As a regular Wandsworth Common passenger, my needs are pretty simple: a reliable service, value for money tickets that are easy to buy and good information before and during the journey – and afterwards if I'm due compensation. Safety is a given (but should never be taken for granted). Transport Focus research confirms that these things both drive satisfaction on the day and rank highly as priorities for improvement.
How tickets are sold and what passengers are buying has changed radically over the years. The relentless march to online purchase and barcode ticketing has continued – although we mustn't forget that a sizable number of people don't have bank accounts and/or access to the Internet.
Passenger behaviour post-Covid and the cost-of-living crisis has altered, to a degree, the need for some people to travel and how they do it. There is less regular commuting. Longer distance business travel is only slowly picking up. Passengers are trading down from open to Advance tickets, peak to off-peak and First to Standard. More than ever rail must sell itself, attract custom and deliver on its promises.
The Government and the railways face the same dilemma that all organisations face: cutting costs and raising income are the only choices on the way to financial sustainability. Cutting or even controlling costs on the railway has proved elusive – many costs are relatively fixed. So, boosting revenue takes on even more significance.
I chair Independent Rail Retailers, the trade body for Britain's main sellers of rail tickets. Our members are diverse in scale and activity: Assertis, Atomised, Evolvi, FastRailTicketing, MyTrainTicket, OnTrack Retail, Raileasy, Trainline, Trip.com and Virgin Trains Ticketing.
They provide a range of business-to-business travel management services and 'white label' train company online ticket retailing operations, as well as selling direct to passengers both here and abroad.
All the retailers are, as private sector businesses, perfectly incentivised to boost sales and control costs. For every pound of extra revenue generated, 95p is handed to the industry. That is an outstandingly good cost of sale. Our members now generate or handle some £5BN of ticket sales – half the industry's passenger revenue. They account for a major proportion of online sales. Retailers funded the rollout of barcode ticketing equipment across the network and pioneered split ticketing. Passengers clearly like what they are doing and for good reason!
With the advent of Great British Railways, it is likely a major review of fares and ticketing will take place. A cornerstone of that could be the 'concordat' reached between our members and Great British Railways Transition Team. This set out how the retailing landscape might look in future – allowing a parity between any state sponsored and private retailers. That concordat now needs dusting down and updating, not least because a successful future means the private and public sector working in synergy.
Our members could do so much more. The way passengers search for the right ticket for them is arcane, based on a limited question and five answer method. Airlines, hotels, Eurostar and others have much more modern systems which can allow for broader searches. Why can't we search for and be sent this type of question – 'when can I get to Brighton for £5?' or 'do you want to travel to Edinburgh this weekend for £20?'. This search ability and marketing could really help attract passengers back to the railways and can really be accelerated by the innovation that comes with competition. We are doing some financial modelling to show what could be achieved in this area.
Add to that access to all types of tickets: train companies and public authorities sometimes create products that independent retailers are then prevented from selling, from family tickets to pay-as-you-go fares. Excluding 50% of the market for your product seems counterproductive, and fairer commercial terms between state sponsored and private retailers would surely pave the way for a jump in revenue.
So, as we approach the 200th anniversary of Britain's invention of the railway, we need another revolution – a retail one. A vision that drives innovation, competition, growth, cost control and improves the passenger experience – which can all be done with private sector money. To borrow the Government's words (rather than its money), that really is a way to 'move fast and fix things'. Let's welcome more people onto trains start the next 200 years with a bang!
