amtrak presentation ds;kdjkndfopgjsdo psep[gt p[sbodjvgjop ajeop jzopjopzdnfklgbnmxfcklbxcjfopj...
DESCRIPTION
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5/27/2018 amtrak presentation ds;kdjkndfopgjsdo psep[gt p[sbodjvgjop ajeop jzopjopzdnfklgbnmxfcklbxcjfopj ghodjrophjdoph - sl...
Service Marketing Project
Josh Haber, Michael Piscadlo, Brittany Tomkiewicz
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Rail Industry Overview
Once the primary form of transportation 1950s-70s
Shift to personal transportation/air travel
1970
U.S. Government creates Amtrak
Present Day
No other major rail passenger line competitors
Tracks mainly owned/used by freight transporters
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Amtrak Overview
Also known as the National Railroad PassengerPassenger Corporation
Created by Congress in 1970 Began Operations in 1971
19,000 Employees
Own 469 Locomotives/1,519 Passenger Cars Run Over 300 trains a day
Over 500 stations
21, 000 train route miles in 46 states
Owns 80% of the Northeast Corridor (BostonDC)
Over 26 Million Passengers a Year Mainly in the Northeast Corridor/West Coast Lines
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Services Offered
Variety of Routes Long Distance, Commuter Routes, Regional Routes, High
Speed Rail.
High Speed Rail
Acela Express on Northeast Corridor Only Variety of Seating Options
First Class, Business Class, Sleeper Service, and Coach
Operates 14 long distance routes across the country
Service 23 States
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Strategic Elements
Positioning Reputation Issues
Solid market share from the start
Able to obtain a consistent ridership
Only major provider of passenger rail Never had to put effort into positioning themselves in the
consumer mind
Changing times, changing economic situation, changingconsumer
Position themselves as the safer, greener, healthier long
distance travel option
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Strategic Elements
Image Series of ups and downs
More negative in past several years
Slacking timeliness, inflated prices, declining customer
service = bad company image New approach
Connecting America in a safer, healthier, greener way
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Strategic Elements
Tangible Aspects Tracks and trains
Train stations
Presentation of employees
Webpage Ticket
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Strategic Elements
Target Markets Serves three specific markets:
Business, leisure, and student travelers
Issue:
Amtrak never attempted or have been able to clearly definetheir target market(s) and their attributes and needs
Certain aspects of their service targeted towards marketsegments
Acela Express = business class
Student Advantage Card = college students
Amtraks service can be used by anyone
Allowed ability to market to specific niche go to waste
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Strategic Elements
Differential Advantage Compared to Cars
No stress, can have a leisurely journey
Time, can get from Point A to Point B quicker
Risk, car accidents less prevalent than train accidents
Compared to Airlines
Accessibility, more locations to board an Amtrak train
Time, can buy a ticket and board a train within minutes of eachother
Location, trains bring you closer to your ultimate destination Reliability, can run under more severe weather conditions
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Strategic Elements
Promotional/Advertising Strategy No promotional mix because of no target market
Promotions offered
Student Advantage Discount Card
Veterans Advantage Discount Card
International Student Identity Card
AAA Membership Card
Large market share from the start, no need for effectiveadvertising
Minimal advertising attempts, advertise at people not to
them(Direct Magazine)
Recently with new image (safer, greener, healthier) creatingmore effective advertisements to showcase their newpositioning strategy
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Prospects for Profitability
Efficiency of Services (short term profitability) Timeliness
Sharing of tracks with freights
Infrastructure
High speed rail market
Customer Relationship Management
Clearly define target market, better able to tailor services
Direct messaging system
Updated technologies in train stations for retrieval of passenger
information
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Prospects for Profitability
Employees/Employee Communication
Largest expense is employee salaries, wages, benefits
Long Term Profitability
Public Trading
Revenue generated from stock used for funding capitalimprovements
Hold Amtrak accountable to shareholders
Advertising Strategy
New campaigns highlighting their differential advantages to
draw in new customers New strategy would be expensive, but profitable in long run
because it would increase their customer base
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Competitors
Speed overdistance
EnvironmentallySound
Price
Convenience
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Competitors
Speed overdistance
Price
Comfort
Safe
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Pricing Strategy
Non Existent Attempts to extract as much from passengers as the city-
pairs, time of year, and accommodations selected willallow Variety of Seating Options
Tier Pricing Limited Promotions
No Direct Rail Competitor=No Price Wars
Pressure from non-rail competitors
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Customer Blueprint
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SWOT
Strengths Dominance in the marketplace
Unique service offering
Convenience in locations, local stops
Flexibility in scheduling, numerous trains on the same day
Pricing Weaknesses
Pricing Strategy
Product Offering
Financial Limitations
Target Market Segmenting
Infrastructure
Bad Image
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SWOT
Opportunities USP-Unique Selling Proposition-more destinations, more
frequently, more affordable etc. Pricing Strategy-steep discounts targeted at niche markets Ridership increases Federal Funding
Privatization Threats
Discount Airlines Discount Busses Automobile Travel Private Train Firms Economic Condition Federal Funding Loss
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What do they do well?
Alternative option instead of flying Eliminate airline taxes, delays, cancellations
Low costs traveling across country
$200 for one way
Improving their services Wi-Fi, Free Drinks
Making travel easy for short regional distances
Security
Photo ID, Low Profile Target
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Long Range Outlook
Positive Federal Funding
Stimulus Package
Improving/New Technology
New Services Convenience
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Wise Investment?
Not Publically Traded Only Major Passenger Rail Service
Federally Backed
New Technologies
Possible Going Public Option? Increase in Capital
Accountability