Industry Research

Lots Of Reasons To Be Optimistic About Industry Future

Posted on May 12, 2017 by - Also by this author

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LCT Publisher & Show Chair Sara Eastwood-Richardson (LCT photo)
LCT Publisher & Show Chair Sara Eastwood-Richardson (LCT photo)

LAS VEGAS — An improving economy and new technologies can create more opportunities, but how well an operator meets customer expectations determines success, according to the annual 2017 State of the Industry Address that opened the International LCT Show March 13.

A limousine operator looking toward the long term should take one action ahead of all others: Befriend mobile technology to ease booking and service for clients. The industry is experiencing a big shift caused by technology and market cycles, said LCT Publisher & Show Chair Sara Eastwood-Richardson, who summed up the latest industry trends in the presentation.

In-Depth: For a white paper, power point, and audio recording of the  presentation:   www.lctmag.com/soi-2017

Industry Size

Sara first assured the audience the wave of company sales and mergers in the last few years is a cyclical market consolidation, as some companies adapt and grow and others choose to bow out.

After the worst of the Great Recession in 2010, the industry had fewer than 6,000 operators. Now, more than 11,000 are in business, and because the limousine industry is an easy-entry market, it has more pronounced cycles of expansion and contraction. Due to increased competition, some operators are making less money. That leads to consolidations. Companies wanting to stay in the game must invest in infrastructure, while exhausted companies choose to be sold, merged, closed, or passed on to a new generation.

“There’s movement afloat, but a cautionary tale: Don’t mistake the natural ebb and flow of our industry’s head count with false news our entire industry is dying, or we’re all a bunch of sheeple heading for the fatal cliff. That is absolutely not the case,” Sara said.

Technology
With those fears addressed, Sara focused on those operators wanting to stay in business and grow.

Chauffeured services must be client-centric first and build more business by meeting the needs of business travel managers and clients now accustomed to Uber-style mobile technology conveniences, she said. That means making technology a “best friend” and streamlining operations to ease all the steps in the booking and reservation process. Above all, listen closely to clients and adjust service to meet them where they’re at. “Your future is to make things easy for your customers,” Sara told a packed ballroom at the Sands Expo. “You’ve got to love technology. You’ve got to geek out on this stuff.”

The one thing Uber did to revolutionize the for-hire transportation industry was make it easy. While they didn’t invent for-hire service, they identified a clunky system for logistics that was difficult to deal with. Taxis were sketchy on just about every point of the experience, including booking, pick up, drop off, payments, and customer service.

“We spend a lot of time focused on Uber – and it’s important to follow them and to stay on their compliance tail,” Sara said. “However, whether Uber stays or goes, it’s no matter. They have successfully changed the consumer’s expectations of for-hire transportation. Until the next best thing, the Uber technology sets the bar for bookings.”

Booking Process
The two most crucial aspects of your business are the booking and the ride. Uber’s technology has created a mindshift in the consumer. They love the ease of the Uber app. “Whether or not your client has come out and said it does not matter, the Uber app is a painless experience.”

Regardless of anyone’s feelings toward Uber, operators still need to invest in mobile app technology that mirrors Uber’s, since it came first and set the bar of expectations, Sara said. While operators should grow revenues via mobile app technology, they first need to “find the easiest means for booking, deploying, and executing your service for your customers. If you work this in the reverse, you may win the battle and lose the war.”

The term “chauffeured transportation operator” means many things to a lot of people, said Sara, with the word “service” yet to be clearly defined by this industry. “Therefore, you have companies only a click above a taxi service calling themselves limo operators. On the extreme opposite side, you have companies that are high-touch, high-tech, and have immaculate fleets and staff. In the middle, you have lots of variations of service.

This creates brand confusion for the industry and affects the overall business model’s image, she said. “This must be fixed. We need to identify who we are, and we need to do that today because our goal this year is to make sure doing business with our industry is easy and consistent.”  

The Coming A.I. Revolution
Operators also should start thinking about artificial intelligence as a serious next step in customer service, Sara said. AI “reps” don’t sleep, speak different languages, can interpret client moods, and provide instant answers. “So no more voice mail, no more hold buttons, no more phone prompts — and no more employee challenges in the highest burn-out aspects of this industry.”

AI will be not only be a major mark of distinction for the industry, but it will also quickly become an expectation as call centers replace older systems with artificially intelligent voice systems and bot technology on their websites as a more efficient way to serve customers. Thanks to AI, chauffeured clients soon will not tolerate the “old world way,” she said. Just as when the Town Car body style changed from a boxy frame to the more rounded one forcing operators to upgrade fleets, that is what AI is about to do to the customer service industry.

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