Bloomfield Avenue case study: Market segmentation for buses is bad

Market segmentation, in its broadest definition, is dividing the market into subsets of consumers who can be provided with individually tailored services.  This works for clothes.  This works for restaurants. But it does not work for buses.

I’ll illustrate the problem.bloomfield-avenue-in-montclair Take Bloomfield Avenue in Essex County-  it’s one of the area’s main roads, nearly a straight line between Caldwell, Montclair, Bloomfield, and Newark.

Currently, the Caldwell-Bloomfield stretch of Bloomfield Avenue is shared between the NJ Transit 29 and the Decamp 33.  NJ Transit takes local passengers, and Decamp takes only passengers to New York.

Caldwell is considering starting a commuter shuttle service that would take Bloomfield Avenue between Caldwell and Bay Street Station in Montclair. That means there would be 3 separate service on Bloomfield Avenue for 3 separate market segments:

  1. NJ Transit buses for local trips between Caldwell,  Newark, and everywhere in between
  2. Decamp buses for passengers heading to the Port Authority
  3. Caldwell shuttle for train commuters to New York

This is a problem because frequency is one of the most important elements of a good transit service.  3 separate buses along Bloomfield Avenue will mean that riders can only use a third of the buses to get from, say, Verona to Montclair. The local rider loses out in this situation.

In a classic market segmentation situation, the market segments each get a product that suits their needs.  But for transit, part of quality is quantity.  Having local riders to fewer buses means that the local bus service between points on Bloomfield Avenue is qualitatively and quantitatively worse.

Riders going to New York on Decamp have the most to gain from this arrangement. Since the Decamp Bus isn’t picking up and dropping off local riders, the speed the New York is marginally faster.  The local bus isn’t much use to them anyway.

The train commuters from Caldwell will still have a broader range of options than the other two market segments.  They still have the choice between the local NJ Transit bus and the Caldwell shuttle to take up Bloomfield Avenue.  If one is late, they can take the other.

The real losers in this situation are the parties who are paying for bus service.  By allowing local riders onto other bus services, there could be more transit options, but provided by fewer buses. Essentially, more money is being spend on bus service than needed. If Decamp dropped off at Bay Street Station, the Township of Caldwell might not need to pay for a municipal shuttle to the train station.

Now, let’s acknowledge that there’s are reasons things are this way. NJ Transit local bus service is not that good.  Even at rush hours, you can wait 15 minutes or more for a local bus down Bloomfield Avenue. They can be slow and not always on time.  Clearly, for whatever confluence of reasons, the 29 is an inadequate means for Caldwell commuters to reach Bay Street station.

Decamp also has its reasons for not taking local passengers. Decamp might not be interested in the low fares that come from local rides,  but the primary reason is that the company is actually prohibited from doing so. Its franchise restricts its buses from competing with NJ Transit. But this is an outdated way of thinking, a relic of the time when local suburban transit service were a profitable business. But if NJ Transit dropped this prohibition, it might mean better service for its passengers. Alternatively, local service on Decamp might mean that NJT could scale back its services with no ill effect.

In times of tight budgets and little expansion to the transit system, we should focus on making the best use out of the transit we already have. This calls for a little creativity from transit providers which these days, is sadly lacking.

The three eras of train ticket collection: How far we’ve come

A pleased rider recently tweeted that NJ Transit’s mobile ticketing “is the best thing since sliced bread.”  Sliced bread is largely overrated, but we should still appreciate the huge strides the agency has made in ticketing in the past decade.

Ticket technology has actually changed twice in that period-  First we saw the movement away from cash transactions on board the train to ticket machines.  Now those ticket machines are becoming less important as people can buy their own ticket on a smartphone.

The paper ticket era:


Remember these?

In the long forgotten days before 2008 or so, at most stations you could get on a train, and the conductor would collect your fare, punch a series of holes into a strip of paper, and that was your ticket. This was largely the same way train tickets were sold 100 years ago.

It was a good system.  Buying a ticket was relatively simple for first-time riders. There was no need to buy the ticket before getting on the train. It was quick.

While it worked for passengers, this system has significant downsides for NJ Transit.  It took up a lot of the conductors’ time, and labor is expensive.  On crowded trains, the conductors and ticket collectors simply couldn’t reach everyone.  Some people got by without their fare ever being collected.

The ticket vending machine era:

The era of on-train ticket sales ended when NJT started installing electronic ticket vending machines. Within a few years, TVMs were installed at virtually every station.  Passengers would be required to buy their ticket from the machine before boarding, and then present it to the conductor on the train.

It became easier for NJ Transit to collect fares, and the workload for conductors went down. Most of this work was offloaded onto the passengers.  It was now the passenger’s responsibility to find the ticket machine and figure out how to pay.  For many riders, this meant arriving a few minutNew_NJT_TVMes earlier at the station, and potentially waiting in line to buy a ticket.

This was especially inconveniencing for riders at stations where the ticket machines were located only on one platform, and crossing between the platforms isn’t always quick. Buying a ticket on the train is still an option, but is subject to a $5 surcharge.

There were benefits for passengers too.  For the first time, it was possible to pay with debit or credit cards at most stations. It was also possible to buy 10-trip and weekly/monthly passes at outlying stations.

The mobile app era:

In 2013, NJ Transit launched its first mobile ticketing pilot, with an app called MyTix. Passengers img_5193could buy a ticket on their smartphone, and display it to the conductor. No paper required.

The app spread to other rail lines, and then light rail and bus routes.  It now has 600,000 users. Mobile ticketing gives passengers all of the advantages of the ticket vending machine but without the downsides of waiting in line for the machine, or having to arrive at the station early. Now, you can buy your ticket when you get on the train, just like in the paper ticket era. Continue reading

NJT gets a lot of heat for steal rail cuts

An update on a previous story:

In September, NJ Transit put out new train schedules that reflected the service cuts that had been approved the month before.

For some of the service cuts, there was advance warning. Riders knew to expect that the last train of the evening on the Pascack Valley Live and outer Montclair-Boonton would be eliminated. Hearings were held.  News articles were written.

In addition to these, there was a surprise.  The last trains of the evening on the Morristown line and the Gladstone Branch were cut. Nobody outside the agency knew a thing until the schedules came out with about a week’s notice.

Unsurprisingly, this did not go over well.

Rider advocates at the Lackawanna Coalition protested that without advance notice, they had no way to object to the changes.

State Senator Nicholas Scutari has proposed legislation that would require the agency to notify riders of cuts like these.

Why wasn’t NJT required to tell anyone?  Service cuts like these are regulated by federal law, and there are certain criteria for what constitutes a “significant” service cut.  If the cut doesn’t meet that threshold, it’s merely considered an adjustment.

On the Pascack Valley and outer Montclair-Boonton lines, the overall service frequency is low. The PVL only has about 20 outbound trains a day, so cutting one train means cutting 5% of the total service, which would count as a “significant” change.

Even though cutting 3 trains on the Morris & Essex is a larger service change and affects more people, it represents a smaller percentage of the total schedule.  Because of this, NJT can legally get away with failing to warn people their train is being cancelled.

This is the same way NJT managed to eliminate the north end of the 56 bus is Elizabeth, because it was considered a portion of a line, and therefore not a significant change.

While it’s unpopular, transit agencies should be allowed to cancel bus routes with low ridership, or eliminate poorly-patronized trains.  By all means, they should be able to take actions that make the system more efficient.  But I think we can all agree that they should be required to tell people when this is happening.