The large Washington, D.C.-area fleet operation gains a maintenance facility from Capitol Coachworks.
One of the challenges in being a young business owner today is that because technology has rapidly changed so much of how we do business, it can be overwhelming to think about what to do next. Established limo companies and motorcoach operators are reaching out to find new ways of completing business needs like attracting top-quality chauffeurs, and improving fleet operations through technology, and embarking on new web marketing programs.
The LCT Fast40 group was created for younger operators looking for ways to grow their business and stay competitive in their markets, and the dialogue over how best to do this brings out some great tips for owners to try.
Here is an exchange between Victoria Clark, president of Clark Transportation in Taylor, Texas, and Michael Campos, former associate editor at LCT Magazine, and current sales and marketing executive at Grech Motors, on ideas to help resolve motorcoach business concerns ranging from how to recruit new drivers to new social media tactics and expanding into new markets.
Victoria Clark: As a young owner, 26, one of my biggest fears is that the career of being a chauffeur/driver is a dying breed. People in my generation think a professional chauffeur/driver is someone operating an 18-wheeler or Uber vehicle. Our pay is excellent, our benefits cannot be beat, and we have ways to move up in our organization. How can we bring the late 20s-30s crowd into a long standing career? I feel one of the biggest struggles with this generation is that they value their personal time more than their work time. They do not want a 7 day tour; they want a day trip where they are home at night.
Michael Campos: You’re absolutely right that our generation, the millennial generation, generally values personal time more than work time. One of the problems I see with our generation is that it feels too entitled and has lost the work ethic that powered previous generations. But that doesn’t mean it’s a hopeless case.
There are plenty of companies who continuously attract bright, gifted, and eager employees, and while most of them are in the technology sector, an arguably “sexier” industry than travel, there are certain things transportation operators can learn from them. Tech companies make work time just as attractive, if not more so, than personal time, by creating a company culture that make employees feel valuable, no matter what their role is. If you can get members of our generation to see the value in the work they’re doing and how it plays a role, however major or minor, in affecting the world, they’ll develop the intrinsic motivation that is at the core of every loyal and hardworking employee.
And if you think about it, the travel industry is a pretty sexy industry too. Our generation values diverse experiences, and few things provide the opportunity to expand one’s life experiences than traveling and meeting new people. The chauffeur/driver profession offers both. If operators want to make the chauffeur/driver career path more attractive, they must first begin thinking of it as a lifestyle and more than just a job that pays the bills and offers benefits. Start by defining some of the unique things that a chauffeur experiences, and then invest the time and energy to promote them on your company website and social networks.
For example, there is an inherent sense of adventure in being a chauffeur because one never knows what one will encounter on any given day. When I speak to elite chauffeurs and operators who still get behind the wheel and ask them what they love about chauffeuring, many of them tell me it’s because every day brings something new and different, from the people they meet to the places they go. Like you said, they would rather have a day trip where they are home at night, rather than spend a week on the road. But if they see the seven-day tour as an opportunity for adventure, and even as a chance to escape the traditional 9-5 grind in a nondescript office, then maybe they’ll value that longer trip more.
Not only can you appeal to the value that chauffeurs create for others, but also the value that the job creates for them. If you can communicate the value proposition correctly — the value a chauffeur adds to the world and the value being a chauffeur creates for the person — then it’s no different from a tech company wooing engineers with their vision of creating value for the world.
Another example would be to play up the crucial role chauffeurs play in the travel chain. One day they could be transporting an influential executive headed to a meeting where world-changing decisions will be made. Another day they could be transporting someone who’s on a trip to see their family or friends, or take a much needed vacation. In any case, they’re contributing to the greater good of the world by helping people connect the many dots in their lives.
At the end of the day, it’s about how clearly and creatively operators communicate the benefits of being a chauffeur. Consider it “employee marketing.” Just as a brand must invest in creating a great marketing and sales strategy if they want to build a strong, high-quality customer base, so too must they invest in marketing and selling the chauffeur profession to prospective employees.
Victoria Clark: I love competition as I believe it keeps operators on their toes and at their best! However, often times we see operators cutting prices to extreme levels in order to take the customer away from their competitors. With this being said, there is a price level that an operator will hit where they will not make profit or even lose profit. Is this price cutting devaluing the transportation industry as a whole and how can we get fellow operators to break away from this “old school” pricing style?
Michael Campos: Price cutting definitely devalues the transportation industry as a whole, and it hurts everyone, from operators to passengers. For one, it trains people to think of price before they consider more important elements, such as safety, service, and experience, and this is to their detriment. Look at what Uber has done to the ground transportation industry. In addition to the convenience, there’s the perception that it’s a cost-effective travel solution — except when surge pricing is involved. Thus, massive numbers of people have adopted Uber as their go-to travel service, and as we’ve seen from the growing news reports on the matter, are exposing themselves to safety risks and service inconsistencies.
When an operator runs on razor thin margins, you have to wonder how they’re able to invest in the maintenance and improvement of their human and mechanical resources. If they can’t afford to invest in hiring better staff, train their current staff, and maintain or upgrade fleets, they’re setting themselves up for long-term problems. They also expose their passengers to safety risks. Look at the bus crashes to make headlines in recent years — many of the companies involved ran vehicles that hadn’t passed safety inspections and with drivers that were poorly trained or poorly managed. Have this conversation with passengers.
Focus marketing and sales efforts on communicating the value you’re delivering to people for the price you’re charging — the service, the new, safe equipment, the highly trained drivers, and the experience. It won’t be easy to break the cycle of price-cutting among operators, but it can be done.
Victoria Clark: Many operators are utilizing social media and have seen great success. Our company has received a lot of business from our posts and ads through our Facebook page. I believe it is a great way to start conversations with potential customers and keep current customers up to date with our services and new vehicles One thing I have seen that is gaining popularity in the social media world is the app SnapChat. Are businesses utilizing this app and are they seeing any value in it?
Michael Campos: I’m so glad you brought this up! I’ve been talking non-stop about the potential of Snapchat as a marketing tool since I really saw its potential at the LCT Show in Las Vegas this past March. A good friend of mine, Andy Reyes, who is the COO of the inbound marketing agency Dash30 Digital, created a Snapchat “story” of 24 hours at the event. It went from getting breakfast in the morning to getting dressed for meetings to attending various Show events to getting dinner to partying at the club to the after-hours gatherings at the circle bar to finally retiring back at the room the next morning. Because the snaps (which the Snapchat posts are called) are a maximum of 10-seconds, it made me really pay attention to the content. It was like watching a short film.
After 24 hours, the posts disappeared, and that’s what I think is so great about Snapchat — it turns digital media, which has become a commodity these days, into something of a novelty. People automatically place a premium on something they can’t have, or in the case of snaps, something they know they can’t have forever.
If you post something on Facebook, Instagram, Twitter, or Vine, I may not pay attention right away because I know I can go back to it later, and when later comes, I’ve already forgotten about it. But if I follow you on Snapchat and you post something, I’m going to pay attention because A) it’s 10 seconds max, so if it was something stupid, I don’t feel like I wasted that much time, and B) I know I won’t have a chance to see it again after it disappears.
Now that I’ve rambled about the psychology behind Snapchat’s potential, let me try to provide some actionable tips for using it as a marketing medium for your business. There are businesses using this app that are definitely seeing the value in it. Refer to these two Fast Company articles for examples: How 12 Brands Used Snapchat & This Brand-Creator Collaboration on Snapchat is How CEO Evan Speigel Shoujd Have Tried to Make Money.
Because you’re in the travel industry, your account can create Snapchat stories about trips you make and places you visit. Take “behind the scenes” snaps of things at the office. Or give a chauffeur control of the account for a day and have them create a Snapchat story of what it’s like to live a day in their life (this could also help solve the problem of attracting people to the profession).
Better yet, hold a contest among tech-savvy passengers where the winner gets to control your Snapchat account during a multi-day trip. That kind of customer-generated content is like gold in the digital and social media marketing world. I believe Snapchat is one of the best ways to market your brand to younger generations.
Victoria Clark: In the transportation industry, you see many limo/sedan operators attempting to get into the bus industry. However, you rarely see bus operators attempting to get into the limo/sedan industry. This has always intrigued me. Do you think it is because it is hard to scale down group travel than it is to scale up individual travel? What are your thoughts on this in general?
Michael Campos: It takes a lot of effort to compete in the saturated sedan service market and it’s not always worth the return because margins are pretty slim. Another reason is that individual travel generally requires a higher level of service than bus travel, and if bus companies aren’t already training drivers as chauffeurs, they could have a rough start.
There’s definitely a learning curve to becoming a chauffeur, and drivers without prior training may find it hard to drop bad habits and build better ones. Chauffeurs are more than drivers; they’re mobile concierges, and they require a certain level of finesse and people skills to be successful.
Whenever an operator wants to jump into a new niche that requires vehicles they haven’t run before, my suggestion is always the same: before investing in vehicles of your own, try to develop a few affiliate relationships to whom you can farm out the jobs.
While this strategy comes with the risk of being unable to control the service level, it gives operators the advantage of marketing and selling services without the additional overhead. One can then study the monthly numbers and see if the demand justifies purchasing your own vehicles.
Victoria Clark: Many transportation companies in previous decades hedged fuel in hopes of saving money. To me this seems like a large gamble in today’s economic market. Is this a very popular fuel purchasing method in today’s industry?
Michael Campos: I do not know how popular it is in today's industry, but I too think it seems like a huge gamble in today’s economy. Although the technique was designed to protect operators from the volatility of oil prices, I think it requires a lot of planning and precise execution or it can expose operators to unnecessary headaches.
There are insurance and accounting regulations to consider, potential up-front premiums to be paid (depending on the program), and additional budgeting challenges for fleet managers who many not have the requisite experience to get it done properly.
Operators instead could focus their energies on reducing costs in other areas more directly under their control, such as investing in technology that can make fleets run more efficiently through better routing; vehicles that require less maintenance and/or get more miles per passenger, or an automated, user-friendly reservation software or interface that travelers don’t dread using. If you can automate the reservation process, you can eliminate human errors (from your end) and reduce the human resources required for it.
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