http://www.engineeringnews.co.za/articl ... 2011-04-08
Rail agency appoints marketing management agency
By: Henry Lazenby
8th April 2011
Updated 3 hours ago
The Passenger Rail Agency of South Africa (Prasa) has awarded a concession to the Umjanji Media Consortium, led by commuter advertising specialist Provantage Out of Home Media, to manage its advertising and media portfolio.
The five-year concession was awarded on March 1, and includes all advertising and media coverage on Prasa’s trains, terrains and stations. The concession forms part of a large-scale infrastructure development and upgrading recapitalisation programme of about R25-billion.
Provantage MD Jacques du Preez explains that, in the past, there were multiple concessionaires, operating in various regions across South Africa. These have now been consolidated into one concession.
“We were appointed to take Prasa’s advertising and media portfolio to a new level. Prasa has made an implementation team from their side available as well and, together, we are hoping to take rail commuter marketing to a new frontier in South Africa,†Du Preez says.
He explains that, when many concessionaires compete against one another for the same advertising spaces, one rarely realises the premium potential market value of the advertising sites. But, by giving one entity control over all the advertising coverage, one is able to gain the highest potential revenue.
The concession includes all the broad- casting, advertising and media rights for Prasa. It encompasses billboard advertising inside Prasa rail reserves, stations and buildings, all the interior advertising, hanging banners, light boxes, ticket offices, and even advertising on the back of train tickets.
It also entails the branding of the exteriors and interiors of trains and the company’s Autopax buses. Du Preez adds that there are many new in-station brand activation opportunities.
Provantage is currently undertaking site audits at about 159 stations to take stock of existing media opportunities and identify potential new media opportunities and consolidate existing contracts with advertisers.
He reports that, while the process of auditing the stations will take about three months, the company is already engaging media buyers and selling advertising space.
The company manages the advertising rights for about 160 stations.
Further, Du Preez adds that several interactive media opportunities will be created at stations. This includes all digi- tal and interactive advertising opportunities, such as mobile phones, and the launch of a digital network at the top stations, where multiple television screens will be added to disseminate news, weather reports, journey-related information and advertising.
Further, Prasa is busy with major station upgrades across its system, ensuring that stations are cleaner, safer and more efficient. This has resulted in the need to re-educate the advertising market that rail commuter marketing is an excellent, virtually untapped opportunity.
“The aim is to add value to the customers’ travelling experience. This is a global trend, because, if a benefit is added to the advertising medium, consumers are more likely to accept the intrusion,†he explains.
“There is a virtually untapped audience of about 3,7-million rail commuters a day, who, by default, are all economically active. It is a conveniently filtered audience,†Du Preez points out.
However, he says that Provantage is facing some significant historical chal- lenges.
Most of Prasa’s rolling stock dates from the 1950s and 1960s, making it outdated. But Du Preez is optimistic that, with the new infrastructure upgrades and new rolling stock acquisitions being implemented, rail commuter marketing opportunities will increasingly become more attractive.
New Rolling Stock
Prasa has announced that it intends to invest significantly in new rolling stock for its Metrorail commuter services and long- distance Shosholoza Meyl train services over an 18-year period.
Transport Minister Sibusiso Ndebele announced in March that Prasa would embark on a market engagement process to evaluate the interest from role-players to construct new rolling stock for South Africa’s ailing rail system.
“There is a need for reinvestment in both the existing network and new routes in response to new post-Apartheid spatial and economic dynamics. Through various processes, rail projects of strategic importance have been identified.
“We need focused intervention on some of our key passenger and freight corridors. Most of these corridors not only offer us the opportunity to drive a focused rail revitalisation programme but will also help to achieve a coordinated implementation, which includes our road network, ports and the development of specific urban and rural transport modes along the corridors,†he said.
Audit, tax and advisory services firm KPMG director for corporate finance De Buys Scott says that KPMG forms part of a consortium that is the transaction adviser to Prasa for the acquisition of new rolling stock.
The consortium consists of fleet management specialist Interfleet Technology, legal consultant Edward Nathan Sonnenbergs and consulting engineering firm Arcus Gibb.
“We were assigned to undertake a feasibility study for the acquisition of new rolling stock for Prasa. Once the report is finalised, Prasa will consider the report in its internal processes and eventually present it to the Department of Transport for approval.
“If the study is approved at all levels, the fleet renewal project will progress to the next phase,†he explains.
He says that Prasa is now focussed on a market engagement campaign. “We hope to get all the prominent rolling stock manufacturers from around the globe together at the start of April, including all interested funders, to gauge the project’s appeal to the market.
“We will also look at the manufacturers’ ability to supply the required quantities of rolling stock to the required specifications, the acceptable level of supply to allow for the rolling stock manufacturers to provide a local manufacturing and assembly plant, and consider the financiers’ ability to provide long-term finance for the rolling stock fleet renewal programme,†says Scott.
He adds that the rolling stock manufacturers will need to be able to build about 300 coaches a year and establish a local manufacturing plant. This will aid local job creation, while also enabling technology transfer from original-equipment manufacturers to South Africans.
“The market engagement process will assist us in finalising the feasibility study of the rolling stock renewal programme,†Scott concludes.
Edited by: Chanel de Bruyn