Citi Bike's Better Angels How one bike-sharing company used behavioral economics to solve one of its most vexing problems.
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Citi Bike's Better Angels

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Citi Bike's Better Angels

Citi Bike's Better Angels

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STACEY VANEK SMITH, HOST:

Back in April, Joe Miller was feeling a little bit lost.

JOE MILLER: My entire city where I grew up just turned into this video game environment. It was just invading my subconscious, that - like, everywhere. It was in my dreams, and my sleep cycles were all off. I would just be dreaming about a map that wasn't there. And I'd have to wake up and convince myself that I wasn't actually looking at the map there. And it completely took over my life.

ETHAN BROOKS, HOST:

Joe is this, like, bearded, wild-looking dude. And when I met him, he had those shoes that wrap around individually each of your toes.

VANEK SMITH: The barefoot running shoes.

BROOKS: (Laughter) Yeah, those. And believe it or not, Joe is not talking about Pokemon Go. He's talking about his attempt to become New York City's top Bike Angel.

VANEK SMITH: There are about 40,000 Bike Angels in New York, and they work to improve the city's bike-share system. The Angels have a simple goal - balance the supply of Citi Bikes with demand from fellow riders. Turns out, though, that goal is not so simple. This is THE INDICATOR FROM PLANET MONEY. I am Stacey Vanek Smith.

BROOKS: And I'm Ethan Brooks. Today on the show, how the country's largest bike-share operator used behavioral economics, competition and community to pit its own customers against one of its largest challenges.

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BROOKS: For anyone who's unfamiliar with bike-sharing, here's a quick rundown. A bike-share system, or at least the type we're talking about today, is composed of bikes for rent that are kept at stations around a city. You can pick up a bike at one station, ride it to work or to a friend's place and then leave it at another. Pretty convenient way to get around.

VANEK SMITH: In New York, the name of the system is Citi Bike. And they're everywhere. And they're operated by this company called Motivate, which was recently acquired by Lyft.

BROOKS: And Motivate has a problem. It's called rebalancing.

VANEK SMITH: Rebalancing, as in no bikes. So here's the problem. If a station is full, no bikes can be returned to it. All the slots are full. And that is, like, costly and annoying for riders if you show up at a station, and there's no place to leave your bike. That is bad for business. And if a station is empty, obviously then no bikes can be taken out. No bikes can be paid for. And that is also really bad for business.

BROOKS: And this is a problem for every bike-share operator in existence. Because of factors like commuting patterns, weather and topography, there's a constant need for rebalancing. And there are a lot of ways to address it - you know, valets waiting at stations, pedicabs and trucks.

VANEK SMITH: Trucks - like, trucks will pick up bikes from full stations and bring them to empty stations. And one of the points of Citi Bike is, of course, that it's eco-friendly.

BROOKS: (Laughter).

VANEK SMITH: And when you start getting trucks driving the bikes around, it seems, like, not very green.

BROOKS: Not green at all. So Motivate decided to try out something different, and this is where the Bike Angels come in. If you're a normal Citi Bike rider, you use an app that shows all the stations in the city and how many bikes are at each station. But if you sign up to be a Bike Angel, that same map displays point values for each station. You can win points by taking bikes from crowded or neutral stations to empty ones. So at a super-high level, if you help rebalance the system, you win points.

COLLIN WALDOCH: We knew it was possible to improve the availability of bikes with just slightly nudging the behavior of riders themselves.

VANEK SMITH: This is Collin Waldoch. He is the program manager for the Bike Angels. So Collin and his team figured that if they could look at the behavior of the hundreds of thousands of riders in the system, then influence that behavior, they might be able to put a dent in this rebalancing problem - basically, somehow convince people to take a bike from a full station and ride it to a station that has no bikes without paying them for their time or labor.

BROOKS: The first and most basic of these slight nudges are rewards. An annual Citi Bike membership costs 169 bucks. So if you get 80 points in a month, you get a free month of membership.

VANEK SMITH: Which is worth, like, 14 bucks.

BROOKS: Yeah.

VANEK SMITH: It's not nothing.

BROOKS: It's not nothing. So with enough points, you're pretty much earning a self-sustaining membership in exchange for changing your behavior.

VANEK SMITH: But Motivate did not want to leave it there. Collin had studied economics in college. And he figured the best way to turn regular riders into Bike Angels would be to try out some ideas from behavioral economics.

BROOKS: Right. So for the uninitiated, that's a subfield of economics that incorporates insights from psychology. It helps explain why individuals make different decisions in economic contexts. This whole rebalancing problem's about individual behavior, so it made sense to apply that theory to this problem. The first thing they did was recognize that most Angels view rebalancing as a prosocial behavior.

VANEK SMITH: Prosocial is, like, for the masses?

BROOKS: It's, like, a positive social action that maintains the well-being of others.

VANEK SMITH: Like recycling.

BROOKS: Like recycling.

VANEK SMITH: Prosocial.

WALDOCH: The best-feeling part of being Bike Angel is literally bringing a bike to an empty station, and someone was waiting there for a bike. And so the idea there is let's lean into that little. Let's say, hey, as a Bike Angel, you are helping fellow riders. You're helping your neighbor. You're improving the balance in your system.

VANEK SMITH: And to keep encouraging these warm and fuzzy feelings, Motivate looked to another idea from behavioral economics. It's called social comparison. So this is the idea that people are more likely to engage in prosocial behavior or do what you want them to do if they can see that others are doing it too.

So on top of these feel-good community messaging, they meet a public-facing leaderboard, a little bit like the list of initials in a video game. And that way, the top 10 Angels could see how their points were stacking up against the other top Angels.

BROOKS: They also created a status symbol, a special white Citi Bike key to be awarded to Angels who hit 500 points. The regular keys, they're blue.

VANEK SMITH: So Bike Angels launched in April of last year. Now, as a reminder, 80 points is what gets you a free month of membership. After that, you make 10 cents per point, so not tons of money. Angels will typically get around three to five points per ride. So 80 points is around 20 rides. Collin thought some of the more avid Angels would probably hit 500 points - you know, like a hundred rides - within six months.

BROOKS: But that 500-point mark got beaten in three weeks.

WALDOCH: It was a complete surprise. And it's kind of funny now to look back and think 500 points in a month was mind-boggling because people regularly are in the thousands now.

VANEK SMITH: Thousands of points. That's, like, hundreds of rides. These people are, like, running all over the city. They must be in really good shape.

BROOKS: Incredible shape.

VANEK SMITH: This totally unexpected class of riders had emerged. And the monthly point record as of today?

WALDOCH: I know this one by heart. The points record for a month is 8,888 points. And it was by the all-time Bike Angel king, Joe Miller.

VANEK SMITH: Joe Miller, our guy, our Bike Angel king.

BROOKS: (Laughter).

MILLER: You might say I have sort of, like, a comical amount of endurance or energy. And so I'm always looking for outlets for that. And then, also in the back of my mind, like, oh, I'm doing a good thing here. This is benefiting the system.

BROOKS: But for Joe, Motivate's slight nudges felt more like a shove off of a cliff.

MILLER: I'm just someone of - who - someone who's played video games his entire life. And certain games can grab hold of me. And I wanted to see what my life would look like trying to get to the top of this leaderboard.

VANEK SMITH: And it didn't take long for Joe to find out. It took Joe just nine days to get to third place for September. And in December, he got 4,444 points.

MILLER: Just a stupid arbitrary number. It's four fours. It's cute.

VANEK SMITH: And when April came around, Joe set out to double the previous record.

MILLER: Midnight, April 1, I positioned myself in the Upper West Side. Clock struck midnight. I took a bike out of the station and just started working. And I worked for about two hours. I was in this very weird headspace, very obsessive. I almost had a nervous breakdown toward the end of the month.

BROOKS: To be clear, Joe is not a typical Bike Angel. In fact, he may be the most extreme case. But according to Collin, there are between 500 and 1,000 Bike Angels in the system who go above that 80-point free-month-of-membership threshold every single month. That's 500 to 1,000 people rebalancing Citi Bikes for reasons beyond financial incentives.

VANEK SMITH: Right. Because if you remember, there is a financial incentive after 80 points, but it's so tiny, it's kind of ridiculous. It's, like, 10 cents per point. So for Joe's banner month of 8,888 points, he made around $1,000. And that's, like - that's not nothing.

BROOKS: Not bad.

VANEK SMITH: A thousand dollars is, like, rent money. But that was earned over hundreds of hours moving bikes. And that works out to way less than minimum wage for way more work than most of us do.

BROOKS: So this raises an interesting question, right? The rebalancing by these top Angels clearly benefits Motivate's business in one way or another. A lot of people would consider that work.

VANEK SMITH: Work that a big company is getting basically for free.

BROOKS: (Laughter) But for the top Angels, it's just not. You know, Joe was drawn in by the gameplay and for the competition on the leaderboard. For a lot of others, it's a form of exercise. And some people do it out of a sense of altruism. But in the end, the choice to go above 80 points is just that - it's a choice.

VANEK SMITH: Collins says, today, the Bike Angels are responsible for about 30 percent of the rebalancing that takes place. For the rest, they still use trucks and pedicabs and valets. Motivate has also expanded this program to other cities around the country.

BROOKS: And as for Joe, he still picks up points here and there, still rides a little bit. But after his big month, you know, he's decided to step back. And he does not look at the leaderboard anymore.

VANEK SMITH: Take that, behavioral economics.

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CARDIFF GARCIA, BYLINE: This episode of THE INDICATOR was produced by Darius Rafieyan and edited by Paddy Hirsch. THE INDICATOR is a production of NPR.

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