THE ROUTE TO SUCCESS

Nigel EggletonSales & Marketing Director

Introduction

• Blazefield: £55m turnover business• Largely deregulated market• Success based on route branding & marketing:

• and efficiency & cost control:

• This is a story of both ...the 36 story

The Route

Connecting...

• RiponPopulation 13,000

• HarrogatePopulation 80,000

• LeedsPopulation 500,000

The Route

• Established80 years ago

– as route 36

History

• 1998Passenger decline haltedwhen frequency increasedfrom every 30 to every 20 minutes

• 1998-200423% growth in passenger numbers

2004

• Growth had stalled (-2% in 2003)

• £2.45 million investment

• 13 new buses designed anddeveloped in conjunctionwith Volvo and Wrights.

• £33,000 extra per busto achieve higherspecification.

Features

• Aircraft-style leather seatswith armrests.

• Extra legroom.

• Feeling of security increased withCCTV fitted to both decks

• Strong identity branding externally and internally – ‘mobile billboards’for our service.

Results

• Talk of the Town!

• Within 6 monthsgrowth up to 12%.

• Mainly off-peak growth.

• Significant numbers of newcustomers hadn’t used busesfor years.

• 2004 Bus Industry AwardsMarketing Award Winner.

Passenger Growth

• 2004 - 15%

• 2005 - 8%

• 2006 - 16%

• 2007 - 17%

• 2008 - 5.2%

• 2009 - 0% (compared toa national declineof 4.1%)

2009

• Growth had ceased

• Buses now 6 years old

• Evidence of ‘marketing life-cycle’

TIME = 5 years

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Interim Brand Refresh

• Updated external identity

• Promotional messageswidely applied

• Marketing campaign tosupport updated brand

• RESULT = May 2010patronage growth 3.5%

2010

• New bus investment decision = £3.0m

• Volvo/Wrights still buildingthe same product

• 2+1 seating?

• WiFi?

• Increase to a 15 minutefrequency?

Ideas in Action…

• Pilot ideas through a development bus

• Refurbish/rebuilding an existingbus costing half the newbus option.

• Introduce 2+1 seating

• Eliminate unpopular downstairsrear-facing seats by creating a‘lounge-style’ area.

Customer Research Results…

• 81% liked the comfort of the new seats.

• 62% liked the extra room between seats.

• 55% liked the individual seats.

• 50% liked the ‘lounge area’.

• 57% thought the bus was quieter– 0% thought the noise was worse

Actions taken from feedback…

• 81% liked the comfort of the new seats.• Incorporated into the rebuild programme

• 62% liked the extra room between seats.• Incorporated into the rebuild programme

• 55% liked the individual seats.• Incorporated into the rebuild programme, but

repositioned to remove the ‘isolated’ feel.

• 50% liked the ‘lounge area’.• Aim of removing rear-facing seats achieved

- chassis & axle design restrictions

• 57% thought the bus was quieter– 0% thought the noise was worse

• Even more soundproofing added in rebuild programme

• Bold new identity.

• Updated contemporaryexternal styling.

• Co-ordinated internalmaterials.

• New & improved lighting.

• Artwork on blank panelto improve ambience.

• Attractive touches tofully ‘dress’ the vehicles.

36 – customer benefits…

• Frequency increased toevery 15 minutes

• Reduction in seating capacitydue to 2+1 seating

• Anticipation of further growth.

• WiFi added• competitive & data-capturing tool• uncommon outside inter-city trains

and long-distance coach services.

• Free Smartphone app introduced • the first for a UK operator• pinpoints location & nearest stop• real-time info about next bus

36 – customer benefits…

• ‘route 36 – ideas in action’

WINNER

‘Making buses a better choice’ awardat the 2011 UK Bus Awards

36 - industry success…

• Introduction of a 6th gear• Improved fuel consumption.• Reduced engine wear.

• New engines• Greater reliability.• Reduction in engineering time.• More environmentally friendly.

• Electric Cooling Fans• More efficient

• Together, these measures alsoproduced a 10% fuel saving

36 – engineering benefits…

• Cost of refurbishment = £1.4millionCost of new buses = £2.7millionSaving = £1.3millionWritten-down value of buses £92k per bus

• Operating lease of new buses = £366k p.a.Depreciation = £257k p.a.Saving = £109k p.a.

• Fuel MPG improved by 10% to 6.7mpgSaving = £75k p.a.

• Maintenance costs reducedSaving = £49k in year

• Avoided any loss on sale of existing buses

• And of course – revenue growth

36 – financial benefits…

The story continues…

• Deregulation in the UK bus marketrequires innovation.

• Passenger growth is keyto profitability.

• New Product developmentdrives growth.

• Cost control and efficiency.

• 36 proves the case!

6.2% growth!