business news in context, analysis with attitude

by Kevin Coupe

The Boston Globe reports that there is at least one institution happy with all the controversy about airport security lines.


The railroad’s Acela Express high-speed service has grown into an unqualified success since it was launched in 2000. According to the Globe, Amtrak had as its goal “grabbing a larger share of the lucrative business travel market from short-haul air routes between Boston, New York, Philadelphia, and Washington. By most measures, it has succeeded.

“Amtrak now transports 55 percent of passengers in the Boston-New York air-rail market, up from 16 percent in the mid-1990s, according to the New England Transportation Institute, a nonprofit research organization in Vermont. Acela’s ridership has risen nearly 30 percent, from 2.5 million passengers in its first full year of service to 3.2 million passengers in fiscal 2010, which ended in September. Air travel, on the other hand, has declined.

“Last year, nearly 30 percent fewer people flew between Logan and the three New York-area airports than in 1999, the year before Amtrak introduced Acela, according to the Bureau of Transportation Statistics. Air passenger numbers decreased 35 percent between Boston and Philadelphia and 8 percent between Boston and Washington in the same period ... Meanwhile, Amtrak has its eye on the day when no one will choose to fly from Boston to New York. In a report looking ahead to 2040, when projected 220-mile-per-hour train speeds will cut the 3 1/2-hour trip to 83 minutes, Amtrak officials forecast air travel on the route will fall to zero.”

Here’s how David Lim, Amtrak’s chief marketing officer, assesses the opportunity: “We’ve designed a product for the business travelers’ needs, and we’re trying to reach them at the most relevant points of their travel experience. The underlying assumption being the airport experience has not been the best in the last couple of years.”

And because Amtrak doesn’t want to just let the trend evolve on its own, the company has become more aggressive in its marketing. The Globe writes, “ Amtrak is targeting airline passengers where they live — in airports and security lines. A larger-than-life banner promoting Acela now stretches above the three-lane roadway at Logan International Airport. A TV ad for the high-speed rail emphasizes ‘taking off your shoes only if you feel like it’ - a reference to tightened airport security measures that recently some say have bordered on groping.”

It was just a month ago that MNB had another Eye-Opener about trains (which may reflect my prejudice for this particular mode of transportation). At the time, we referenced the fact that experts were saying that Amtrak revenue was growing because of what was termed “the real game changer” - the ability for people to use “smart” technology - laptops, smartphone, iPads and the like - to work and communicate from almost anywhere.

And Michael Sansolo has written here about his enjoyment of long distance bus travel; there is a real sense that travel is getting more competitive.

Matthew Coogan, director of the New England Transportation Institute, tells the Globe, “I would hope that we’re going to see a stabilization, where Amtrak really knows it’s got to compete for your dollar, where those aviation companies know they have to compete for your dollar, and the bus industry knows they have to compete for your dollar. And we seem to be seeing it. Who would have guessed you would get a good Wi-Fi connection on a Greyhound bus? But you do.’’

“Compete” is a verb. We’re seeing it in the transportation business. And we have to practice it in the retail business - by identifying and implementing game changers, and then with in-your-face marketing.

All aboard.
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