Audit to identify new customer segment for university assignment

1. MC6003 – DIRECT AND DIGITAL MARKETING
NATIONAL EXPRESS AUDIT
Alexandra MacLeod/10034912

2. • National Express can trace its roots back to the 1920s:
– Greyhound Motors of Bristol
– National Bus Company
– British Electric Traction Group (BET)
• “National Express” brand name used since 1972, official since 1974
• Introduced Rapide - “upmarket services” such as hostesses, refreshments and
toilets.
• Seat bookings late 70s – revolutionary at the time
• 90s brought numerous mergers and acquisitions
• 2003 - Flightlink, Jetlink, Speedlink, Express Shuttle, GoByCoach, Airbus
– Competing against each other
• Brand refresh – upmarket services abandoned
• 2012 – celebrated 40 years of serving the British Public’s travel needs
• 2014 – over 1000 UK destinations
• 2014 – 16 million travellers every year
INTRODUCTION TO NATIONAL
EXPRESS

3. • Where are we now:
– Business to Consumer - affordable, reliable, quality coach travel
– E-procurement – services
– E-Adoption stages 5 - integrated website
• Good information and interaction.
• Handles sales transactions
– Purpose of current digital channels:
• Sell services
• Customer services – relationship building
– Current benefits of digital channel :
• Sell – main sales tool for Nat Express (also uses Post Office and coach ticket
offices). Convenience for customer and company – cheaper for both
• Serve – customer service tool. FAQs, real time tracker, lots of info .
• Save – online sales cheaper, online loyalty cards,
• Speak – real time tracker updates, email newsletter,
• Sizzle – brand development / added value -
SITUATION ANALYSIS

4. • Value Chain
• Online Value Proposition
– Why buy online rather than through a different channel?
• Offers make it cheaper
• Convenience for customer
• Environmental concerns - paperless with mobile/email tickets
• What we do
– Affordable quality UK coach travel
• What we don’t do
– Luxury travel – phased out in early 2000s
SITUATION ANALYSIS CONT

5. • The Numbers:
– 2012 revenue - £255.1 million (2011: £259.1m) 2% decline
• Government cut OAP concession scheme worth £16m to Nat Express
• 40% less OAP traveller’s than 2011
– Operating margin was 8.1% (per £1, NE makes 8p)
• “The drop in margin, from the withdrawal of the concessionary
income, reflects a lower but sustainable level of profitability which is
not dependent on material Government support.” (NAT Express ref)
– Customer satisfaction – 84%
– Market share – 60%
INTERNAL AUDIT
Source: National Express, 2014

6. – REACH
– ACT (INTERACT)
DIGITAL MARKETING
EFFECTIVENESS - RACE
196,000 30,250 99
Source: Alexa, 2014

7. RACE - CONT
CONVERT
LOW BOUNCE RATE, PAGES VIEWS INDICATIVE OF TRANSACTION TAKING
PLACE
ENGAGE
LOYALTY OFFERS – CARDS IMPROVE SOCIAL MEDIA
Source: National Express, 2014

8. • VALUE PROPOSITION CHANGED TO COMPETE WITH COMPETITORS
– POSITIONS ITSELF AS QUALITY CLEANER, MORE SPACIOUS THAN
COMPETITORS BUT WITH SAME CHEAP PRICES
• MEGABUS NOW OFFER ‘GOLD’ SERVICE
– SIMILAR TO RAPIDE SERVICE
STRATEGIC
ISSUES

9. • POLITICAL:
– LEGISLATION:
• COOKIES, PRIVACY LAWS, EMAIL MARKETING REGULATIONS – SUCH AS OPT IN
• ECONOMICAL:
– KEEP UP WITH COMPETITORS PRICES
• EASILY ADVERTISE PRICES AND SALES ONLINE
• SOCIOCULTURAL:
– Lifesytle trends:
• USERS VERY LIKELY TO BE BUYING ONLINE - EITHER VIA COMPUTER/TABLET OR MOBILE
– LINKS FROM OTHER WEBSITES TO NATIONAL EXPRESS
• SOCIAL MEDIA – PART OF LIFE
• TECHNOLOGICAL:
– NO MOBILE APP
• CUSTOMER SEGMENT UNIVERSITY STUDENTS - HAVE SMART PHONES
– MORE CONVENIENT – CONVERT SALES
MACRO ENVIRONMENT ANALYSIS –
DIGITAL MARKETING STRATEGY

10. • CUSTOMER SEGMENTS:
– STUDENTS
– RETIRED / OVER 60S
CUSTOMER INSIGHT
Source: National Express, 2014

11. • DIRECT COMPETITORS
– MEGABUS
– STAGECOACH
• INDIRECT COMPETITORS
– TRAIN S ON SAME ROUTE SUCH AS:
• SOUTH WEST TRAINS
• VIRGIN RAIL
COMPETITORS
- £255.1 million
- Operating margin
was 8.1% (per £1, NE
makes 8p)
Source: Megabus, 2014

12. MEGABUS .VS. NATIONAL EXPRESS
(DIGITAL)
Similarities: Layout design – journey planner, savings deals
Differences: National Express sections easy to find on first page
Megabus (UK) National Express
Facebook: NO UK FACEBOOK PRESENCE
Twitter: 6,186
Tumblr: Presence (numbers not available)
Source: Megabus, 2014; National Express, 2014

13. MEGABUS .VS. NATIONAL EXPRESS
(DIGITAL)
• National Express
– Good interactivewebsite
– Lots of information for
customers as well as sales
– Easy to navigate
• Megabus
– Basic website design
– Functional (sells tickets)
rather than customer
focused information
– Difficult to find information
Source: Alexa, 2014

14. PORTER’S 5 FORCES

15. • MARKET LEADERS
– REVENUE AND EXPERIENCE
• CUSTOMER FOCUS:
– STUDENTS
– RETIRED/OVER 60S
• LOST GOVERNMENT FUNDING
• ONLINE PRESENCE
– BETTER THAN COMPETITORS
– GOOD SOCIAL PRESENCE – COULD BE IMPROVED FURTHER
• STRATEGIC ISSUES
• PEST
– TECHNOLOGY TO BE UPDATED
• COMPETITORS
– MEGABUS
– TRAIN COMPANIES
• SUBSTITUTE PRODUCT
AUDIT EVALUATION

16. • OAP CONCESSION CUTTING
– ONLINE USE OF OVER 60S?
• TRAINS
– SUBSITUTE PRODUCT
• NEW TARGET MARKET IDENTIFIED
– BUSINESS TRAVELLERS
– NOT CURRENTLY TARKETING THIS MARKET
– WILL TAKE TIME TO PUSH SERVICES IN THIS NEW MARKET
• CHOSEN SCENARIO:
TO ATTRACT ONLINE SALES FROM A NEW MARKET WITH A 12 MONTH PLAN
GROWTH STRATEGY: CONCLUSION

17. REFERENCES
• National Express Group, 2013. Annual Report and Accounts 2012.
[Online]
Available at: http://www.nationalexpressgroup.com/ar2012/
[Accessed 10 01 2014].
• National Express, 2012. About Us: History: Coach. [Online]
Available at:
http://www.nationalexpressgroup.com/aboutus/historycoach.aspx
[Accessed 11 01 2014].
• National Express, 2013. National Express - Our Markets. [Online]
Available at:
http://www.nationalexpressgroup.com/aboutus/ourmarkets.aspx
[Accessed 10 01 2014].
• National Express, 2014. National Express. [Online]
Available at: http://www.nationalexpress.com/home.aspx
[Accessed 10 01 2014].
• Tech Crunch , 2013. 73% Of U.S. Adults Use Social Networks, Pinterest
Passes Twitter In Popularity, Facebook Stays On Top. [Online]
Available at: http://techcrunch.com/2013/12/30/pew-social-
networking/
[Accessed 11 01 2014].
•
• Alexa, 2014. Site Info: Megabus.UK.Com. [Online]
Available at: http://www.alexa.com/siteinfo/megabus.com
[Accessed 12 01 2014].
• Alexa, 2014. Site Info: NationalExpress.com. [Online]
Available at:
http://www.alexa.com/siteinfo/nationalexpress.com
[Accessed 10 01 2014].
• Chaffey, D., 2012. Digital Marketing: Strategy Implementation
and Practice. 5th ed. Harlow: Pearson Education .
• Chaffey, D., 2013. The RACE Digital Marketing Planning
Framework. [Online]
Available at: http://www.smartinsights.com/digital-
marketing-strategy/race-a-practical-framework-to-improve-
your-digital-marketing/
[Accessed 10 01 2014].
• Information Commissioner's Office , 2012. Marketing and
Information Rights. [Online]
Available at:
http://www.ico.org.uk/for_organisations/sector_guides/mark
eting
[Accessed 12 01 2014].
• Megabus, 2014. Megabus UK. [Online]
Available at: https://uk.megabus.com/
[Accessed 10 01 2014].
• Mind Tools, 2013. Porter's Five Forces: Assessing the Balance
of Power in a Business Situation - See more at:
http://www.mindtools.com/pages/article/newTMC_08.htm#s
thash.cZlvPn8K.dpuf. [Online]
Available at:
http://www.mindtools.com/pages/article/newTMC_08.htm
[Accessed 11 01 2014].

18. QUESTIONS?