us a full-refund or a free-ride voucher? How about none of the above? An automated message with a google link to a feedback form was shared with us. We still hadn't reached our destination and our plead for an alternate bus had been dismissed and no apology was tendered by their staffs, yet they had audacity to send us a link to feedback form.

As much as France would like to preach Egalite, Liberte, Fraternite and India would like to brag about 'Athithi Devo Bhava" (treat guest with respect and love) and Incredible India slogan we Indians have no value for life and respect for customers. 
 

Though automated, at least a feedback form was shared with us, while the real estate agency in France never asked me for a feedback on their services. In this time and age, customer is no more the King in both these nations.

As much as economics talks about price fixing and overcharging from shortage of supply and excess demand, today I realised poor customer service never gets discussed or explained. Anyway, what would you have rated both countries for their rudeness, insensitivity, unapologetic behavior and poor customer service?

Summer of 2016

After a copious monsoon in 2015, I was prepared for a hot and humid summer, but certainly wasn’t ready to handle reunions that bring back warm memories and people from the past. Surprisingly, summer of 2016 turned out to be mild on the weather front, but very warm and sticky on the people front. 

 

A few weeks ago I connected with my college mates after a gap of twenty years and last weekend I met up with many of my first cousins after a long gap. I also ran into some relatives after a gap of 22 years. Do such reunions live beyond the initial euphoria and brouhaha? 

 

Pragmatist or Pessimist?

As much as I like to make memories and meet and connect with people, I also like review them from time to time. I don’t get into the mode of exchanging numbers or connecting with them on social media platforms. Summers of my life has taught me to explore sustainability of both new connections and renewing old connections than fantasizing a great friendship ahead or getting too high on nostalgia. Does that make me a pragmatist or a pessimist?

 

Despite taking a vow not to attend anymore weddings, I made an exception last weekend to attend the marriage of my last and youngest first cousin on my father's side. My absence from the wedding scene neither changed the atmosphere nor made me grow any fond of it.

 

Weddings and Political rallies

Weddings are also reunions of another kind. It brings family members and cousins who drifted apart for personal and professional reasons. Unlike weddings of yesteryears, weddings today resemble political rallies. Like politicians who visit your home before election seeking your vote, relatives come home seeking your participation. They often lure you with gifts to get you to attend their event and some even offer you transport and accommodation. And once you accept their bribes you are forced to show up to enjoy unlimited food, gossip, advice and entertainment. Not sure if you realize that by participating in the gossip they also end up offering their lives to be analyzed, assayed, and adjudged. As soon as the wedding is over, you are forgotten.

 

As much I stay away from political inclined individuals and rallies, I also stay away from marriages, evangelists who sell marriages and gossip mongers who pollute human minds with their contorted views of the world and individuals. 

 

Turning to Humor 

I turned cold feet and didn’t know what to expect as I hadn’t attended weddings in the last 4 years. But the recent mini-reunions with college mates in various cities help me get prepared. I rehearsed my lines and witty responses for people who walk up to me to give me their unsolicited opinions on my single hood and advices on how to lead my life.

 

For example, one of them was curious to know why I sported a bald look and I responded by saying that this was the easiest way to shine in life. My responses got funnier as questions got too personal.

 

What surprised me the most was when my immediate family made a decision on what I must wear for the wedding reception and someone who I met after 20 years at the wedding gave me unsolicited advice on personal grooming. Do I really look like someone who needs help or advice on what to wear and how to look? I never questioned anyone’s choice to stay single or married nor did I have an opinion on what they must wear or where they must go for their next vacation. Opinions are like assholes, everybody has one, but I keep mine clean and open it only when needed. 

Not Singled Out

If it thought I was being singled out at these reunions, you are mistaken. Married couple without kids were being taunted for not reproducing and divorced or widowed couples cringed and sat in a corner being afraid of attracting the attention of wagging tongues and loose cannons. 

Incredibly Indian

As much as Indian weddings are known for color, grandeur, fanfare and food, it is also a fertile petri dish for culturing gossip and conducting character (assass)inations. This society willfully approves violation of personal boundaries and individual privacy and choices. Should we be shocked at their behavior or should we accept this as a way of life and distinction of our Indianness?

I failed to understand why we Indians feel compelled to offer their uncalled-for opinions or find a need to concur with my views of life. As a society, why do we feel it is our moral responsibility and birth right to offer roadmaps for others lives and decide their negotiables and non-negotiables?

 

The Summer of 2016 made me realize that happiness in reunions be it with classmates or cousins evaporates very quickly turning the venue into court rooms that deliver judgments, tailor rooms that measures without tolerance and an altar that dispenses unsolicited advice.

Cynosure of All Eyes

The same question has been asked by various people across different age groups, genders, nationalities and in a variety of different tones ranging from that of concern and curiosity to validate their judgments and hunches. The last time I was asked this question outside the country was at the point of entry into the US by an immigration officer and again recently by my classmates who I had met after a gap of 20 years.

I always change my response based on their tone. I either duck the question or provide a canned, humorous or tangential response.  To the immigration officer in the US, I asked him if he was interested in me and to my classmate I told him that I couldn't find a single woman who was interested in me. Not sure if he found my answer humorous or ridiculous, but it put an end to the topic of marriage.

Most of them gave me a sympathetic look and left me under a pile of unsolicited advice, while some tried their conversion tactics including painting a gray scene of my lonely old age. Tired of such threats, advises, scrutiny and judgments, I began questioning their decision to get married, have kids and even went to the extent of asking them if they possessed the skills to play the role of a partner and a parent. Most answers were honest and they wanted to abide by the script laid out by the society.

Resist and Initiate Change

I recently shared my bitter experiences and the stupid logic offered by married folks to a colleague who is an expert in design thinking. He shared with me a paper titled “Changing the Status Quo written by H. William Dettmer” and used the evaporating cloud model proposed by Efrat to explain the psychology of happiness, security, satisfaction, adoption and more importantly why we resist/initiate change to explain why some stay single and many go with marriage.

He began to enlighten me by stating objective of life in a single sentence: to multiply or maintain our state of happiness.  As explained by the evaporating cloud concept by Goldratt in his paper, Dettmer says that happiness can be attained either through the satisfaction route or the security route. And this probably explains why some of us resist change and some of us initiate change. When I mapped the reasons given by most of my married friends, I could easily fit them into one of these categories and probably could explain why some continue to enjoy it or why some wiggled out of it without posing them with embarrassing questions.

The ominous bell curve

The ominous bell curve is used from birth to death to explain every aspect of our personal and professional life. I extrapolated Dettmer bell-curve to explain the adoption by various categories of people in society and how various marketing programs are put together to address those in the middle (early majority and late majority) of the curve. Though he didn’t point out my spot on the extreme, but I knew my place.

A symbiotic 3-way relationship

As a marketing professional, I paused for a couple of minutes to mentally list down various marketing programs that  I’ve launched to pitch and promote a product, service or a platform and also conversion program to attract those in the late majority and laggard categories. Amongst so many other things in life the institution of religion and marriage seem to have so much in common and propagate each other for their survival and hold a symbiotic relationship. Both of them seed an illusion in the minds of people and try to convert those in late majority and influence laggards. Yes, misery loves company. 

Mythology also offers you some good examples of conversions, for example Viswamitra who was focused on penance was converted by Menaka and she ended up marrying him and disturbed him from achieving his objective. There have been numerous occasions where I was courted by women colleagues and coerced by my male friends to get married; unlike Viswamitra, I remain steadfast, say like Bheeshma.

And today most governments support marriage and reproduction either directly or indirectly. Most state governments in India offer free gold mangalsutra to women and some political parties even sponsor mass marriages. Despite family courts overflowing with divorce cases and custody battles, marriages and irresponsible reproduction are on the increase. 

While Governments turn into parasite living off single people, religious institutions seek funds and patronage to hold their festivities to retain, reinforce, attract and convert people to their faith. Sometimes out of desperation, Governments, Religious institutions and those in wedlock loot exploit and loot each other to protect their interest, relevance and existence.

Conservative to Risk-averse: A gradual progression

William Dettmer in his research papers conveys that both early and late majority categories often borrow experiences from early adopters and laggards. And that also explains why some get converted and some remain committed to single-hood. Unfortunately, the world perceive single hood as an anomaly and often judge single people ruthlessly.

As I was getting ready to label myself as a complete risk-averse individual it struck me that I don’t always belong to this category. I got my first iPhone 7 years ago and then got a drone to engage in ariel photography two years ago when debates were still on to permit flying of drones.  May be my economic status and no barriers to exit explains my early adoption behavior with regards to technology?

When I look back at my life, I realize that I didn't start in the extreme right, but slowly moved from late majority to laggard category. The move happened as a result of learning that I borrowed from others and watching the world that goes by the popular script. I've also heard and seen early adopters and conservative risk-takers confess their mistake of saying “I do”. Sadly, the cost of exit is high when it comes to marriage and kids.

While married folks have reasons to celebrate their life, lifestyle and milestones, laggards (read as single) like me have none, but that doesn't mean we should become the cynosure of all eyes by attending such events. Over the years, I've made a conscious decision to boycott such events and stay away from all those who preach, profess and propagate marriage. 

Religion, Government and Marriage hasn't done much good to the society and despite the grim situation many us of are married or aspire to get married with a hope of conquering happiness. You can do more good to society by staying away from these evils. 

Be wise, stay single and happy!