We keep hearing that the railway is short of money, but have we made the most of the commercial opportunities in front of us?
Are we making the most of our amazing station infrastructure?
I’m getting a little tired of hearing that the UK rail industry has big financial issues, particularly post pandemic. Whilst I understand that cost pressures continue to bite, I do think that the sector has lost some of its commercial nous in the past decade. There seems to be a lack of appetite to seek out small initiatives at the margins that could in totality make a difference in generating revenue. Here are a few areas where a bit of creativity and focus could help the industry.
Taxi permits
Taxi permits at railway stations are at the bottom of the pile of priorities within a train company. Permits are sold to drivers enabling them to ply their trade on the rank of their allotted station. However, station managers are too busy dealing with facilities, managing staff and helping customers to be dragged into the admin of collecting revenue for taxi permits or to see the importance of taxis on ranks outside their station. However, when disruption ensues there will be a need for motivated taxi drivers. There is also no science behind the cost of a permit or taking into account local market needs. Many stations have the potential to create ranks and generate revenue through taxi permits. I know a company, CMAC Group, which has processes to manage taxi permits for train companies, generating revenue for the sector and better arrangements for taxis at stations that drive an improved experience for customers.
Last week I travelled on every Inter City TOC and not only was the appearance of a trolley few and far between, when they did arrive not on one single occasion did they sell savoury food
Catering
It’s getting worse. Last week I travelled on every Inter City TOC and not only was the appearance of a trolley few and far between, when they did arrive not on one single occasion did they sell savoury food. Whilst my diet consists of coke, crisps and sweets, I do accept I am extraordinary as most folk like sustenance – a sarnie, salad or something. Surely with a bit more imagination, better stock control and more orientation around ensuring a trolley is on every train and not just the minority, then some decent dosh from nosh could be generated?
Revenue protection
There are some TOCs that do this well – Northern staffs gates well into the small hours and at outlying locations. But there are others, generally the south commuter TOCs, where a revenue protection presence, particularly away from the core network, is almost as non existent as an on-board sandwich.
Advertising revenue
I have always had a premise that if you have an outward facing marketing tool or display, then there is an opportunity to flog it for advertising. Take a walk around any railway station and there are literally countless walls and display areas where even a few quid from local business would be better than nothing and would create a sense of vibrant, progressive community engagement and a thriving economy and station environment.
Tenancy
Stations are attractive propositions – they have decent footfall and are centrally located with good facilities on premises. Since staffing levels were gradually reduced over the previous three decades and in particular as management functions have taken on a larger geographical region, there are many redundant station offices that are prime for regeneration and occupancy in return for rent. The problem is that the industry has never had a proper strategy to exploit these opportunities. The days of a local station manager being encouraged to use commercial and entrepreneurial nous, or their station being regarded as a ‘profit centre’ or ‘business unit’, are long gone.
Backs of seats
It always surprises me how moribund the interior of trains are, despite them being a space in which a captive audience of customers are confined for several hours. This is where the brand police are foolish and should acquiesce and enable commercial logic to take over enabling a mix of third party advertising on seatbacks as well as TOC led marketing to encourage days out and destinations. The problem is that many TOCs are so precious about their brands they are missing opportunities. And let’s be brutally honest, it’s not as if their brands have much resonance with the UK population or could be described as ‘much loved’.
I remember back in the day at Midland Mainline, the complimentary First Class offering cost less than 30p a head yet customers responded to it with such a glow
Gifts and goodies
It never ceases to surprise me how gullible us customers are. We love little frills in First Class, a chocolate bar, tiny can of lemonade or packet of peanuts as though we are being treated to a life of luxury. I remember back in the day at Midland Mainline, the complimentary First Class offering cost less than 30p a head yet customers responded to it with such a glow. With a bit of imagination and little cost, a product that pampers could be created and upsold very easily to a receptive market. Unfortunately, the industry has long since lost its sense of imagination.
Excursions
I know this might sound like me being nostalgic and harking back to the era of football specials, but I genuinely feel there would be demand for a nationwide excursions business or proposition, for concerts, sporting events or other days out activities. Folk keep telling me the financials won’t stack up or there isn’t track access available. However, with all this frenzied activity around developing open access opportunities, I think deep down there is capacity and the beauty of excursions are that, with decent marketing, you can kind of plan with reasonable certainty that they will sell out if the destination is popular. Cynically I think there is a it’s all too much hassle mentality among rail industry folk that prevents this ever seeing light of day or a fixation with thinking that an excursion has to be either a rail enthusiast’s tour to some obscure disused freight line or involve a luxury dining service or steam service, with all the costly complications that come with this.
Rail enthusiasts
Do you remember when the railway had a fanbase the envy of many a sporting team? Across whole generations, a ritual of a passion for trains was handed down by parents to their children. From travelling on the railway just for the thrill of it, to collecting memorabilia or numbers and photos, apart from those sectors set up purely to provide entertainment, no other sector had such a following of fans. Can you imagine supermarkets, financial institutions, construction businesses or energy providers having enthusiasts who devoted all their leisure time to following them? The problem is that the rail industry turned its nose up at these folk – rail enthusiasts were, apart from the odd exception, no longer provided with open days and excursions and exhibitions and there were no marketing campaigns targeting them to travel to explore interesting places. Those who enjoyed standing on the ends of platforms were no longer welcome and in some cases treated with rank hostility. It seems a far cry from F.A. Cup Final day in 1989, when 20,000 shunned the TV at home to come to Ilford Depot Open Day in the sun. It was one of the greatest days of my life, in truth, and I still think that with considered marketing, enthusiasm and innovation, this market can be reinvigorated making a bit of revenue for the industry, as well as creating a future generation that loves the railway and wants to travel on it.
Gifts
In the digital era, a tangible souvenir of a trip out is actually more appreciated than ever before. A postcard, cuddly toy, fridge magnet, guide book or replica model of the train goes a long way to creating and marking an occasion, as well as keeping kids, in particular, active on a long journey. Like those freebies in First Class, they don’t cost a lot of money and such gifts could be retailed at a fair price but one which would generate a new source of revenue.
Imagine having a wedding, party or corporate event on St Pancras, York, Windsor & Eton or Newcastle station, to name but a few of the wonderful stations throughout the nation?
Hospitality
Many of our railway stations are truly amazing in terms of ambience and architecture and are set in the heart of fantastic places in the UK. It’s hard to find an industry that has such a range of incredible buildings better located in towns, villages and cities than stations. The heritage, modernity, culture and atmosphere oozed by these stations is like nothing else and the industry has an opportunity to host not only tours of some of its locations, showcasing the history and workings of the station, but also hospitality events and conferences either on quieter days or in parts of the premises that are little or not used. Imagine having a wedding, party or corporate event on St Pancras, York, Windsor & Eton or Newcastle station, to name but a few of the wonderful stations throughout the nation?
Railcards
Over the past few years, advertising of rail products on railway stations and through other channels has declined significantly, with railcards sometimes being the only proposition deemed worthy of advertising. All very well, you might think, except that there has been a tendency just to lump identical posters and leaflets next to each other, such that customers have become blasé and are not actually taking in their content. Railway staff do little to promote them, there’s seldom a compelling campaign across the network or in the media to encourage those who don’t travel by rail to do so affordably by purchasing a railcard or compel existing rail customers to tell a friend. I recently stumbled across close family and friends showing off about reaching 60 and being eligible for a Senior Citizen’s Railcard and being completely oblivious that they could have, for their entire adult life to date, benefited from a Network Railcard and enjoyed a third off leisure travel.
Gift vouchers
I don’t know about you, but every Christmas and birthday, I always struggle to think of presents to buy loved ones. Generally, it now comes down to a gift card or voucher for Costa Coffee, X-Box, Odeon or Waterstones. In return, I get all excited by a voucher for the Addlestone Model Railway Shop. Imagine, my joy if there was such a concept as a gift card or voucher for use on Britain’s railway. What a practical and exciting present that would make for someone who always agonises about treating themself to an expensive journey for leisure purposes. I’m sure the marketing wizards would have real fun dreaming up a campaign to sell the benefits of a present of rail travel to somewhere scenic or a great destination – a romantic trip out by train as an anniversary or Valentine’s present, perhaps, or just the gift of being able to getaway. It’s a no-brainer! .
ABOUT THE AUTHOR: Alex Warner has over 30 years’ experience in the transport sector, having held senior roles on a multi-modal basis across the sector. He is co-founder of recruitment business Lost Group and transport consultancy AJW Experience Group (which includes Great Scenic Journeys). He is also chair of West Midlands Grand Rail Collaboration and chair of Surrey FA.
This story appears inside the latest issue of Passenger Transport.
Revenue raising ruses to rescue rail
by Passenger Transport on May 16, 2024 • 1:33 pm No CommentsWe keep hearing that the railway is short of money, but have we made the most of the commercial opportunities in front of us?
I’m getting a little tired of hearing that the UK rail industry has big financial issues, particularly post pandemic. Whilst I understand that cost pressures continue to bite, I do think that the sector has lost some of its commercial nous in the past decade. There seems to be a lack of appetite to seek out small initiatives at the margins that could in totality make a difference in generating revenue. Here are a few areas where a bit of creativity and focus could help the industry.
Taxi permits
Taxi permits at railway stations are at the bottom of the pile of priorities within a train company. Permits are sold to drivers enabling them to ply their trade on the rank of their allotted station. However, station managers are too busy dealing with facilities, managing staff and helping customers to be dragged into the admin of collecting revenue for taxi permits or to see the importance of taxis on ranks outside their station. However, when disruption ensues there will be a need for motivated taxi drivers. There is also no science behind the cost of a permit or taking into account local market needs. Many stations have the potential to create ranks and generate revenue through taxi permits. I know a company, CMAC Group, which has processes to manage taxi permits for train companies, generating revenue for the sector and better arrangements for taxis at stations that drive an improved experience for customers.
Catering
It’s getting worse. Last week I travelled on every Inter City TOC and not only was the appearance of a trolley few and far between, when they did arrive not on one single occasion did they sell savoury food. Whilst my diet consists of coke, crisps and sweets, I do accept I am extraordinary as most folk like sustenance – a sarnie, salad or something. Surely with a bit more imagination, better stock control and more orientation around ensuring a trolley is on every train and not just the minority, then some decent dosh from nosh could be generated?
Revenue protection
There are some TOCs that do this well – Northern staffs gates well into the small hours and at outlying locations. But there are others, generally the south commuter TOCs, where a revenue protection presence, particularly away from the core network, is almost as non existent as an on-board sandwich.
Advertising revenue
I have always had a premise that if you have an outward facing marketing tool or display, then there is an opportunity to flog it for advertising. Take a walk around any railway station and there are literally countless walls and display areas where even a few quid from local business would be better than nothing and would create a sense of vibrant, progressive community engagement and a thriving economy and station environment.
Tenancy
Stations are attractive propositions – they have decent footfall and are centrally located with good facilities on premises. Since staffing levels were gradually reduced over the previous three decades and in particular as management functions have taken on a larger geographical region, there are many redundant station offices that are prime for regeneration and occupancy in return for rent. The problem is that the industry has never had a proper strategy to exploit these opportunities. The days of a local station manager being encouraged to use commercial and entrepreneurial nous, or their station being regarded as a ‘profit centre’ or ‘business unit’, are long gone.
Backs of seats
It always surprises me how moribund the interior of trains are, despite them being a space in which a captive audience of customers are confined for several hours. This is where the brand police are foolish and should acquiesce and enable commercial logic to take over enabling a mix of third party advertising on seatbacks as well as TOC led marketing to encourage days out and destinations. The problem is that many TOCs are so precious about their brands they are missing opportunities. And let’s be brutally honest, it’s not as if their brands have much resonance with the UK population or could be described as ‘much loved’.
Gifts and goodies
It never ceases to surprise me how gullible us customers are. We love little frills in First Class, a chocolate bar, tiny can of lemonade or packet of peanuts as though we are being treated to a life of luxury. I remember back in the day at Midland Mainline, the complimentary First Class offering cost less than 30p a head yet customers responded to it with such a glow. With a bit of imagination and little cost, a product that pampers could be created and upsold very easily to a receptive market. Unfortunately, the industry has long since lost its sense of imagination.
Excursions
I know this might sound like me being nostalgic and harking back to the era of football specials, but I genuinely feel there would be demand for a nationwide excursions business or proposition, for concerts, sporting events or other days out activities. Folk keep telling me the financials won’t stack up or there isn’t track access available. However, with all this frenzied activity around developing open access opportunities, I think deep down there is capacity and the beauty of excursions are that, with decent marketing, you can kind of plan with reasonable certainty that they will sell out if the destination is popular. Cynically I think there is a it’s all too much hassle mentality among rail industry folk that prevents this ever seeing light of day or a fixation with thinking that an excursion has to be either a rail enthusiast’s tour to some obscure disused freight line or involve a luxury dining service or steam service, with all the costly complications that come with this.
Rail enthusiasts
Do you remember when the railway had a fanbase the envy of many a sporting team? Across whole generations, a ritual of a passion for trains was handed down by parents to their children. From travelling on the railway just for the thrill of it, to collecting memorabilia or numbers and photos, apart from those sectors set up purely to provide entertainment, no other sector had such a following of fans. Can you imagine supermarkets, financial institutions, construction businesses or energy providers having enthusiasts who devoted all their leisure time to following them? The problem is that the rail industry turned its nose up at these folk – rail enthusiasts were, apart from the odd exception, no longer provided with open days and excursions and exhibitions and there were no marketing campaigns targeting them to travel to explore interesting places. Those who enjoyed standing on the ends of platforms were no longer welcome and in some cases treated with rank hostility. It seems a far cry from F.A. Cup Final day in 1989, when 20,000 shunned the TV at home to come to Ilford Depot Open Day in the sun. It was one of the greatest days of my life, in truth, and I still think that with considered marketing, enthusiasm and innovation, this market can be reinvigorated making a bit of revenue for the industry, as well as creating a future generation that loves the railway and wants to travel on it.
Gifts
In the digital era, a tangible souvenir of a trip out is actually more appreciated than ever before. A postcard, cuddly toy, fridge magnet, guide book or replica model of the train goes a long way to creating and marking an occasion, as well as keeping kids, in particular, active on a long journey. Like those freebies in First Class, they don’t cost a lot of money and such gifts could be retailed at a fair price but one which would generate a new source of revenue.
Hospitality
Many of our railway stations are truly amazing in terms of ambience and architecture and are set in the heart of fantastic places in the UK. It’s hard to find an industry that has such a range of incredible buildings better located in towns, villages and cities than stations. The heritage, modernity, culture and atmosphere oozed by these stations is like nothing else and the industry has an opportunity to host not only tours of some of its locations, showcasing the history and workings of the station, but also hospitality events and conferences either on quieter days or in parts of the premises that are little or not used. Imagine having a wedding, party or corporate event on St Pancras, York, Windsor & Eton or Newcastle station, to name but a few of the wonderful stations throughout the nation?
Railcards
Over the past few years, advertising of rail products on railway stations and through other channels has declined significantly, with railcards sometimes being the only proposition deemed worthy of advertising. All very well, you might think, except that there has been a tendency just to lump identical posters and leaflets next to each other, such that customers have become blasé and are not actually taking in their content. Railway staff do little to promote them, there’s seldom a compelling campaign across the network or in the media to encourage those who don’t travel by rail to do so affordably by purchasing a railcard or compel existing rail customers to tell a friend. I recently stumbled across close family and friends showing off about reaching 60 and being eligible for a Senior Citizen’s Railcard and being completely oblivious that they could have, for their entire adult life to date, benefited from a Network Railcard and enjoyed a third off leisure travel.
Gift vouchers
I don’t know about you, but every Christmas and birthday, I always struggle to think of presents to buy loved ones. Generally, it now comes down to a gift card or voucher for Costa Coffee, X-Box, Odeon or Waterstones. In return, I get all excited by a voucher for the Addlestone Model Railway Shop. Imagine, my joy if there was such a concept as a gift card or voucher for use on Britain’s railway. What a practical and exciting present that would make for someone who always agonises about treating themself to an expensive journey for leisure purposes. I’m sure the marketing wizards would have real fun dreaming up a campaign to sell the benefits of a present of rail travel to somewhere scenic or a great destination – a romantic trip out by train as an anniversary or Valentine’s present, perhaps, or just the gift of being able to getaway. It’s a no-brainer! .
ABOUT THE AUTHOR: Alex Warner has over 30 years’ experience in the transport sector, having held senior roles on a multi-modal basis across the sector. He is co-founder of recruitment business Lost Group and transport consultancy AJW Experience Group (which includes Great Scenic Journeys). He is also chair of West Midlands Grand Rail Collaboration and chair of Surrey FA.
This story appears inside the latest issue of Passenger Transport.
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