Customer Loyalty Management for Occasional Rides



Customer Loyalty Management for Occasional Rides

Authors

F Bretzger, Probst & Consorten, DE

Description

In the last years the liberalisation of public transport led to extensive efforts of transport companies to improve their economic situation by focusing on revenue management besides cost reductions programs.

Abstract

In the last years the liberalisation of public transport led to extensive efforts of transport companies to improve their economic situation by focusing on revenue management besides cost reductions programs. Important elements are strategies and measures for customer loyalty management. To extend customer relationships fluctuation of customers has to be reduced and new customers have to be acquired.
At present, there is a differentiation between strategies and measures of pricing, distribution and communication for regular customers (especially monthly pass subscribers) and for occasional riders. Thus a customer service according to the frequency of use of occasional riders is rarely possible. Due to increasing needs and a higher motorization an intensified use of cars is the consequence. For this purpose successful efforts by the automobile industry concerning young people and women are important factors.
In order to tackle these problems, it is indispensable for public transport companies to increase their efforts about occasional riders. These customers must be bound to public transport - surely on a lower usage level than the regular customers - by suitable measures. Thus a further decrease of public transport usage by this important and, if its share of population is considered, largest customer group can be prevented.
As it is shown in practice, today customer relationship management (CRM) is implemented only to a very limited extent in the public transport industry. Applications of the so-called analytic CRM are at present not in active use. In many cases the technical facilities for data collection of accurate user behaviour are missing. Furthermore present forms of market surveys and observations give only an insufficient idea about occasional riders. It should be emphasised that CRM does not only stand for the employment of information technology. It is rather a holistic approach for the management and attitude towards customers.

In the described project an analysis of occasional rider's user behaviour was accomplished for the first time. This quantitative analysis took advantage of smart card-data of the "GeldKarte" in Hanover. The analysis focuses on methods of analytic CRM in order to identify starting points to increase customer retention of occasional riders.
The paper finally recommends a migration path in order to develop today's pricing and distribution systems towards an electronic ticketing

Publisher

Association for European Transport