How digital transformed Secure Parking’s business
Over the last two years Secure Parking has shifted all of its marketing from traditional above-the-line methods to focus entirely on digital and online marketing. The success of this transition won the company two Australian Business Awards this year, for marketing excellence and best new product.
Secure Parking owns and operates 250 car parks around Australia including car parks in the CBDs of Brisbane, Sydney and Melbourne, making it the largest car park operator in the country.
Marketing spoke with Secure Parking marketing manager Andrew Sapir about why the company chose to switch up its business model and how a digital strategy is what the parking industry needed.
Marketing: Tell me briefly about how Secure Parking changed its business model.
Andrew Sapir: The way our business model has worked is that we don’t actually see the car park as a destination, we actually see anything going on around the car park – be it business, entertainment, leisure activities going on around the car park – as being the reason that people park in that car park.
One of the challenges for the parking industry is that there’s always been a perception that parking is expensive and hard to find and it’s also very much a grudge purchase. Everyone always complains about the cost of parking. What we recognised a long time ago was that we could actually lower the barriers to parking by making parking more accessible and make price less of a barrier.
We introduced this product called Club-Secure and that was about 10 years ago. The idea of that was that you go to our website, you registered as a member and you got access to a bunch of vouchers that you could download and then use to get discounts in the car parks. Through a whole heap of research and changing technologies we identified that our customers actually wanted a much simpler system. What we did was introduce an online booking system called Secure-A-Spot.
In most cases the Secure-A-Spot rate is cheaper than the drive-up rate. In some cases, like evening and weekend parking can be as much as 60% to 70% off the drive-up rate. People see it as a huge call to action. If you research you can actually park cost effectively.
Secure-A-Spot has really reduced the barrier to entry to the market. As a result, it’s been very, very successful. Not only driving revenue for the business but building us a really loyal database of customers.
We’ve always had a bricks-and-mortar type of retail approach where we use a lot of above-the-line techniques and a fairly standard type of model. We’ve changed our model now to be very much around digital marketing. We’ve had huge, huge success by adopting that model.
M: You mentioned you conducted market research. What type of research did you conduct exactly?
AS: We conducted an omnibus survey in about 2010/2011. The reason we did that was because we had always run the business based on a bunch of assumptions. What we wanted to do was either prove or disprove those assumptions. We went out to independent people in the market just to understand what parking meant to them and what the barriers to entry for parking was or what the attractive things about parking was to build a much better understand of what the general public thinks about parking. Also, in terms of the future, how they want to transact with us.
One of the things that came out of that survey in 2010/2011 was that they wanted an app, at that stage.
What we’ve also done is between 2011 and 2013 we were running surveys through our website. As a result of those surveys we launched a new website at the end of 2012 based on our customer feedback. We’ve always tried to build our feedback based on what our customers are telling us they’re looking for.
What also came out of those web surveys was our customers were telling us that they wanted a much simpler way of redeeming Go-Secure and we saw an online booking service, given that there was such a high propensity for people to purchase anything online, that we thought that was a good opportunity for us to introduce online booking into our business. Therefore, we built Secure-A-Spot, again that was based on customer feedback.
M: You found that people were finding parking to be a ‘grudge’ purchase, you’ve tried to make it a ‘convenience’ purchase. Can you elaborate on what that means?
AS: Parking has two aspects to it. If you’re a business customer, generally speaking, it’s about convenience. It’s about being as close to the destination as possible because in many cases, if you’re parking for business, your work will be compensating you for the parking.
When it comes to the average consumer, so people parking for their leisure activities, they are a lot of more price sensitive. What Secure-A-Spot has done is lower the barrier to entry which was previously price and basically made it a much more attractive proposition by offering the customer both a price point which they find acceptable and the product being a lot more convenient on offer.
M: Tell me a bit more about the app and the website. You said you created that in-house?
AS: We’ve got the Secure-A-Spot booking engine and the Go-Secure app. Go-Secure is the mobile access point for the booking engine. We built Secure-A-Spot ourselves because we didn’t think there was anything on the market that could deliver us the type of solutions we were looking for. The parking industry is very similar to the hotel industry or the airline business; once a day has past and you’ve got empty bays in that car park you can’t sell those bays so we really have to work on a very solid yield-management strategy. We want to try and get as much demand into that car park on a daily basis so that the vacancy is minimised.
M: Around 40% of Secure-A-Spot bookings are from new users. Are you still growing your user base?
AS: Absolutely. We’re very reliant on all forms of digital media. We use Adwords extensively and focus a lot on SEO. What that’s enabled us to do, because we’re so focused on them and we’re pretty much working on it on a daily basis we can tweak the campaigns to make sure we’re getting the maximum results.
What we’re able to capture is anyone who is doing the research on parking, we’ll probably be the first car park operator that they’ll see. Because we focus on compelling offers that hit that price point that are really attractive we get a lot of click-throughs. For instance, our Adwords activity is clicking through at anywhere between 15% and 16% and we’re getting conversation rates of anywhere between 35% and 40% per sale. Huge volumes of our business is through SEO. Generally speaking, in terms of total users, we’re getting anywhere between 70,000 and 80,000 users a month, of which about 25,000 or 30,000 are new.
When we’re working with the data we know who’s a new user, who’s an existing user and the product is still growing substantially. To be honest, we’re finding through our surveys that a lot of the growth is also a result of word-of-mouth. People are getting a good experience with the product and talking about it to their friends. There’s still a lot of work to be done in terms of the opportunities out there, but what we’re finding is that just through word-of-mouth people are using the product, having a really good experience of it. It’s still quite unique, the idea of booking parking online.
M: Run me through your marketing strategy. How did you come to the decision to move everything online?
AS: It’s a natural progression when you’ve got an online product. But I think what we had to before we went onto a full blown digital strategy was we had to re-educate the market. Traditionally people had gone to our website to research where they were parking. Then once they found somewhere they were going to park they drove to the car park knowing what price they were going to be paying. We had to pretty much create awareness about Secure-A-Spot and re-educate the marketing about booking online. The first six months of the life-cycle of Secure-A-Spot is all about education, changing behaviours and creating awareness about this really convenient product that would guarantee you parking in the city and save you money on the drive-up rate.
Once we believed we had the traction in the marketplace, the awareness was out there and people were understanding how the product worked we then focused on an acquisition strategy. The idea was to try and get as many people to try the product as possible and that’s through commitment to pay-per-click, SEO, social media – we connect ourselves to events. We use social media to target certain events. For instance, if there’s an AFL game going on down in Melbourne we’ll use social media to target people we know are interested in those events and we’ll send them out a really compelling offer saying ‘if you’re going to the game tonight, here’s $5 parking, click here to book online’. Social media has been very, very effective for doing that.
Once we’ve got people in our database we use a retention strategy to keep them on board by sending them emails on a regular basis. The kind of emails that are really effective and working is a ‘What’s On’ email, which basically tells people the best events going on in the city that week and if you’re heading into those events, here are the best parking deals for that event. We’re getting really good traction in the sense that people love it because everyone goes to something in the city every now and then and we’re hitting the right nerve with people if they’re heading to an event it gives them a really good cost effective price point for the parking. Because they’ve used the product before we don’t need to sell the service again, we just need to say ‘hey, you’re going to this event, here’s the best parking’. We’re getting huge conversion rates from those kinds of emails.
We also do book and win promotions as part of our retention strategy. Every time you book you’ll go into the draw to win some pretty compelling prices. One of the other aspects we’ve done that’s proven to be really successful, is we’re a partner of a number of loyalty programs, including Qantas Frequent Flyer so when you make your book you earn Qantas Frequent Flyer points. We actually segment the offers so that if you’re parking off peak you can earn more points than if you’re parking during peak hours because we want to try and create stronger and more compelling reasons for people to park off-peak. That’s been a very successful partnership with Qantas.
One of the challenges for our business when parking in a bricks-and-mortar operation, we never knew who they were. Because a lot of the car parks are unmanned we’d never actually know who they were. What Secure-A-Spot has done has enabled us to capture the name and details of the customer and actually start to build a relationship with them. We’re getting to the point where we can build one-on-one relationships with them because we know what type of offers they’re redeeming and what type of parking they’re booking.
We can change the messages we’re sending to them to make them a lot more relevant and that’s one of the key drivers into why we’re so successful. We’re sending relevant messages to the market based on what we know about them or what their purchase history is or what their transactional history is. People don’t find the emails intrusive.
M: You’ve outlined a lot of the pros of running an online/digital campaign. Were there any cons?
AS: I think the beauty that we’ve had with the digital marketing strategy is because being digital is immediate, the second you see anything not quite working you have the ability to adjust your strategy on the run. If you’re not watching your digital strategy you’re going to hit cons all the time because you’re not managing the campaign the way digital is meant to be run. If you’re constantly watching what you’re doing and using it for the benefits of what it’s there for, the fact that it’s measurable, you start to understand what campaigns work, what campaigns don’t work and you adjust your strategies accordingly. That’s where we’ve been really successful. We’ve really kept an eye on everything that we’re doing to make sure that we’re funding our digital advertising spend into the campaigns that are the most effective.
Whenever we’re running any kind of offers or any campaigns we’re constantly fine-tuning the campaign, we’re constantly looking at our big strategies, we’re constantly looking at what type of keywords are working, what keywords aren’t working to make sure we’re maximising efficiency in those campaigns. It’s become a real science within our business and the best thing for it is that we’re able to account for every dollar that we’re spending on our digital strategy and be able to report back to management about what’s working and what’s not working. Rather than the traditional forms of marketing where there was always the element of assumption in what we were doing.