Sunday, May 14, 2006

Government makes call on PT marketing

An article in today's 'Age' says that the State Government is planning to launch a telemarketing campaign to encourage more people to use public transport. The general idea is that cold-calling telemarketers will phone residents of selected inner suburbs. People that express interest will receive written information about public transport near them.

Most Australians value their home life and despise telemarketers. However I can see why marketing experts decide to use them. It's all to do with 'targeted marketing', 'qualifying the customer' and even 'bang for buck'.

Consider an area with 1000 homes to market to.

* Option A:
No phone calls, no telemarketing.
Send 1000 brochures/maps to 1000 houses (junk mail).
Total cost: $1000

800 thrown in bin, 100 already existing PT users, make no use of info, 100 potential PT users and make use of info.

* Option B:
Make 1000 random calls at a total cost of $300.
800 hang up/refuse. 200 request brochures, etc.
200 info packs sent out - cost $200.
100 of those 200 make use of this info.

** Costs (for 100 used info packs in both cases)

A: $1000
B: $500 (so you could double the reach for the cost of A)

** Effectiveness

A: 10% of recipients use it ($10 cost per user)
B: 50% of recipients use it ($5 cost per user)>p> So B the telemarketing option is cheaper per user, wastes less paper and has much higher effectiveness through targeting and qualifying customers.

In short, B is 'smart marketing' and the powers that be are convinced that this is the case so they give the go-ahead.

The big problem is that the call interrupts the lives of 800 people and provides no benefit in return. Ardent drivers, non-English speakers and people for whom public transport is impractical are examples. Most critically, it includes those would be receptive to hearing about public transport if delivered via a less intrusive medium (eg direct mail), but hate being telemarketed to. So our 100 could well shrink to 50, most of whom could fall in the 'don't mind telemarketers' group rather than 'want info on public transport', which is the prime audience. Marshall Macluan's maxim that 'the medium is the message' could be applicable, and in the case of telemarketing it is not particularly positive and risks bringing the product down with it.

For people less knowledgeable about public transport, written information gives greater confidence and is more enduring than a phone call. If it's useful (like the folding Metlink PT map, but with service running times & frequency info added) then people will keep it. It will be regarded more a community notice and less as an advertising flyer, so should be accepted even by those with a 'No Junk Mail' sticker. Due to its longer-term usefulness and greater reach (including the 'hang up on telemarketers' brigade) the 'random junk mail' approach still has attractions when promoting public transport, despite the inefficiencies mentioned above.

Any direct marketing campaign can expect to do is to encourage people to take the next step. This could be getting further information and/or buying a ticket, but not necessarily catching a bus just yet.

Before the direct marketing starts, the 'next steps' must be sound, otherwise the prospective user will fall into a hole. In this context, this means things like:

a. confining the marketing effort to areas within 1km of 'good' or 'recently upgraded' public transport
b. a workable online trip planner (substantially complete)
c. and on-system information like bus timetables/maps at stops & stations (substantially incomplete)

Paying attention to these before starting the campaign is likely to greatly increase its effectiveness, whether it's done by telemarketing or junk mail.

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