Marketing Transit Services to Business (1998) / Chapter Skim
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Chapter 2
Chapter 2
Pages 27-56
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From page 27... ...
TI,at said, there are still differences between business-to-business marketing and consumer marketing that need to be considered. Taxis chapter starts by summarizing some of the differences between business-tobusiness marketing and consumer marketing, and the resulting implications for a transit-to-business marketing program.
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From page 28... ...
This makes it important to design an effective marketing campaign at the level of complexity that properly describes the product being marketed. Business Buyers We!
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From page 29... ...
This increased need for coordination and integration requires a different set of skills for business-to-business marketers, and requires that they take a different view of the marketing process. While the above differences in business-to-business marketing and consumer marketing are generic, they do have important implications for transit-tobusiness marketing programs: Transit-to-business marketing cannot be baser!
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From page 30... ...
A= Overview The marketing process incorporates most of the activities in an organization. The process includes the following: Goal setting and understanding the business strategy · Understanding the customer Product or service development Market analysis Development of a marketing plan Service or product delivery Evaluation and refinement These components may not always be present when an agency develops a marketing program, and they may occur in different sequences.
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The following sections describe the steps of the marketing process in more detail. goal Setting and Understanding the Business Strategy Establishing a realistic set of goals is the first step in developing an effective marketing program.
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Market Analysis t~°r~ T; Develop Am/ Marketing Plan Based upon the "Marketing Process Cycle" from Paul Sherlock, Rethinking Business to Business Marketing, Maxwell McMilIan International, New York, ~ 99 I, p S
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From page 33... ...
These influences start with customer needs, but also take into consideration organizational goals, organizational capacities and capabilities, competitors' and potential partnerships. An 0ffect~v0 marketing campaign requir0$ more than good research and the optimum market mix; SUCC0$S also is 10~0rm~nell by the cigar identification of a transit system's goals and obJ0ctIves.
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From page 34... ...
As noted above, business-to-business marketing will require more customization than does consumer-based marketing. Finally, in developing a product or service, an organization needs to be aware of the external environment, including potential laws or regulatory changes, partnerships which can assist with a product or service, and the existence and capability of competitors.
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5 · The perl$habRib of services means they cannot be stored for future sale. If a transit agency does not operate on a Tuesday, they cannot make up for the lost day on Wednesday.
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Knowing the customer means knowing existing customers as well as potential customers. It means knowing the needs of particular market segments that are being targeted, and being able to offer the customization required to meet these needs.
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campaigns.~° In practice, market segmentation divides the market into different groups that square common characteristics; these commonalties increase the likelihood that the group will p nd to the same type of marketing campaign 11942~43 M k t is as useful for transit-to-business marketing as it is for consumer marketing. A recent TCRP project investigated the benefits of market segmentation in the transit industry, and summarized them as follows: "Designing respon$iv0 products to mw' the needs of ~e marketplaoe.
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From page 38... ...
For example, members of a technical writing professional group could be targeted for a technical dictionary.45 Transit marketing to employees of a business or students at a university are examples of affinity market segmentation. · Damographios- Information such as age, income, education level, family size, location, sales volume, number of employees, and ownership situation can provide a wealth of information about who might be interested in different products.
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From page 39... ...
Often it is most effective to target the easiest market firsts in other words, to "pick the low-hanging fruit." customer TraekIn~ An important part of understanding the customer is tracking customer use of services and customer satisfaction, and confirming that a target marketing campaign is reaching its target. Good, reliable information about customers also allows for more precise market segmentation.
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Databases - In the context of direct marketing, databases differ from data banks in that the different files are linked together by the computer. This linkage makes it possible to process and cross-reference files together, generating more comprehensive business customer records.
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Because of the complicated nature of databases and the information contained in them, they are usually only maintained by producers rather than being rented or sold by independent brokers. In general, databases have increased the scope and quality of market segmentation, creating more effective marketing campaigns at a lower 11 cost.
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) Target Customers and Market Segmentation Why Customers Would Choose Current Market Share and Potential Market Share Description of Competition Marketing Objectives for the Organization/Unit Marketing Objectives for the Service or Product Marketing Strategy B
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From page 43... ...
The marketing plan provides the opportunity to lay out the strategy for involving employers as a way of "moving," the service of public transportation from the producer (usually transit agencies) to consumers through their employers.
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A relevant transit example of this consideration was when a chairman of a large transit authority refused to approve fare increases because he wanted transit to dominate tile automobile mode on at least the price dimension. Service Delivery Once a detailed marketing plan has been developed, the next step in the marketing process (shown in Figure 2-1)
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From page 45... ...
More generally, in any marketing program, directing effort to revealing and incorporating lessons learned in early phases can be critical to success in subsequent phases. Measures of EffectIveness One important part of the measures of effectiveness for a marketing program would be the envisioned milestones for all key program elements.
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From page 46... ...
Given the large role that customer and business satisfaction plays in determining success with transit-to-business marketing efforts, it is I,ard to overstate the overall importance of the evaluation and follow-through functions. Overview Marketers employ a number of different techniques to promote a product, including the use of paid advertising, personal selling and direct sales, sales promotions, publicity and public relations, and partnership.
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From page 47... ...
and telemarketing to snake initial contact and to provide clients with snore follow-up information, while the use of business databases to segment the market and to target potential customers has been particularly effective. Organizations also use newsletters, informational pamphlets, and special promotional activities first to service companies, then to keep participating companies informed.
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From page 48... ...
Direct marketing can be used to develop contacts into qualified sales leads, which can then be pursued by the field sales staff. The direct marketing sales effort provides general information and direction to potential customers, while the field sales personnel give more in-depth information and demonstrations, and actually complete the sale.
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From page 49... ...
· PBliBl~ D~k$ - Postcard decks are mailed packages made up of promotional postcards for a number of products distributed by one or more companies. These provide exposure for a company's product at a lower cost than solo direct mail, because the mailing costs are shared between a number of different parties.43 Postcard decks can be particularly effective when the different products being promoted are related in some way.
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Private businesses routinely use sales staff to sell their products or services to other businesses. In particular, a dedicated sales force can be very helpful for fostering interest in a service and for explaining the finer and more complex points of a program.
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As the principal point of contact between the business community and the transit agency, the sales agencies must be familiar with the range of transit products available to the business community - from service hours to fare media. Product Benefits.
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As described earlier, organizations with greater resources tend to have a dedicated sales staff, usually known as "account representatives" or "account executives." This type of staff is usually in charge of all sales contact with potential customers, ranging from the initial mailing or phone call through to the decision to participate. Once an employer has agreed to participate in the program, the sales force will act as a general resource, answering questions, organizing events, and keeping employers aware of new developments through regular mailings and phone calls.
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A transit promotion could include things such as a free day pass provided as part of a "try transit" program or participation in employer benefit fairs or transportation fairs. The following are considerations in developing a sales promotion effort: Design of ~e Offer In doing a promotion, the objective is to get potential customers to respond to an offer of some kind.
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From page 54... ...
A well-designed fulfillment package should provide a strong sell for the product, and provide an easy reply mechanism for prospects who need further information or wish to start the process of making a purchase. To support and maintain interest in the product being marketed, the inquiry fulfillment package must also be sent out quickly after a request is received.
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From page 55... ...
Publicity and Public R0IatI0n~ Publicity describes promotional venues such as news stories, editorials, and word-of-mouth, while public relations are press releases and news conferences planned to influence customers' attitudes or opinions towards the product and its producer. Both of these promotional activities help develop awareness of the product, and make potential customers more receptive to other marketing information that they will receive.
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From page 56... ...
Even though transit is relatively new to business marketing, a number of transit agencies have utilized the basics of marketing theory to generate effective marketing plans for services like ridesharing, employee passes, and transit vouchers. The following chapter extends the discussion of marketing theory into transit marketing specifically, anti offers examples of the types of approaches and techniques most often used to target tile business customer ire this environment.
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