Magazine

Is This a Solution in Search of a Problem?

PT Editor John Van Horn struck a nerve on his blog with this Feb. 25 post about parking apps. We bring the discussion to the pages of Parking Today magazine.



A number of applications for smartphones allow you to find parking facilities and the cost of parking in those facilities. The idea is to determine before you leave home or during your trip the most convenient and least expensive place to park. Some apps also allow you to reserve a spot, often in tandem with purchasing event tickets.

I was having dinner with a very knowledgeable industry mover and shaker the other night and this topic came up. Fueled with a few adult beverages, we began to gently tussle over the topic. He took the position that using your phone to locate parking and making decisions based on pricing was the thing of the future, and we had better get used to it and plan for it. Being a contrarian, I took the opposite view.

I held that, in general, most people don’t think about parking when they leave home for dinner or a show, and that they expect that parking will be available when they arrive.  They accept the fact that they will have to pay (probably hate it, but do it nevertheless) and pick the most convenient space available.

My friend said that I was living in the 1960s, and that young people today live and die by their smartphone, and in a few years, finding parking through the use of the phone will be the only way people will do it.  He cited examples of half a dozen companies that provide this information.

We moved from dinner to the event we were attending and found ourselves sitting behind a group of twentysomethings who were chatting among themselves about this and that. I jabbed my friend in the ribs and then tapped one of the young people on the shoulder.

“When you go somewhere, say out to dinner or to a club or show, do you plan your parking in advance, and if there were a convenient app on your phone would you use it?”



The young man thought for a minute and said: “Frankly, I don’t think about parking. I just go and find a lot and turn in and park. I pay what I have to.”

Granted my survey was fairly limited, but I think that a larger sample would find a similar result. Certainly, some people will use the app and be affected by pricing and location. However, generally, prices are pretty similar in the same areas — the market takes care of that. We know that pay-by-phone receipts are a very small percentage of all revenue in cities (in the 1% to 3% range), so people aren’t fighting to jump on board that wagon.

SFpark, the MTA’s parking management project in San Francisco, is relying on apps to help people change their parking habits by providing the location and price of parking space. News reports have noted that even with relatively severe changes in pricing block by block, parking habits don’t seem to change much.

Even with a $5 per hour swing in pricing, people still park in the more convenient and expensive spots than walk an additional two or three blocks. One reason may be that they don’t know the pricing difference – that is, they don’t check parking prices and availability before heading out, and know that it’s difficult to do when you are underway in your car.

I use ATMs, pump my own gas, and often scan my own groceries. I use online check-in when I fly, and use the GPS on my phone when I don’t know where I’m going. I do all these things because it makes my life easier and more convenient.

However, I don’t really check out parking in advance, because as my younger friend mentioned above, I don’t think about it, and I’m in the industry.  I just assume there will be a fairly convenient place to put my car, and there usually is and I put it there.

Could this change? Of course. If UCLA Urban Planning Professor Don Shoup (“The High Cost of Free Parking”) gets his way and parking minimums go the way of the dodo bird, then perhaps there won’t be convenient parking and I will have to start planning for it in advance.

However, my destination (club, restaurant, shopping area, theater), if it wants my business, will most likely provide for parking, whether it’s a structure, a lot nearby, or some type of valet operation. If I find parking too difficult, most likely I will carpool or take public transportation, or not go.

But then, that’s just me. Anyone out there disagree?

JVH



I couldn’t disagree more …

I read your PT Blog daily (loved your Feb 21 post on VC funding), but couldn’t disagree more with the above.

BestParking’s iPhone and Android apps have been downloaded by over 650,000 motorists, with 5,000-plus reviews averaging 4.6+ stars. Over 350,000 unique motorists query our database every month via our website, mobile HTML5 website, and mobile apps.

We are the #1 parking application (excluding parking games) on both iOS and Android for all metrics (downloads, search placement and rankings).We’re experiencing rapid growth, with tremendous viral word-of-mouth marketing.

I agree that in Tulsa, St. Louis and Baton Rouge, a “parking finder” service isn’t necessary. However, in large cities such as New York, San Francisco, Chicago, etc., the prices do vary by $20+ between neighboring facilities. In other words, just walking across the street may pay for your dinner or the show you’re attending.

Your point – “However, generally, prices are pretty similar in the same areas — the market takes care of that” – is flat out wrong in all major cities. Just run searches on our website or apps to see why.

BestParking’s data are also deployed into GPS navigation units, including Garmin and Magellan, so motorists are relying on our data even if they’re not physically loading our apps.

Benjamin Sann

Founder and CEO of BestParking.com



But …

It’s a matter of scale. Benjamin Sann gets about 11,000 hits a day with his BestParking app. That’s not too shabby. But when you consider the total number of people driving and the total number of trips, his sample is a fraction of 1%. His numbers seem huge, but as a percentage of the possible users, they are small.

Once again, “rta” (see “Small Percentage” sidebar) adds some perspective to the discussion. Apps are a good business, and if you are making money, go for it. But again, I don’t use them for parking, and frankly I don’t know anyone who does either.

JVH



We asked the wrong person

John, we just asked the wrong twentysomething. He had more to drink than we had and a twentysomething really hot date. He was having difficulty thinking about parking, and she made it very clear during the questioning that she was getting a headache. We need to expand the survey. Clyde Wilson.

President and CEO of The Parking Network



According to the Federal Highway Administration, the average U.S. driver makes three car trips per day, and it estimates there are approximately 203 million licensed drivers in the U.S. That works out to more than 609 million car trips per day, and those drivers and vehicles need to find a parking space for a large chunk of those 609 million times per day (going to the drive-through or dropping someone off doesn’t require finding a parking space).

Based on simple math, it seems pretty clear that a parking app has the potential to be successful even if only a very small percentage of the people making those trips actually use it to find a parking space.

If we assume that somewhere around half of those trips are going to require someone to find a space, then even if only 1% of those people used an app to find that parking space, it would be almost 3.5 million hits every day.

Does a parking app actually solve a problem? Don’t know, but it doesn’t have to have widespread or global acceptance to be successful.

Your friend was right about people living through their smartphones. It’s not everybody, and it’s not even close to being a majority, but the numbers are big enough that it makes it a worthwhile market to pursue.

Wall Street, Xerox and IBM aren’t throwing money at this stuff because it’s cool, [but] because there is a good chance that they’ll get a big return.

Personally, I don’t use my smartphone that way, but I know people who do use theirs for something as simple as directions to somewhere they already know how to get to. They just like it. Don’t know why.

“rta”

Regular PT Blog commenter



 It’s a very small percentage

 

Article Abstract from April, 2013




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