The MT Position

Posted by Fred Jandt
Editor, Mass Transit

It’s a week before the Super Bowl (next Tuesday) and the rhetoric is already flying fast and furious. On the NFC (Republican) side you have allegations of dirty tricks being leveled and on the AFC (Democrat) side you have a locker room that’s fallen apart as its two leaders take to sniping at each other. Meanwhile the Commissioner (President) stepped up to the mic and made his State of the Union Address.

I like having the State of the Union during that week off between the NFL Divisional Championship games and the Super Bowl. It gives you something to focus on other than the minutia that the sports media scrutinizes for five days. And really, how much like the NFL is the political spectrum these days.

The presidential election playoffs are in full swing with several teams dropping out in the last week and the remaining candidates are making their last minute game plans. So how is the league these days?

Well, when it comes to transit, it is like being the fan of a team in the playoffs. Take for example this line from President Bush:

“To keep our economy growing, we also need reliable supplies of affordable, environmentally responsible energy….And my budget provides strong funding for leading-edge technology…”

(Waves pennant.) Whoo!

There you go, he’s talking about transit. What better way is there to showcase affordable, environmentally responsible energy? Think of the gas savings by riding transit! And the greenhouse gases that will be cut! And no other industry is leading the way with alternative fuels as much as transit!

“…from hydrogen-fueled cars, to clean coal, to renewable sources such as ethanol.”

(Lowers pennant.) Oh.

So I guess he’s still talking about cars. But what about last year’s whole discussion on America’s addiction to foreign oil. Remember this from last year:

“It is in our vital interest to diversify America’s energy supply — and the way forward is through technology. We must continue changing the way America generates electric power — by even greater use of clean coal technology…solar and wind energy…and clean, safe nuclear power. We need to press on with battery research for plug-in and hybrid vehicles, and expand the use of clean diesel vehicles and biodiesel fuel. We must continue investing in new methods of producing ethanol — using everything from wood chips, to grasses, to agricultural wastes.”

Hrm. Hybrid vehicles? Check. Clean diesel? Check. Bidodiesel? Check.

Last year as I watched the State of the Union I was waiting for the President to mention public transit. So much of the speech revolved around America’s burgeoning energy crisis and transit seemed a logical part of the solution. Of course, he didn’t mention it.

Now think back since the last State of the Union and all that happened. The escalating gas prices. The I-35 bridge collapse. The National Surface Transportation Commission’s report that basically said we need infrastructure assistance at every level.

And this year’s State of the Union didn’t mention public transit … again.

It’s not a matter of why didn’t the President mention it; it’s more along the lines of how couldn’t he.

Thanks for reading the MT Position updated every Friday,

Fred
fred.jandt@cygnusb2b.com

Posted by Fred Jandt
Editor, Mass Transit

Sometimes we get caught in a rut, especially when things work…well, at least work fairly well. The last week has been full of stories of people breaking out of the rut and looking at new ways of doing business.

Apple was the first one to catch my eye. While not necessarily a new business model, their iTunes model is interesting. Basically, they aren’t looking at iTunes to necessarily make money; all they need it to do is break even. The idea here is that iTunes sales will spark interest in and sales of iPods and Macs. It’s hard not to have iTunes on your Mac or PC and not think about investing in an iPod to bring it with you.

Another example came out this week from Electronic Arts (EA). Faced with rampant piracy of its games in South Korea a few years ago, EA decided to give one of its most popular games, FIFA soccer, away free online. Instead of game sales, revenue would be generated from micro-purchases of various in-game upgrades. Not only was it successful, it was so successful that EA is planning on expanding the format to games in the United States and Europe, with even more on the horizon.

Pulling this back to transit, a story came out on Thursday of a study on eliminating fares for New York City transit. The fare revenue would be replaced by increased congestion pricing — double what Mayor Bloomberg had previously proposed. According to the study this is a viable option, the basis being that increasing the cost to drive significantly by offering a free alternative in transit would cause a surge in ridership.

Free transit seems to be the buzz word lately. Portland residents vehemently opposed the idea of charging fares overnight on Tri-Met’s MAX trains in Fareless Square. And the recent funding bill in Illinois includes a provision for free fares for seniors in the Chicago area thanks to a last-minute addendum by the governor.

Would free transit increase ridership? I’m not sure. You hear transit being cheaper than driving listed as one of its benefits. Would taking that to the next level (i.e. free) overcome that last argument by people who love their cars? And what if they did? You might end up with the proverbial be careful what you wish for. Too many riders is a good problem to have, but disgruntled riders because of crammed trains and buses isn’t what any agency wants.

Now how about that micro-purchase format from EA. How about free rides, but you have to pay to access the Wi-Fi on your bus or train? Or perhaps that “quiet car” on the rail line requires a small charge to get access to. There are innumerable things to charge riders for on a transit system. Of course, that’s what people complain about on airlines, having to pay for so many different things — of course they’ve never discussed reducing ticket prices, let alone giving anything away free.

Could transit be free in more areas than it is? Yes, but the riders may also want to be careful what they wish for, because they may just not like what they get in the process.

Thanks for reading the MT Position updated every Friday,

Fred
fred.jandt@cygnusb2b.com

Fred

Marketers need to be agents of change, and effective change agents must be risk takers too. How about you? What risks did you take last year? What risks are you planning to take this year? How will the risks you take advance the reputation and ridership success of your transit organization?

About ten years ago, the transit system I worked for needed to build ridership and one of the key components of the plan was a television campaign built around a commercial called “My Name Is Eric”. The commercial showed a man sitting down with a group of people in a church basement. His opening line was, “Hello. My name is Eric…and I drive a car”. While the rest of the spot extolled the benefits of riding the bus versus driving, the support group portrayal was seen as too realistic by recovering alcoholics, especially one who happened to be a prominent local congressman. After three weeks of complaints, we pulled the spot. Ironically, a few weeks after it was pulled, it won an award from Advertising Age Magazine.

My boss at the time was quite understanding. In fact, he had challenged me and our ad agency to be edgy. But sometime risks aren’t as much about being edgy as they are about pursuing a big bold idea. And more often than not, big bold ideas are found at the intersection of risk and innovation.

A few years ago, after realizing that my organization had the ability and opportunity to identify a large portion of our riders, we started planning for a relationship or loyalty marketing program. The development costs were not insignificant, but we figured the program, once up and running could be sustained for much less than what a typical mass media campaign would cost. Within three years we had signed up over 20,000 participants as well as a number of promotional partners who created added value offers for our riders.

In this case, the effort didn’t result in any awards, but it did reward us with an effective ongoing way to stay close to our customer base at a time of service cuts, fare increases and budget reductions. It was an important priority to retain as many riders as possible under the circumstances, and our loyalty program gave us a highly personalized way to do so.

It was a risk born from a bold idea. You might say it was the right risk at the right time. And speaking of the right time, isn’t NOW a good time to go forward with that bold but risky idea that makes sense for your organization?

Keep the thread going by sharing a story that relates to your experience with taking marketing related risks. Let me hear from you!

Joe Caruso is Senior Consultant for Brecon Hill Consulting. He’s the former marketing director for the Milwaukee County Transit System (WI) and has over 32 years of transit marketing experience. He welcomes your comments at jcaruso@breconhill.com.

Posted by Fred Jandt
Editor, Mass Transit

Yep, Doomsday is looming over the transit industry again, and this time we’re not talking about Chicago — as surprising as that may seem. Sure, Chicago’s deadline for massive service cuts and fare increases is this Sunday, but it doesn’t look like the legislature is going to waiver on passing a funding bill this time around. With any luck, while Bears fans curse the Packers for being in the NFC Championship game Sunday night, they will breathe a little easier knowing they have a familiar bus or train to work in the morning.

No, this time I am talking about the impending Amtrak strike. Sure, many of us west of the Appalachians have little to do with Amtrak, but in the Northeast Corridor, it’s vital to its transportation infrastructure.

Let’s put aside the image of Amtrak being a long-haul interstate rail system — the Greyhound of rail if you will. Most people don’t realize that in many parts of the country, Amtrak is a highly successful commuting option in larger cities. Right in my backyard, Amtrak operates a successful line between Milwaukee and Chicago that I have used on several occasions. For the people along that line it is just as important as if Metra were to stop running trains due to a “doomsday.”

Let’s get back to the Northeast Corridor for a minute. About a year ago I visited NJ Transit and toured its system. And what a system it is. I saw more of that state when I was out there for a couple days than when I lived near New Jersey years ago.

Amtrak is an essential part of its system, helping to ferry multitudes into New York City everyday. The train lines dispatched by Amtrak that NJ Transit runs its trains on would be off-limits should a strike happen. Rough estimates I gathered looking on the Internet said this would shutdown about half of NJ Transit trains, cancelling more than 200,000 daily trips.

Remember the strike in New York City a few years ago? This would be nearly as bad. Take New York Penn Station for example. Amtrak controls all the tracks going through it. A strike would shut that station down. Penn Station — closed.

It’s odd that this strike hasn’t gotten more press before this. It’s not like there hasn’t been time to discuss it, the unions’ (nine of them total) contracts expired in 1999 and a new agreement hasn’t been reached yet. That’s almost eight years of work from these people without a contract and no service disruption due to a strike. The President stepped in at the end of last year, creating a panel that concluded that the workers needed about a 35 percent increase in pay with retroactive pay back to 2000 for some of them.

Amtrak’s response? That would cause them to be $150 million in the red for its 2008 budget. Seeing how Chicago’s transit agencies are struggling with budget cuts, I can see how difficult filling a hole like that is, but my sympathy ends there. They had eight years to come up with a resolution for this — eight years! And nothing was done.

If our infrastructure is crumbling as quickly as experts say it is, and if an intercity rail system is needed, then Amtrak needs to get shaped up — and quickly. There will be no support from the general public if this is what they look to as an example of intercity rail.

John Inglish, UTA general manager, told me that crisis motivates change, not good ideas. For all the good ideas the National Surface Transportation Policy and Revenue Study Commission came up with this week, it may take Amtrak shutting down or another worse crisis for people to start believing what they are telling us.

Thanks for reading the MT Position updated every Friday,

Fred
fred.jandt@cygnusb2b.com

Posted by Fred Jandt
Editor, Mass Transit

I was in Washington, D.C., earlier this week and while visiting my parents last weekend they pleaded with me to take a taxi from the airport, or as my father intoned, “Always take a taxi.”

Why? Well I was coming into D.C. late on Monday night and my parents didn’t think that a train ride was safe at night from the airport to my hotel. Let me point something out here. This wisdom wasn’t imparted on me from the voice of experience — far from it in fact. Neither of my parents has ever been to Washington, D.C., and they probably have never rode on a subway, let alone a light rail line.

Growing up outside of a small town in Western Wisconsin the closest thing my parents had to any sort of public transit was what they watched on TV. So for them to give me advice on transit safety seemed absurd in the least.

But the impression is still there. It’s kind of like the impression of buses being dirty, black, cloud-belching monstrosities. Transit isn’t safe after dark. Train stations are the domain of vagrants and ne’er-do-wells and if you are at a bus stop after dark you are either causing trouble or looking for it.

Of course, like the image of a bus belching black smoke, the truth when it comes to transit safety is often the opposite of what the public image is. As I walked up to the Metro station near my hotel, there were two Metro Transit Police officers standing there in case of trouble. And as I stood on the platform waiting for my train back to the airport, I saw several Metro staffers walking the platform.

And let’s talk about that station and platform a bit. Both were better lit than a lot of the streets above. If I were in trouble, I would probably head for a train station instead of running from it.

Again, transit has to do what so many other companies and organizations do not. They not only have to provide great service at a reasonable cost, but they must also overcome decades of misinformation and ingrained imagery to prove that they aren’t what people think they are.

Thanks for reading the MT Position,
Fred
fred.jandt@cygnusb2b.com

Posted by Fred Jandt
Editor, Mass Transit

I procrastinate on things. I am sure my wife has a list of things she has asked me to do that I have to get around to doing. I would wager most people reading this have procrastinated on something at one time or another. Who hasn’t? But there’s procrastination and then there is being ridiculous.

What did Chicago-area residents get for New Year’s? Another impending “doomsday” from its transit providers. It’s not like this is a surprise or anything, though, this present has been sitting under the tree for some time now.

The doomsday set for January 20^th will see drastic cuts in service and increased fares from CTA with similar steps taken by PACE and Metra. All of this revolves around a lack of funding for transit.

Now here is the thing. This transit bill has been bouncing around Springfield for months. There have been several “doomsdays” already, each narrowly avoided by a sudden influx in cash. While this has saved transit service so far, it has had two disastrous effects. First, every time the date gets pushed back a little bit, the cuts needed to make up the pending shortfall get larger. And, probably even worse is the fact that the public has become numb to the whole situation.

It’s almost the boy that cried wolf, but instead there actually is a wolf here, it just keeps getting run off before anyone gets to see it. That begs the question, will it take an actual transit doomsday to get the funding CTA, Pace and Metra need to keep their service at appropriate levels?

So now we sit in the first week in January. A vote on the situation won’t likely come until January 9^th, the next scheduled legislative session. That puts the situation 11 days out from doomsday. Let’s take out weekends and that puts it at about seven days. Seven days to come to terms on a transit funding bill that has been argued about since last summer.

Will it happen? Probably, but the thing is it never should have come down to the wire like this. This whole situation just smacks of politicians gambling with constituents livelihoods to see what they can get before reluctantly coming to a compromise when their time comes up.

Not necessarily the smartest thing to do going into an election year.

Thanks for reading the MT Position, and Happy New Year!

Fred
fred.jandt@cygnusb2b.com

Posted by Debbie Dauenhauer
Executive Director, SNTC

The Southern Nevada Transit Coalition (SNTC) is a 501C3 organization established in 2002, that provides public, senior, paratransit and medical transportation to residents and visitors in 10 rural southern Nevada communities. The SNTC operates under the brand name “Silver Rider.” System wide, the SNTC provides more than 550,000 rides each year, making the SNTC the largest provider of rural transit in the state of Nevada.