Northern Virginia Vanpool AdVantage Program Product Development Research Study Pulsar Advertising...

Northern Virginia Vanpool AdVantage ProgramProduct Development Research Study

Pulsar Advertising Team Southeastern Institute of Research

June 22, 2004

2The Pulsar Advertising Team Southeastern Institute of Research

Background & Methodology

• A quantitative online research study among those identified by MWCOG, RADCO, VPSI, and PRTC as Vanpool Owners/Operators

• Interviewing conducted April 22 – June 8, 2004• This report based on 111 completed interviews• Maximum statistical error is +/- 8.0%


Objective

• The overall study objective:– Determine existing vanpool operators’/drivers’ willingness to

participate in the AdVantage Vanpool Program given the requirements associated with participation and the financial incentives offered.

• Specific objectives include:– Gauge awareness and understanding of AdVantage

Vanpool Program – Identify various costs of managing existing vanpools– Assess and rate paperwork/reports associated with

AdVantage Vanpool Program requirements – Identifying the defining characteristics of best prospects for

AdVantage Vanpool Program

Typical Vanpool Characteristics


Profile Of Respondents & Their Vanpool

• Who Drives the Vanpool:– Respondent: 75%

– Designated Driver: 41%

– Some Other Person: 22%

• Who Owns the Van:– Respondent or Family

Member: 56%

– Leasing Agency: 28%

– Private Party: 9%

– Employer: 1%

– Other: 6%

• Average Age of the Van:– 4 Years

• Average Round Trip Distance:– 92 Miles

• Average Van Seating Capacity:– 13 (including driver)

• Type of Insurance:– Commercial-type: 63%– Family: 20%– Uncertain: 17%

• Van Depreciation:– 44% take depreciation


Additional Characteristics

• Vanpool Accidents:– 17% have been involved in

an accident in the past 5 years

• Most Travel I-95:– I-95: 81%

– I-66: 13%

– Dulles Toll Road: 3%

– Other: 4%

• Average number currently riding in vanpool:– 11 (including driver)

• Average Monthly Fare:– $120 (per passenger)

• Average Number Receiving Metrocheck vouchers or other employer provided subsidies:– 9 passengers


Average Vanpool Operating Costs

• Per Month– Lease/cost payment: $ 771

– Fuel: $ 268

– Maintenance: $ 169

– Insurance: $ 164

– Personal Property Tax:

$ 119

– Parking: $ 72

– Parking Subsidy: $ 44

– Cleaning: $ 21

– License Plates: $ 14

– Other Expenses: $ 48

• Per Year– Lease/cost payment: $ 8,056

– Fuel: $ 2758

– Maintenance: $ 1447

– Insurance: $ 1915

– Personal Property Tax: $224

– Parking: $ 640

– Parking Subsidy: $ 434

– Cleaning: $ 217

– License Plates: $ 48

– Other Expenses: $ 543

Vanpool Owners’/Operators’ Overall Interest In Participating In The Vanpool Incentive Program


65% Would Be Interested In The Program If It Were Available Today

42% Would Be Very Interested

0% 20% 40% 60% 80% 100%

Very Interested (Rating of '5') Rating of '4'Rating of '3' Rating of '2'Not At All Interested (Rating of '1') Don't Know

Q. 15: Remembering back to the estimated subsidy, and now that you have a better understanding of the program and its requirements and associated forms, how interested would you be in participating in this Vanpool Incentive Program if it were available to you today?


VPSI Drivers May Be Slightly More Interested In the Program

0% 20% 40% 60% 80% 100%

VPSI

All Other VanpoolOwners/Operators




Realistic Level of Demand: 1 Out of 4Applying A Discount Model To Level of Interests Suggests That The Potential

Market For The Vanpool Incentive Program Could Be As High As 25% Of Those Not Part Of The VPSI Program

34%

25%

0% 20% 40% 60% 80% 100%

VPSI

All OtherOwner/Operators


Demand Discount Model

A more realistic potential for market demand can be obtained by applying a

standard demand forecasting discount model where market potential equals 50% of those

who say they are “Very interested” plus

25% of those who say “somewhat interested” in the

product concept.

Key Finding #1: There Is Great Interest In This Vanpool Incentive Program

Strategic Implication

Proceed With Program Launch – This program Will Work!

The Impact Of The Monthly Subsidy Benefit


The Longer The Round Trip Distance The Greater The Interest In The Program

Respondents Knew The Greater The Distance Traveled, The Greater The Subsidy

0% 20% 40% 60% 80% 100%

121 Miles orMore

61 - 120 Miles

0 - 60 Miles




Overall, The More Subsidy A Vanpool Qualifies For, The More Interested They Are In The Program

Chart reflects ratings of ‘4’ or ‘5’ only

0%

20%

40%

60%

80%

100%

$100 - $130 $160 - $180 $195 - $200 $295 - $325


The Following Two Slides Report On Two Questions About Insurance Subsidies As An

Alternative To Monthly Subsidies.These Two Questions Were Added At The Last

Minute During The Completion Of The Fieldwork. Due To This Timing, Only 17

Respondents Answered These Questions As Part Of The Complete Survey. An Additional 52 Respondents Complied With A Follow-up Email Requesting Their Feedback To The Questions.


Interest In Insurance Subsidies Versus

Monthly Monetary Subsidies Is Split*

0% 20% 40% 60% 80% 100%


Q 15a: Contingent on your vanpool having adequate commercial-type insurance, with a minimum liability coverage no less than $2,000,000, how interested would you be in participating in this Vanpool Incentive Program if, rather than receiving a monthly subsidy payment, we were to reduce your insurance burden by sharing up to half of your van’s insurance costs with you?* Data represents only 69 respondents or 62% of the total sample


VPSI Members Appear To Be Less

Interested In Insurance Assistance*These numbers, however, are not statistically significant due to the small sample size

0% 20% 40% 60% 80% 100%

VPSI



Q 15a: Contingent on your vanpool having adequate commercial-type insurance, with a minimum liability coverage no less than $2,000,000, how interested would you be in participating in this Vanpool Incentive Program if, rather than receiving a monthly subsidy payment, we were to reduce your insurance burden by sharing up to half of your van’s insurance costs with you?* Data represents only 69 respondents or 62% of the total sample


Few Would Choose Reduced Insurance Rates Over A Monthly Subsidy*

Though 31% have no preference

No Preference

31% Monthly Subsidy

55%

Reduced Insurance

14%

Q 15b: If you had a choice, which would you prefer to receive, a monthly subsidy (as determined by your van’s size, age, and daily round trip distance) or a reduced rate on your van’s commercial-type insurance?

* Data represents only 69 respondents or 62% of the total sample


Few Owner/Operators Would Prefer Reduced Insurance

0% 20% 40% 60% 80% 100%

VPSI


Monthly Subsidy Reduced Insurance No Preference

Q 15b: If you had a choice, which would you prefer to receive, a monthly subsidy (as determined by your van’s size, age, and daily round trip distance) or a reduced rate on your van’s commercial-type insurance? * Data represents only 69 respondents or 62% of the total sample

Key Finding #2: The Greater The Subsidy, The Greater The Interest.


Look for ways to increase program appeal for those slated to receive a smaller subsidy, i.e. vanpools with older vans that travel shorter distances and carry fewer passengers.

Vanpool Owners’/Operators’ Willingness To Meet The

Requirements Of The Proposed Vanpool AdVantage Program


Owners/Operators Are Willing To Embrace The Contract Requirements Of The Vanpool Program

But There May Be Some Challenges With Insurance & Contract Requirements

0% 20% 40% 60% 80% 100%

Have Adequate Insurance

Sign A Legal Contract

Limit Personal Van Use

Collect/Submit Reports

Maintain 3-Year History

Maintain Passenger Load

Register with COG

Designate Back-up Driver

Operate Vanpool >= 16 Working Days

Very Willing Somewhat Willing Not Very Willing Not At All Willing Don't Know

Q 13a: How willing are you to: …?


Most Vanpools Currently Meet the Program Eligibility Requirements

Meets Requirements

86%

Does Not Meet Requirements

14%

Q 12: Minimum Requirements: the driver must be at least 21 years of age and have at least 5 years of driving experience; the driver and backup driver shall not have received any more than 2 moving violations and/or one chargeable accident under the vehicle laws of any state or more than one criminal offense arising out of the operation of a motor vehicle within the past three years; the van must have a seating capacity of at least 7 people, including the driver; Vanpool is not for profit. Does your vanpool arrangement meet these eligibility requirements?


Those Qualifying For A Smaller Subsidy Are Less Willing To Limit Personal Van Use

Or Provide Adequate InsuranceChart reflects ratings of “very” or “somewhat willing” only

0%

20%

40%

60%

80%

100%

$100 - $130 $160 - $180 $195 - $200 $295 - $325

Limit Personal Van Use Have Adequate Insurance

Q 13a: How willing are you to: …?

Key Finding #3: The Vanpool Incentive Program requirements, as designed, are reasonable and most vanpools currently meet those requirements.


The Vanpool Incentive Program can work as designed.

Key Finding #4: Insurance requirements receive the least support.


Further investigation of insurance subsidy appeal, as opposed to a monetary subsidy, may maximize the appeal, and ultimate use, of the program.

Opportunity Target: Who Is Most Interested In The

Vanpool Incentive Programs


Differences Between Groups• Those with newer vans are more willing to carry the

required amount of commercial-type insurance– 62% when the van is 4 years old or less vs. 30% when the van

is 5 years +

• Those whose round trip distance is greater are more willing to sign a legal contract with the program operating agency– 88% when the round trip is 121 miles + vs. 62% with a shorter

trip

• Those with larger vans are more willing to limit personal van use– 82% when the seating capacity is 10 + vs. 57% with smaller

vans

Key Finding #5: Program has most appeal for owner/drivers of the larger, newer vans that make the longest daily commutes.


First focus on these respective prospects as the early adopters in order to build initial program sales momentum. Then merchandise success to the remaining prospect base.

Vanpool Owners’/Operators’ Views On Program

Reporting Requirements


Respondents Were Asked To View Program Reports And Rate Their Willingness To

Comply With Data Collection.

• Four forms were shown to all respondents to rate

• Each form was rotated so that no one form was displayed first among respondents

• Respondents were not asked to fill out the forms, just review them

• Questions about each form appeared roght behind each form


Monthly Attendance Form


Monthly Expense Form


Vehicle Trip Sheet


Operator Monthly Fares/Revenue Form


Three Quarters Have No Problem Reporting This Kind Of Information To The Federal Government

How willing are you to have this information submitted to the Federal Government?

0% 20% 40% 60% 80% 100%

Operator MonthlyExpenses Report

Vehicle Trip Sheet

Monthly AttendanceReport

Operator MonthlyFares/Revenues

Report

Very Willing Somewhat Willing Not Very Willing Not At All Willing Don't Know

Q. 14: How willing are you to have this information submitted to the Federal Government?


The More Frequent The Reporting Requirement, The Less Willing Potential

Participants Are To Comply With Requirements

0%

20%

40%

60%

80%

100%

ExpensesForm

Fares/RevenueForm

Monthly Reporting

1 Month/Every 3 Months

1 Month/Every 6 Months

0%

20%

40%

60%

80%

100%

AttendanceForm

Trip Form

Daily Info/Monthly Reporting

1 Day/Monthly Reporting

1 Day/Every 3 Months

1 Day/Every 6 Months

Q 14a: With regard to the ______ Reporting Form, how willing are you to comply with therequirements currently under consideration for this report as a condition to participation?


Overall, Those Interested In The Program Are MoreWilling To Comply With Reporting Requirements

Chart reflects an average of “somewhat” and “very willing” ratings for all form requirements

0% 20% 40% 60% 80% 100%

Vehicle Trip Sheet

Monthly AttendanceForm

Monthly ExpenseForm

MonthlyFares/Revenue Form

Limited/No Interest Interested

Q 14: How willing are you to comply with the requirements currently under consideration for this report as a condition to participation?

Those With Limited Or No Interest In The Program Report

“Too Much Paperwork” As The Primary Reason For

Lack of Interest (66%)*

* Data represents only 29 respondents or 26% of the total sample

Key Finding #6: The Vanpool Incentive Program reporting requirements are reasonable, though many have issues with the frequency of collection and submission. This impacts program interest and potential participation.


Give serious consideration to a simplifying the reporting requirements and frequency of reporting.

Views On Data Submission


Program Interest Would Decrease For Some If A Signature Were Required In

Filing The ReportsDon't Know

17% Decrease Interest

30%

Have No Affect53%

Q 20: What affect, if any, would it have on your desire to participate in the program if a signature were required in filing the reports, making it necessary for you to either mail or submit the data in person?


Requiring A Signature Would Have Little Affect On Those Already Interested In The Program

Interested In The Program

Don't Know8%

Decrease Interest

25%

Have No Affect67%

Limited/No Interest In The Program

Don't Know23%

Decrease Interest

47%

Have No Affect30%

Q 20: What affect, if any, would it have on your desire to participate in the program if a signature were required in filing the reports, making it necessary for you to either mail or submit the data in person?


Owners/Operators Prefer Electronic Data SubmissionTop Preference = 1, Second Preference = 2, etc.

• Email (1.7 average)• On-Line Submission (1.9 average)

• Fax (2.7 average)• Mail (3.2 average)• In Person (4.9 average)

Q 19d: What is the most convenient way for you to submit the data? Please rank the following filing methods in order of preference; ‘1’ would be your top preference, ‘2’ would be your second preference, and so on.

Key Finding #7: Electronic submission is the preferred method of reporting.


Reporting and communication efforts should be handled electronically, either online or by email.

Changes Or Improvements To Generate More Interest In

Program Participation


The Amount Of Paperwork Is the #1 Issue

0% 20% 40% 60% 80% 100%

None in Particular

Other Responses

Need More ProgramInfo

Forms In ElectronicFormat

More FinancialIncentives

Not Requiring $2MInsurance

Reduce Paperwork

Q. 17: What changes or improvements would need to be made to make you more interested in participating in this Vanpool Incentive Program?


Other Program Suggestions/Improvements

Other responses:• No adverse tax consequences

• Drop the need for commercial insurance. Insurance agencies don’t want to insure vanpools

• Advise operators/riders of pending changes in I-95/I-66 routes, i.e. HOT lanes

• Have Vanpool Driver of the Year Awards

• The state needs to help Vanpools find new riders

• Provide a list of financial services who offer low-interest loans for buying replacement vehicles

• Provide a list of dealerships who may offer a lease program for vanpool

• Signing of a contract is not good

Key Finding #8: There is too much paperwork associated with this program.


Look for ways to reduce the paperwork burden.

Miscellaneous Issues And Challenges For Vanpool

Owners/Operators


HOV Lane Usage Is the Greatest Benefit To Operating Or Driving A Vanpool

0% 20% 40% 60% 80% 100%

Other Factors

No Transit Service Available

Personal Use of Van

Makes Me Money

Convenient

Saves Time

Free Commute

Saves Me Money

Reduce Wear/Tear On Personal Vehicle

Helping Others

Use HOV Lanes

Q 29: What would you say is the one greatest benefit to you operating (operating or driving, or both) a vanpool?


Saving Time And Money Most Influenced Respondents To Become A

Vanpool Driver/Operator

0% 20% 40% 60% 80% 100%

Other Factors

Makes Me Money

Companionship

No Transit Service Available

Personal Use of Van

Free Commute

Helping Others

Convenient

Saves Me Money

Reduce Wear/Tear On Personal Vehicle

Saves Time

Use HOV Lanes

Q 28: What factors most influenced you to become a vanpool driver/operator?


New Rider Recruitment Presents Vanpool Owners/Operators With Their

Greatest Challenge

0% 20% 40% 60% 80% 100%

Collecting Fares

Retaining Existing Riders

Reporting/Paperwork

Maintaining The Vehicle

Driving Everyday

Recruiting Back-upDrivers

Recruiting New Riders

Very Challenging (Rating of '5') Rating of '4'Rating of '3' Rating of '2'Not At All Challenging (Rating of '1') Don't Know

Q 30: On a scale of 1 – 5, where ‘1’ is “not at all challenging,” and 5 is “very challenging,” how would you rate these aspects of operating a vanpool?


HOT Lanes May Impact Vanpools

No Affect32%

Lose All Passengers

8%

Don't Know24% Lose A Portion

of Passengers35%

Q 27: What do you think would happen to your vanpool if HOT lanes were introduced in the Northern Virginia area?

Key Finding #9: Passenger recruitment is a huge issue for vanpool drivers/operators.


Work closer with drivers/owners to recruit passengers / back-up drivers to maintain and increase participation in vanpooling.

Key Finding #10: HOT Lanes may impact vanpool retention, formation, and subsequently air quality terms.


HOV HOT Lane impact studies should include vanpool drivers/riders.


Recap: Key Recommendations1. Proceed With Program Launch – There is great

interest

2. Find a way to increase program appeal for those currently qualifying for a minimal subsidy

3. The program can work as designed

4. Investigate further the attractiveness of an insurance subsidy, as opposed to a monetary subsidy

5. Focus on early adopters in order to build the program


Recap: Key Recommendations6. Consider a sampling plan to reduce the

burden of monthly reporting for all program participants

7. Reporting and communication efforts should be handled electronically

8. Pay special attention to rider recruitment/retention assistance

9. HOV HOT Lane impact studies should include vanpool drivers/riders

Thank You

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