2. Rail Industry Overview Once the primary form of transportation 1950âs-70âs 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
3. Amtrak Overview Also known as the National Railroad Passenger Passenger 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 (Bostonï DC) Over 26 Million Passengers a Year Mainly in the Northeast Corridor/West Coast Lines
4. 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
5. 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, changing consumer Position themselves as the âsafer, greener, healthierâ long distance travel option
6. 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
7. Strategic Elements Tangible Aspects Tracks and trains Train stations Presentation of employees Webpage Ticket
8. Strategic Elements Target Markets Serves three specific markets: Business, leisure, and student travelers Issue: Amtrak never attempted or have been able to clearly define their target market(s) and their attributes and needs Certain aspects of their service targeted towards market segments Acela Express = business class Student Advantage Card = college students Amtrakâs service can be used by anyone Allowed ability to market to specific niche go to waste
9. 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 each other Location, trains bring you closer to your ultimate destination Reliability, can run under more severe weather conditions
10. 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 effective advertising Minimal advertising attempts, âadvertise at people not to themâ(Direct Magazine) Recently with new image (safer, greener, healthier) creating more effective advertisements to showcase their new positioning strategy
11. 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
12. 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 capital improvements 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
15. Pricing Strategy Non Existent Attempts to extract as much from passengers as the city-pairs, time of year, and accommodations selected will allow Variety of Seating Options Tier Pricing Limited Promotions No Direct Rail Competitor=No Price Wars Pressure from non-rail competitors
17. 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
18. 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
19. 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
20. Long Range Outlook Positive Federal Funding Stimulus Package Improving/New Technology New Services Convenience
21. Wise Investment? Not Publically Traded Only Major Passenger Rail Service Federally Backed New Technologies Possible Going Public Option? Increase in Capital Accountability
Hinweis der Redaktion
Tangible AspectsTracks and trainsInterior, exterior, amenitiesWooden and concrete tiesTrain stationsAvailability of space, cleanliness, comfort and design, layout, signs, temporal attributes (music), amenities offeredPresentation of employeesCrisp uniforms and well kept appearances of conductors, front-line staff, other employeesWebpageTicket
Target MarketsServes three specific markets: Business, leisure, and student travelersIssue: Amtrak never attempted or have been able to clearly define their target market(s) and their attributes and needsCertain aspects of their service targeted towards market segmentsAcela Express = business classStudent Advantage Card = college studentsAmtrakâs service can be used by anyoneAllowed ability to market to specific niche go to waste
Promotional/Advertising StrategyNo promotional mix because of no target marketPromotions offeredStudent Advantage Discount CardVeterans Advantage Discount CardInternational Student Identity CardAAA Membership CardNational Association of Railroad Passengers discountsDiscounted prices on cruise lines they are partnered withLarge market share from the start, no need for effective advertisingMinimal advertising attempts, âadvertise at people not to themâ(Direct Magazine)Recently with new image (safer, greener, healthier) creating more effective advertisements to showcase their new positioning strategy
Efficiency of Services (short term profitability)TimelinessSharing of tracks with freightsChange laws to be stricter, allow for more dispatch priority for AmtrakInfrastructureWooden vs. concrete tiesHigh speed rail marketNew, upcoming marketCustomer Relationship ManagementClearly define target market, better able to tailor servicesDirect messaging systemUpdated technologies in train stations for retrieval of passenger information
Employees/Employee CommunicationLargest expense is employee salaries, wages, benefitsChange manual processes to be electronic, save moneyLong Term ProfitabilityPublic TradingRevenue generated from stock used for funding capital improvementsHold Amtrak accountable to shareholdersHold company to highest standards Keep all internal and external processes consistentAdvertising StrategyNew campaigns highlighting their differential advantages to draw in new customersNew strategy would be expensive, but profitable in long run because it would increase their customer base
