Free parking rules!

Is there a single feature that will turn your target market into customers - and in that case, what feature?

In Gothenburg, Sweden, 'free parking' when you invest in an environmentally friendly car definitely is. This is especially true in "Haga" where you can't buy parking licenses for street parking. Which shows pretty well on this image. Four out of four cars are Ford Focus Flexifuel.

Comments

[Skogstorparn]

In my vocabulary the term 'feature' is not only something associated with a product but intentionally built in or added to the product by the producer or vendor. Feature and regulation is not the same thing. The conformism shown on the picture is not the result of a product feature but of local regulation, right? Then, I can't help wondering about the city's decison process including the investment calculation ending up in the idea to pay exactly this price for 'environmentally friendly cars'. I doubt there is a deeper thought behind the initiative, nor any particular financial analysis behind the money spent but rather (political) interests to present the city AS IF it really cared. In any case, I am sure Ford was happy and the ones who got free parking felt great. Let us see how our tax money will be spent next time. What about one free beer for every 10 miles on your bicycle? Or maybe a tax deduction for those who contribute to better air by having lots of flowers and plants in their gardens. In case you didn't get it: this ain't a product feature - it's a meddlesome politicians piece of art.

[Hans Eric Melin]

I can agree the word "feature" normally is associated with the intentions of the producer. However I am more concerned with the perception of the user. And then the source of the feature normally is of less importance.

What I forgot to mention in my post was that you have several benefits if you buy a ethanol, CNG, or Hybrid car. Except for free parking you receive a tax deduction of 20-40 per cent and the fuel costs are between 10-50 per cent less compared with an equivalent gas-fueled car (not least because of other tax deductions). In some cities you even receive 15,000 SEK in cash.

However. The particular parking lot where the photo is taken is used by inhabitants in Haga and by those living in "Linnéstaden". The latter do have the opportunity to buy parking licenses, which those living in Haga haven't. Guess on what side of the lot the environmental cars are? In fact the area closest to Haga normally is occupied with some 15 Focus Flexifuels, some 10 Volvo Bi-Fuel and three Prius. The Linnéstaden side? One Prius. To me that shows pretty well that the other incentives aren't as important as free parking.

I share your concern of the use of tax money. And my point, which wasn't that clear in the post, is that most tax deductions are worthless. But some aren't, just like product features added by the producer. The tricky part is to find what features.

Finally. "A meddlesome politicians piece of art". It seems that the word "lobbying" is not that familiar to you. The success of Ford Focus shows pretty well how you sometimes should use your time and resources on communication, in this case towards politicians, as well as old-fashioned product development. In the end it's all about user perception, no matter who added the feature.

[Skogstorparn]

I now realize I didn't read your original post too carefully. So it's not really 'free parking' that creates this behavior, it is 'parking', at all, right. The Linne´comparison shows that have the car owners spent SEK 100 000+ to get the car, and then drive and insure it for another SEK 1000+ per month, then they can afford the normal parking fees. But in Haga the Focus is the only ticket to park near home and as a nice twist to that, the parking happens to be free. Obviously, it is a very strong incentive.

Again, exactly why and how the decision to introduce this little 'feature' was made, I don't know. If lobbyists were involved, I guess they did a good job, still with somewhat local success. This initiative seems not to be part of a big master plan, but maybe I am wrong (even if I doubt there will ever be a 'no parking in the city center/ city/ region/ nation - unless you drive this and that car' policy. This seems like an arbitrary decision. The consequences however, were far from arbitrary, they were very profound.

Here is my point. Why must politicians (or anyone) get into such detail of my life and even 'decide' which type of car I can drive/conveniently park if I happen to live in Haga. And what is wrong with the price mechanism to manage demand and supply (of parking spots - if that is the problem, of certain exhaust fumes, if that is the problem)? Is fx an Audi A2 1.4 TDI really so bad that it should be banned from Haga with a radius of 500m? And by doing that - what problem is solved? To me this is weird.

In this case Ford's lobbyists and PR people can't be held responsible for the decision (but if they have been instrumental/influential I have a reason not to like and support Ford - as I don't live in Haga).
What I am trying to say is this:
* (to the politicians): Please, give us a little freedom to chose how to live our life...
and this
* (to Ford or any company or PR agent who want my love or my money): Don't force me - let me want to want your fricking Focus!

[Hans Eric Melin]

1. Do you want a job? You made the point much better than I did in my orginal post: It's the enabling of parking that's the job an environmentally friendly car does for the Haga people. Thanks!
2. Audi A2 also benefits from free parking, so does SMART. Which also explain the weird concept of "environmentally friendly car" - it's not only about alternative fuels or fuel effeciency - it's about everything that can decrease CO2 emissions. Which, in turn, is another rather political dimension as CO2 ans global warming isn't our only threat to the environment.
3. In general I also think politicians should keep their hands off our individual behaviors and habits. However when it comes the big issues such as environment and energy use (and thus national security) I think it may motivated to intervene in some cases. The problem is that politicians aren't especially savvy when it comes behavioral change. For example economic incentives are highly overrated. Which I think my example shows pretty well. Since I bought my V70 Bi-Fuel I have received an increased tax deduction of 20 per cent above the 20 per cent I already benefited from. Personally I am happy with that but according to the sales statistics not too many find it especially valuable as CNG cars still lagg behind ethanol cars with only 20 per cent deduction.
5. If everything but "real" product features should sell the product, why then is Bill Gates the wealthiest man on earth?

[Skogstorparn]

1. Give me an offer I can't refuse...
2. & 3. I don't agree that economic or financial incentives are overrated. Supply/demand curves are most effectively managed by the price mechanism. When the price change/incentive is too small it may be captured by price elasticity for the target group - but then, try to increase the price difference if you want more radical results, it's as simple as that. Price works, believe me.

About the political savvyness on incentives, yes one can sometimes wonder:

- we heavily tax (increase price) on alcohol because it's bad and we want people to drink less
- we heavily tax cigarettes for the same reason
- we tax 'non-environmental'/ cars relatively higher because they produce bad CO2 that kills the environment
- we tax work, extra work, the more you work the more tax you pay because...

Anyway, my point here is: people/politicians should stick to the price mechanism and stay away from bans and silly regulations. That's because, if politicians have a measurable objective with fx the CO2 pollution, then they can drive towards that in a much more controlled and systematic way making the least negative impact on the lifes people want to live. In the context to drive towards a CO2 pollution objective - the Haga parking frenzy is totally worthless.

4. That is also a number...

5. I am not sure I get your point here. One point on Bill Gate's success though. He understood there is a risk attached with becoming a monopoly. He saved Apple from bankruptcy to make sure customers had at least one choice and were not 'forced' to go Microsoft. Steve Ballmer, on the other hand, wanted Windows to grow 25% while the PC-market grew with single digit numbers. Even if it's tempting (for vendors or politicians) to have an absolute dominant position and absolute influence on customers/markets/people it is seldom what people want. Now Steve is pretty well of too, but not as rich as Bill.

Conclusions: Work with price, not bans. Don't force - incentivice. If results are poor, work with price again and don't get tempted to use your strength to conduct violent actions on your customers.

Looking at the 'Focuses in Haga picture above, it would make the old Russian army generals on May 1st jealous...That's not a how a market, city or country should look like. Didn't we learn that some 15 years ago?

/S