Reference no: EM132136074

Commuting by subway, bus, train, or car can be expensive and inconvenient for workers trying to navigate around a city or its suburbs.

Burning all that fossil fuel (or battery power) isn’t the greenest way to travel, either. While it’s true that these modes of transportation sometimes are the most time-efficient (and the saf- est way to move during bad weather), there’s another method to consider for short hops and busy city streets: bicycle riding. Hubway is a bike-sharing system based in Boston that was conceived by its founders as a regional network tying together Boston, Cambridge, Brookline, and the surrounding communities. Hubway serves a greater purpose than just renting bikes to consumers. “It’s not just about bikes,” observes general manager Scott Mullen. “This is just another piece of the transit puzzle.” The Hubway system harbors the flexibility to fill gaps left open by public transit. For example, suppose you catch a subway that deposits you four blocks from your workplace. Instead of walking, if you’re a Hubway member, you can swipe your card at a designated bike station, grab a bike, and ride straight to your job.

Launching and running a bike-share system requires partners (Alta Bicycle Share and New Balance are Hubway’s main partners). It also requires support from corporate members. Brogan Graham, who holds the official title of hypemaster at Hubway, is responsible for corporate sales—convincing other companies to create corpo- rate accounts through which their employees may join the Hubway system. Corporations have the option to join at several levels, depending on whether they want to contribute 100 percent of their employees’ memberships or a certain percentage. Once a company signs up, a Hubway representative visits the firm to talk with work- ers about bike sharing, encourage participation, and point out the benefits of commuting via bicycle as a physical fitness and green initiative. As a motivator, Hubway provides the business customer with a tally of rides, calories burned, and CO2 saved. Hubway rep- resentatives also work with other business partners, such as retail- ers who are willing to offer Hubway members bike helmets at low cost. For example, instead of paying $50 or $75 for a bike helmet, Hubway members may pick one up for $24.99 at locations ranging from participating CVS pharmacies to City Sports to several hospi- tal gift shops. “Marketing is partnerships, communication, working together as a team,” notes Graham. Hubway has conducted several consumer-oriented promotions since its launch. At its initial rollout, marketers recruited students to dress as Minute Men and colonial soldiers and sent them out as the Revolutionary Riders to proclaim the coming of Hubway. After the first year of operation, Graham and his team calculated the top several men and women Hubway riders (by number of rides), dubbed them the Gold Club, and went to their homes and workplaces to present them with gold T-shirts. Other media picked up on these riders and featured them in articles and online postings. Some promotions involve short- term discounts, such as the recent “Get Hubway for the Holidays.” Halfway through one December, Hubway slashed the cost of an annual membership to $60 ($25 savings)—a price good until the end of that month. As Hubway approached the kick-off of its second year in operation, members were invited to grab a bike and ride to the Boston Public Library for the festivities where, upon check-in, their use of the bike for the day would be free. The first 100 riders also received a free burrito from Boloco Burritos. New members could join at the event for a reduced membership price. Hubway spread the news about the event via Twitter and Facebook—and people came in droves. Social media is an important part of the Hubway promotional mix. Hubway uses social media to spread the word about promo- tions such as the Boston Public Library event, sending targeted messages to consumers, who then become virtual ambassadors for the brand. Graham notes that a single tweet may reach 4,000 people, who not only respond to Hubway but also strike up con- versations with each other about their riding experiences, includ- ing attending special events. Without a big advertising budget, explains marketing director Mary McLaughlin, Hubway relies on this type of grassroots marketing. “The one-to-one model is the best way to spread the word,” says McLaughlin.

1. Describe how Hubway can use relationship selling to build partnerships with retailers and corporations.

2. How might Hubway create sales promotions using specialty advertising?