Insights 25 March 2019 By: Madeleine Funes

Let’s Be Friends: why ridesharing is an opportunity for Mass Transit

While mass transit operators in the US face pretty tough challenges, some of those—particularly ridesharing or the mobility-as-a-service (MaaS) phenomenon—also offer opportunity, provided transit operators can give riders a seamless mobile (and travel) experience.  

According to CellPoint Mobile’s 2018 survey of US ground transportation providers—Modernizing the Passenger Experience in US Ground Transportation—mass transit agencies view the MaaS movement, specifically ridesharing, as a key challenge because it has dramatically changed customer expectations around convenience and technology.  

Unlike ridesharing apps that offer a convenient, seamless way to book and pay rides, many mass transit operators don’t even have a mobile app. Instead, their booking and payment processes are often inconvenient and rely on non-digital legacy systems. Consumers expect ease of use and the convenience that mobile apps provide, and many mass transit operators simply haven’t caught up to those expectations.

Our survey revealed that lengthy procurement processes traditionally geared toward large capital expenditures confound the issue. Operators are mired in outdated selection and buying processes instead of being able to make more responsive, timely investments that address mobile payment and customer satisfaction needs.

Mobile solutions require a new approach

The good news for mass transit is that trends are headed in the right direction, with ridership increasing in many areas, especially among Millennials and urban professionals. Since both groups are app-centered and technologically savvy, this offers mass transit operators an opportunity to further increase ridership in these segments by offering a well-designed mobile app comparable to the ridesharing experience.

Before that can happen, however, mass transit operators must address their outdated procurement processes, according to CellPoint Mobile’s survey. Mass transit operators are encountering issues with implementing mobile technology, according to the survey. A full 13% of operators say that implementing mobile technology is their biggest organizational challenge, despite mobile’s inherent flexibility and interoperability with other systems. This response was most prominent among national (23%) and mass transit (20%) operators, perhaps reflecting the demand for mobile technology among the widest segments of riders, and echoing operators’ inability to meet that demand.   

Unfortunately, the average rider bears the brunt of the industry’s haphazard—or non-existent—implementation of mobile technology. Unless transit operators can address problems at the rider level—by more fully integrating mobile devices into the passenger experience—their large capital expenditures (digital railways, for example) will not be felt by the average rider and will not improve the quality and efficiency of service.

The takeaway: many transportation operators want to implement new mobile solutions that offer the ease and convenience of rideshare apps and help increase ridership and customer satisfaction. To make this happen, however, many operators will need a new, more flexible procurement process.

For more on what mass transit operators can do to increase ridership and customer satisfaction click here.