Subscribe
Share
Share
Embed
Welcome to the Rail Technology Magazine Podcast. Keeping you up-to-date with the most current rail industry news, giving you an all-access pass to the key insights and innovations helmed by the decision makers in our industry
Transcript
00:00:01
We've expanded the availability of advanced fares.
00:00:05
We've really dug.
00:00:06
In to finding out why people are commuting, most importantly why people aren't commuting, what the triggers would be to help encourage them to come back when the societal changes are happening, rail is a huge.
00:00:21
Vital and really interesting sector to be involved in. I really love being involved in the rough sex and at the same time.
00:00:27
It sometimes feels like it's large enough to be its own ecosystem.
00:00:32
This is the rail Technology Magazine podcast, bringing your views, insight and conversation from leaders across the rail industry presented by Richard Wilcock.
00:00:40
On today's episode of the Rail Technology Magazine podcast, we welcome Alicia Andrews, the commercial director for Southeastern Railways. Thank you for joining me today. So as the commercial director at a rail operator.
00:00:48
Thank you very much, Richard.
00:00:52
Can you tell me a?
00:00:53
Little bit more about what that entails. Certainly on a day-to-day perspective anyway.
00:00:57
It's very different with different operators, so I.
00:01:00
When you really talk to what it means in my world, I am accountable for everything to do with fares, ticketing and retail, and that includes the digital. I'm accountable for marketing, customer experience, customer insight, all things to do with customer strategy and customer experience, but in different operators, there are different mixes. My experience of commercial director as a title.
00:01:20
It's very variable, but this is the role that I've performed and I've performed similar roles in other organisations before, so it's really broad and it's quite exciting from that point of view. So it moves from everything to designing piece market research, looking at an advertising campaign.
00:01:37
Thinking about provision for accessible travel to what should we be doing in terms of future fares and future digital service provision?
00:01:48
So you just touched on now actually a little bit more about about future fares and and and sort of provision for ticketing and for accessibility, one of the elements at the moment and one of the the discussion points at the moment is that the industry is very cost.
00:02:02
Even, and that's quite true for operators. How do you make sure that revenue generation is is kind of not drowned out when we're all talking about cost cutting and making sure that we're saving money rather than spending money on on innovation?
00:02:17
In terms of ticketing.
00:02:19
You and I, and and everyone who's listening to this, our ultimately through our taxes subsidising the UK railway and that's always been true to an extent and it's an important part of our society to have a functioning public transport. But it's never been a larger proportion than it is today.
00:02:35
Only way that that's going to decrease as a burden is by recovering revenue.
00:02:40
Transport any form of transport has what economists call lumpy costs. I'm sure you know about this. You know, we have to lay on a train. It's a it's a big, expensive thing. It has to use very expensive track. Therefore, the game is all about making sure the maximum number of people travel.
00:02:55
On it and to me, the other really important aspect of encouraging journeys and passengers back to the railway is not just the revenue, but it's actually the modal shift to the reduction in carbon intensive travel in this country and the really important change that access to transport can bring to people to help them.
00:03:16
Change their life chances, change their life experiences.
00:03:19
In that instance, then, when we talk about ticketing and and sort of the cost of rail travel, that's kind of affected the perception of public and obviously we want to get people onto.
00:03:29
Great. And you know recently we just saw that TfL and and new on the ground had had recently hit pre pandemic levels of ridership. So the latest data from 2021 I'd noticed saw just under 3/4 believe that train fares in the United Kingdom were either fairly bad or very bad value. So how does a talk like yourself?
00:03:50
Tackle that and how do you keep costs where you want them to be? Basically because I know that's a difficult thing.
00:03:56
So keeping costs where we would like them to be, I think fundamentally comes down to looking at customers and looking at customer segmentation and looking at the services that our people can deliver. Our colleagues who work on the frontline, who work on trains and in stations deliver fabulous customer service.
00:04:13
Yeah, it's a question of how we make sure that that service is really appreciated by our customers and those that need it. And when we go into all sorts of different.
00:04:22
Commercial and retail experiences now, there are times when we want advice, we want assistance, and there are times when many people, not everybody, is very happy to self-serve and get on with it themselves, whether they're buying a ticket, whether they're looking for information. So we are looking at segmenting customer experiences, help for those that need it and great.
00:04:42
Health service for those that don't, and obviously for those that are very happy to self-serve, that helps us drive down the cost of sale, drive down the the way in which we absorb subsidy to provide that ticketing aspect.
00:04:56
You were talking earlier about the actual price of rail tickets, and I'm not surprised by the stat that you've talked about. It's a, you know, it's a disappointing, potentially somewhat shameful stat.
00:05:07
I think some of that arises and this is well covered in the plan for rail through confusion. There are so many different ticket types out there with different restrictions and there is a big variation between peak pricing and the cheapest advance fares.
00:05:24
And the the best headline is always made by the expensive season ticket and the expensive peak there. And so sometimes in the media it gets simplified down to that, but I'm not. I'm not going to stand here or sit here and say.
00:05:36
All rail pricing is is perfect. You know we've got a number of different things that we've been doing at Southeastern since the pandemic coming up right to now we've expanded.
00:05:46
The availability of advanced fares in order to make it more affordable for people to travel, we've expanded the time in which people can book advanced fares up until midnight the day before, and we've introduced them onto many more new routes. And now we are about 8 rail periods through a flex C season trial, where we've partnered with.
00:06:08
BRT with the DfT and are the first and only talks so far to use the Treasurer's First Trials fund to test better value flexi seasons on our route. To make it consistent price proposition.
00:06:22
So that if you travel on South Eastern, it's it's very simple, isn't it? You know, it's what, what? Lots of wildflowers do as a.
00:06:27
Standard, but yeah.
00:06:28
What we're doing with flexi seasons is we have made them always the best value. If you're commuting three days a week and we are seeing and it's being evaluated by third parties with the DfT, not not by our own kind of analysis.
00:06:42
Exclusively, we're seeing growth in revenue growth and take up, which is you know it's great because this is helping people get to work. Maybe for some people it's helping people get back into work.
00:06:53
There is a purpose in actually driving people or encouraging people to use public transport, but there's also a purpose in reducing the revenue and the the subsidy that's taken in order to run the railway.
00:07:07
Recognising, as I said earlier, it's it's a public service at the end of the day it exists to create mobility for people.
00:07:14
So you mentioned.
00:07:15
There in terms of the sort.
00:07:17
Of the flexi ticketing that you've been introducing I.
00:07:20
Assume you're talking.
00:07:21
Here about sort of tap in tap out that has been sort of rolled out. How successful has that been and would you like to see something more like that, you know, do you see that the way the forward?
00:07:34
That's what passengers want.
00:07:35
The flexi season is actually running the trial we're running runs on the existing flexi season ticket, which was set up in September 2021.
00:07:45
That's the one where you get 8 passes. You can use them over 8 day passes. You can use them over 28 days and our trial is very simple. It was consciously designed to be really quite straightforward, so it didn't have to disrupt the back end technology. It could be run discretely on our part of the network and it runs. It runs digitally.
00:07:49
Right.
00:08:05
And that it's available on an itso card on what Southeastern calls the key card. It's not a tap in, tap out.
00:08:12
But I think it's a really interesting topic to talk about how tap in tap out can work.
00:08:19
I think what people want is a really easy form factor. I'm not. I'm deliberately not talking about tap in, tap out they they want a really easy digital form factor for most people, not for everybody. As I said, some people don't want that and they want then the flexibility to consume what they use. But they also want clarity and simplicity.
00:08:39
And for some people, the best deal is going to be a purchase upfront, cheap ticket. You know, we we do that in lots of other parts of our life. Most people do that with their mobile phone. They buy a monthly contract. They know how many minutes and texts they're going to get and how much data they're going to get. And they use that.
00:08:56
And that simplicity of purchase decision is helpful. Installing infrastructure everywhere across the UK in order to provide a formal tap in tap out.
00:09:10
In my view, is probably not.
00:09:13
The first solution that I would choose because we now live in a world where more and more we're using georeference services. Why could we not be using a service where actually there's a georeference perimeter? You don't need lots of solid-state equipment or equipment with moving parts in it even.
00:09:31
The railway has an enormous amount of this equipment.
00:09:34
And I said this coming from originally outside the railway, I've I've only been in the railway for, you know.
00:09:39
Under five years.
00:09:41
All these things with moving parts that have to plug into Daisy cables that have to have power supplies that have to have screens are extraordinarily expensive to maintain.
00:09:52
And don't always lead to great customer experiences. We're not leveraging, you know, we're not taking that kind of how do we leapfrog forward opportunity as often as we could, I think.
00:10:02
You mentioned there about leaping forward.
00:10:04
And and I guess that's just.
00:10:07
Being a little bit braver in terms of.
00:10:08
Nation obviously it just as an operator itself. How important is is collaborating with the industry itself and the and the, the the bodies that that kind of control the industry. So I'm thinking you know Network Rail, LGBT, how important is the collaboration with these bodies to to ensure that innovation can keep pushing forward so we can get the.
00:10:29
Best value for money for passengers?
00:10:31
I think it's important on two principle dimensions. Firstly, it's important because by collaborating you bump into people. You have conversations, they spark off ideas, things that you haven't taken into account, that diversity of thought, that diversity of experience.
00:10:47
I think is incredibly important to any innovation and actually some of.
00:10:50
The most left.
00:10:51
Field things and some of the things even that you might discard just might help you refine your idea. And I think it's important because it's part of the ambition to bring together the railway and certainly that's the way we're approaching it.
00:11:06
We talked about the flexi season. We're working in really close collaboration with GBR T and with other talks and we've presented the results to all of the talk commercial directors just to say this is how it's going.
00:11:19
And we're aware that other people would like to run trials and we would definitely like to hear about those trials and we also work really closely within the DHL group with NR, Northern and TPE. And we share our ideas and we really benefit, I think from not only our geographic diversity, but also the diversity of the way in which we operate.
00:11:39
And so being open to all of those different inputs is is really valuable, I think, to create a vibrant rail sector.
00:11:46
One of the questions I wanted to.
00:11:47
Ask you was the traditionally you've been a a?
00:11:50
Commuter talk in the past.
00:11:53
And with COVID, that has kind of changed.
00:11:55
Quite a lot, hasn't it?
00:11:56
In terms of how people are travelling and and where they're travelling to and when, they're.
00:12:00
Travelling. How does that?
00:12:02
Affect your sort of commercial and outlook and and what?
00:12:06
Can you do?
00:12:07
To sort of combat that, to make sure that you still keep the numbers coming onto the train.
00:12:11
So you're absolutely right. We have seen our commuter.
00:12:15
As measured by season, ticket purchase declined by around 1/2, it varies by different routes we've got.
00:12:22
A very disparate different set of routes, whether it's in the metro, it's on our kind of classic main line or our high speed, and they're recovering at different rates and they've got different influences on them. What we've done for.
00:12:36
Actually very long time now. We started this probably in about 20/21/22 is we have experimented and diversified marketing away from just being about leisure and incremental discretionary travel and we've really dug in to finding.
00:12:53
Out why people are commuting? Most importantly, why people aren't commuting, what the triggers would be to help encourage them to come back when the societal changes are happening and we're now in a position where we spend actually slightly more than half of our marketing budget goes towards recruiting.
00:13:13
Mute us back because typically not always, but typically they are higher yields per journey. Yeah. And and we have that capacity, we're back with that capacity point again in the peak we have demand.
00:13:26
In the peak, we are seeing peak spread. This isn't a particularly a southeastern thing. I think everybody is saying peak is spreading later goes back to your point about people's perception of rail fares where they can, they are finding ways to travel in the off peak in order to make that journey more cost effective, particularly if they are.
00:13:46
UM.
00:13:47
Former season ticket purchases and they're looking otherwise as at anytime day return. So we also think about this season ticket as a product that has enormous benefits. I say this is.
00:13:57
An annual season ticket.
00:13:58
Holder I realise I'm in very much in the minority but I am an.
00:14:00
Annual fee ticket holder, one of the great things about it isn't it is you don't have to think, have I?
00:14:05
Got money to buy a ticket? Will the ticket office?
00:14:07
The open will the machine be working? Have I planned ahead or not? Did I do it at home the night?
00:14:11
Before on the app or.
00:14:12
Not I just get on that train. It's my train. It takes me where I.
00:14:16
Want and.
00:14:17
That's to me, the marketeering me says, you know, that's a huge emotional benefit. I'm part of that railway I own.
00:14:26
The right to be on there and I think sometimes we think we think about the price to the exclusion of some of the other attributes of products that we're putting out there. Yes, you know sometimes we all like the bargain and hunting around and finding the best value ticket.
00:14:41
Is emotionally satisfying too, but if it's about making a repetitive journey convenience, I think.
00:14:47
Is a much under celebrated facet.
00:14:50
I completely agree with there in terms of the simplicity of travel. Quite often in the morning when I'm if I don't have a season ticket, it's one of the first things I think of is, oh, I need to get my train ticket and when you're in a.
00:15:04
Rush, you don't really think about the simplicity of it, but as soon as you do have one as season ticket like you say, the simplicity of it really makes weight in terms of the argument for convenience. I guess for many people coming and travelling on a train has always been certainly for commuters.
00:15:24
It's been very much a a thing that they have to.
00:15:28
Do so it exactly. Obviously that's may not be the case anymore with commuter.
00:15:30
It's a distressed purchase.
00:15:36
What do you think you can offer travellers and, well, passengers on the train? What do you think you can offer them to to make sure that they do want to come back. What does the 21st century train journey look like for a passenger? Really.
00:15:51
What we can offer?
00:15:52
In terms of the journey itself.
00:15:55
Hasn't changed radically, if I'm honest with you. We have taken away first class. We took that.
00:16:00
Away a year ago.
00:16:02
But created an extra 4 million seats that passengers could make use of, and that is obviously an important part for many people on longer journeys that the proposition is, is this going to be comfortable?
00:16:14
Yeah, the other.
00:16:15
Area in which we've been moving forward since during the pandemic, actually August 2020, we launched our seat.
00:16:23
Service that told passengers how busy trains would be. This is now obviously quite commonplace. Lots of talks have done this, but we actually got first into the market initially, partly from a health perspective, so information that tells people where it is, they're going to find the best number of seats on their trains, whether they could change. We're also now using a service.
00:16:43
Where we provide behavioural nudge emails to passengers to say if you went, you know, on the next train, it's actually typically a bit quieter and now if you've gone through, let's say three or four tickets in a week, we will send you a nudge saying if you're signed up to our database.
00:17:01
You could have bought a season ticket and actually we're in better value. If you bought season tickets. So we are really embracing.
00:17:08
That position of.
00:17:10
We don't we.
00:17:11
Don't have to have you back as a season ticket holder.
00:17:13
That would be great.
00:17:15
We want you to travel on our trains. We want you to be part of our railway and we're going to help you. We're going to be your ally in finding the best value. And if it means that you are going to have a digital rail card, a network card, and you're going to use that to get to work, absolutely fine.
00:17:31
This is how you do it. If you want to flexy season.
00:17:33
You can do it like this, so all sorts of different options and we're looking, you know, as we look forward into the next couple of years, we're looking at new ways to make it easier and more convenient because one of the one of the interesting and unanticipated benefits just from our flexi trials, we've had such a focus on understanding that is that we've seen more journeys.
00:17:53
Come back on.
00:17:54
Oh, right. OK. Oh.
00:17:55
So the railway, the.
00:17:56
Railway is obviously talking about Mondays and Fridays. What do you do about Mondays and Fridays? Everybody's in the that nasty acronym in the middle of the week and without saying to people love Mondays. Like indeed do as their advertising slogan. And people have just gone. Well, I've now got this convenience. I could go in on a Monday. I'll always get a seat on a Monday. I I like going in on a Monday. It's much quieter.
00:18:17
On the trains and.
00:18:18
Well, it's it's Friday for me.
00:18:20
Yeah. So it's it's about finding those opportunities and demonstrating to people, I think that you are on their side because historically I think some people.
00:18:32
Found season tickets on an annualised basis. A big outlay. Find people find season tickets a big outlay and also.
00:18:41
Did feel in a position where they had no alternative and marketing somebody something because?
00:18:48
They have to buy it.
00:18:50
Rather than they've chosen to buy, it is a position that, you know, we should be looking for features in those products that help people believe it's the right.
00:18:57
For them, all sorts actually of of related benefits. Our research tell us about the social interaction. What you learn at work, you know, lack of distractions, better opportunities. These are all starting to come through for people, but they're not directly related to rail travels. They are a consequence of going into the office.
00:19:18
The rail journey is the way that gets you into the office, so I think the next big opportunity does come in encouraging people to think about how they decarbonise their.
00:19:27
Journeys, we offer a carbon calculator which sits on our website and that allows you to pre calculate if you went from Saint Pancras to Ashford, how many kilos of CO2 you'd save, and in fact it works right the way across countries is the FT targets in terms of the amount of carbon that you consume. We're in the process of integrating that into our journey.
00:19:49
Time because we think it will be much more compelling. You know, I'm gonna go on a train. It's going to cost me this.
00:19:54
And rather than drive, I'm going to save this amount of of CO2. That's a really important moment to convince somebody that it's worth spending on the rail ticket because they're getting that secondary benefit.
00:20:05
And has your research sort of backed up that thinking in terms of that's an important aspect of somebody buying a ticket, is it, you know, and buying a ticket in terms of decarbonisation, is is a good thing is is that?
00:20:18
Of research backed up that original thought.
00:20:22
Yeah, yeah. I mean, there's there's been industry research and I think some other online retailers in the rail sector have also looked.
00:20:30
At this it.
00:20:30
Varies by demographics, but for some demographics it's very important and for other demographics it's. It's also important, but not as important. And and I think this is where to a certain extent.
00:20:42
When you look at these big kind of.
00:20:45
Societal shifts which?
00:20:48
Everybody, including the government, I mean, we're talking, I think COP 28 is still going on.
00:20:52
As we're talking.
00:20:53
We're we're going to have to make these changes.
00:20:57
And there is a level at which pointing this out to people not in a preachy way, but just making them aware is going to help change people's perception of importance.
00:21:07
2020 years ago, people people didn't think about their fridge with CFC's as being a bad thing. It was just their fridge. Eventually everyone learned that the CFC's and their fridge were.
00:21:07
I guess.
00:21:16
A bad thing and wanted a different fridge.
00:21:20
I guess that being the public perception itself in terms of rail travel has being one of the best low carb options out there for travel is not quite what you would expect it to be. You'd kind of expect it to be higher, I guess awareness of that is something that that the industry has to do an awful lot.
00:21:40
More in the future.
00:21:41
Yes. Yeah.
00:21:42
And Speaking of the future and obviously the industry itself is going through an awful lot of change. Do you see the the structure? So I'm talking about GBR plans now really.
00:21:53
How do you think that can benefit operators, certainly from a commercial sensibility?
00:21:58
Bringing together track and try and bringing together talks.
00:22:02
Has the potential to really benefit simplicity for the customer. For product simplicity, information simplicity, greater coordination, things like world data marketplace that we and and other talks are involved in are are part of that are richer and simpler ecosystem of information.
00:22:20
It should also lead to economies in terms of things being done once and collectively, rather than separately.
00:22:29
And it has also to enable local variation. So what will work in Kent won't necessarily work in.
00:22:37
Somewhere else in north, east or something.
00:22:37
Hull or whatever is somewhere else. The NE it it's, it's situational. We've got very different railways up and down the country. But actually being able to share the information and think about how you'd apply.
00:22:49
Something that has been learned in a slightly different way somewhere else, but the ways in which and the detail of when the industry comes together, I.
00:22:55
Think is is a.
00:22:57
Yeah, way beyond my speculation at the moment.
00:23:00
I think it's way beyond most people speculation at the moment. In fairness, we all know it's coming in in some sort of way.
00:23:08
Yeah, completely.
00:23:09
What it actually looks like is up for debate. I guess you mentioned earlier, Alicia, that you didn't always work in in rail and from other industries that you've worked in. And I know you've worked in the transport sector beforehand. What do you think that rail can learn from other sectors, specifically of in transport?
00:23:28
Or other sectors broadly. What what do you think they can learn from from those?
00:23:32
Rail is a.
00:23:33
Huge, vital and really interesting sector to be involved in. I really love being involved in the rail sector and at the same time it sometimes feels like it's large enough to be its own ecosystem.
00:23:46
And that occasionally results in people being perhaps not curious enough about how things are done in bus. In maritime, people tend to be more curious about what happens in aviation. We talked a bit earlier about seat Finder. I mean, part of why I led the programme to introduce seat Finder is I worked for a shipping company that.
00:24:06
Had weight sensitive ships. You know you can only load. Just load a certain number of kilos on and I applied some of the knowledge and understanding I gained from that to think well, if we used to do it this way, then actually we can do a similar thing here.
00:24:20
I think, Ray.
00:24:21
Built tends to have a an absolutely vital, incredibly important respect for safety, but then tends to apply the level of quality that is required for safety to everything, and is sometimes perhaps a little risk averse.
00:24:41
Sometimes you know well if it's not guaranteed to be a success, then maybe we shouldn't try it rather than.
00:24:48
We'll try it, and if it doesn't work, we'll learn and regroup and move on. And the big disrupt is in the last 25 years have all made missteps and backed away from them. They're they're well, well written up and gone in a different direction. And you know, Google's first social media was something called Orchard, probably from the early 2000s.
00:25:08
You might not, even.
00:25:09
Remember, it hasn't stopped it getting involved in social media now hasn't stopped it. Purchasing YouTube and turning it into a viable alternative to linear television.
00:25:20
This is all part of the overall ecosystem, so being prepared to try things and take very carefully calculated risks away from the safety critical environment, I can't stress that enough.
00:25:35
So do you think it stifles innovation a little bit? Obviously, safety is a huge, huge part of rail and it has to be rightly so. But do you think it's stifles innovation?
00:25:46
I don't think safety stifles innovation, and I definitely wouldn't, anybody I've worked with in a safety context, I would not put, as you know, kind of looking to stifle innovation.
00:25:58
I think it's the respect and the certainty that a safety critical calibre development has people tend to go well. I'm going to transfer that across to what I'm doing over here because that must be the right way. So I think quite often this is something people do to themselves. It's not something that is.
00:26:18
Kind of formulated in the methodology that they've been given or the way that they've told things must be done. It is culture in the genuine sense of the way things we do things around here. And because of the way we do things around here is so safety critical that gets sucked across sometimes.
00:26:35
Into the way people approach innovation.
00:26:37
Thank you very much for your time today. It's been great. Thank you.
00:26:41
You've been listening to the latest podcast from Rail Technology magazine. Don't forget to like and subscribe to make sure you receive everything new edition.