According to UP folks, there are 4 barriers to UP building ridership....fares being #4...
A truly independant board would respond to this with...."I will not approve you taking the easy way out....if your research is right, get off your butts, do the hard work and correct those perceptions rather than beg for a price reduction to make your goal of building ridership easy"
Well, maybe a Trump style Board (there are plenty of those) would do that. A more insightful Board would ask, "was there evidence that you were fooling yourselves all along?"
Barrier 1 - (Awareness) Where's the evidence that you tried? It's clear the travel publications - Fodors, Lonely Planet, etc - didn't rush out to put UP in their writeups on Toronto. How many Travel editors were contacted? How many writeups provided to key travel publications? How many articles achieved in foreign trade press? How many mentions in foreign newspapers? The warning signs of problems here would have been apparent 12 months or more ago.
Barrier 2 - (Navigating) We note that you employed lots of expensive supposedly 'expert' consultants on signage, etc. What happened? (to digress - I walked the UP route at Union Station today. The signage from UP to the city is a lot bigger and better than the signage from the subway to UP. Still looking for more universal airplane logos....we are fooling ourselves if we think that the TTC or GO logos are as universally understood as, say, the London Underground logo. Let alone the UP logo.)
Barrier 3 - (Price Perception) - there's a lot of psych literature about the "just noticeable difference". Did you think that pricing UP slightly under the 2-person limo price would be enough of a differential to trigger the "just noticeable" difference? Why didn't you offer a ridiculously cheap fare as the loss leader, with a clever plan to ratchet it upwards as ridership grew? Show me a business model that has implemented the full-margin fare as the starting position.....most new offerings are given away for a song for the first while......would Hyundai or KIA have offered their (very impressive) autos by setting the starting prices at BMW levels?
Barrier 4 - (Changing habits) - see Barrier 3 - did you really think people would say, "Oh, yeah....Presto card.....just like Oyster Card......" without asking "I can use it on the bus, can't I?" What was the evidence, by the way? You did market research - what percentage of central Toronto commuters knew what a Presto card was when you started your service? What percentage had already used airport rail in Paris, London, Rome, Oslo?
- Paul
