Ateneo de Davao University

School of Business and Governance

School Year 2016-2017
2nd Semester

CASE ANALYSIS:
Metro Ferry

in partial fulfillment of the requirements for

BA908 – Marketing Management

Submitted to:
Prof. Raymund S. Del Val
Professor

Submitted by:
Joyce Antonnette Batao
Mary Annilou Bravo
Tom Louis G. Herrera
Archie A. Labus
Mary Joy P. Lerias

December 6, 2016
 TABLE OF CONTENTS

Background of the Case ………………………………………………………. 1

Areas of Consideration ………………………………………………………… 5

 PESTLE Analysis

 Customers, Competition and Company Analysis (3Cs)

 SWOT Analysis

 Internal-External Factor Evaluation Matrix

Statement of the Problem ……………………………………………………… 15

Alternative Courses of Action …………………………………………………. 15

Implementation and Recommendation ………………………………………. 21

Conclusion ………………………………………………………………………. 25

Glossary ………….…………........................................................................ 26

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 BACKGROUND OF THE CASE
Introduction

In the late 1980s, Metro Manila experienced a crisis on its transport system. A
combination of traffic congestion and transportation shortage led the Department of
Transportation and Communications (DOTC) to introduce the Metroplex Program. The
program focused on the improvement of rail, road and river transport systems as a
solution to the worsening traffic condition and insufficient number of public utility
vehicles. The Metroplex Program included the launching of the metrotren, metrobus and
metro ferry modes of transport.

Company Background

Magsaysay Lines, Inc. (MLI) was internationally renowned for shipping and
crewing. It owned 25 ships and operated more than 200 vessels worldwide. DOTC
requested the company to operate Metro Ferry. The company was aware that it was not
a lucrative business but still accepted the offer as part of its social responsibility to the
riding public. Besides, the government had promised to support, if not subsidize, the
operations.

MLI organized a separate company, the Pasig River Transit Co., Inc. (PRTCI),
to operate the ferry service. PRTCI held an office in Ermita, employing more than 40
people. The MLI staff took care of most of its administrative work. Two staff members
from the Marketing Department handled the promotions, advertising and selling
activities.

Brief History

Figure 1 summarizes the timeline of important events affecting the operations of

Metro Ferry.

The traffic crisis in Metro Manila has been predicted by several studies of its
transport system since the 1980s. Studies suggest that substantial rehabilitation,
upgrading and improvement must be done. The national transport system was
predominantly road and water transport with traffic share of 80% and 10% respectively.
Other transport systems consist of air and rail with 9% and 1% traffic share.

Metro Manila, with an area of 636 square kilometres and a population of over 12
million had a population growth rate of 3.6 per annum. Because of its high growth rate,
the central metropolitan area had become heavily congested. This forced the population
to spread in the suburbs where housing prices were still affordable. Mass transportation

1
was inadequate to transport the commuters from their homes to their offices in the
central metropolitan area. According to former DOTC Secretary Oscar Orbos (1990),
only 15% of the more than 500,000 vehicles plying the roads were used for public
transportation. Private individuals owned the majority. The increasing demand for
transportation services had made it imperative for the government to introduce
alternative modes of transportation such as commuter trains and ferry boats.

Figure 1: Brief history of Metro Ferry operations

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Services and Promotions

Metro Manila Operations

During the initial run, PRTCI had deployed two ferry boats on the Guadalupe-
Lawton route using steel-hulled vessels, named Riverbus I and Riverbus II with a
capacity of 50 passengers each. Free rides were offered during the first week to
encourage commuters to try the new mode of transportation. The ferries operated
continuously from 6:00 a.m. until 6:00 p.m. between the two permanent stations.

Within a year, it had increased the number of its ferry boats to nine. It also added
seven stations. Due to cost and difficulty in finding space to build permanent terminals,
MLI designed and installed floating pontoons which served as temporary landing
facilities for the ferry boats and their passengers.

During its initial year of operation, PRTCI advertised heavily using “Okey ka
FERRY ko” as its catch-on campaign. This campaign was adopted from the highly
rated sitcom of ABS-CBN, “Okay Ka Fairy Ko,” starring Vic Sotto.

Also during the year, PRTCI distributed letters to companies with industrial plants
located along the banks of Pasig River to introduce Metro Ferry and at the same time
solicited support from the companies to encourage their employees to take the ferry
boats in commuting. Leaflets and flyers with schedules of the ferry and fare rates were
distributed to employees and to students from schools located along the banks of the
river.

Due to low passenger patronage in its Metro Manila operations and high
operating expenses, PRTCI had been operating at a loss. In November 1992, PRTCI
reduced to two the number of ferry boats plying the Escolta-Guadalupe route. Operating
schedule were also limited to the rush hours from 7:00 a.m. to 9:00 a.m. and from 4:00
p.m. to 7:00 p.m.

Pasig River Educational Tours

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 Metro Ferry also undertook educational field trips and a tour to Lake Island
Resort in Rizal to generate additional revenue. Guides lectured on the role of Pasig
River in the development of the nation and environmental concerns affecting rivers.

The Pasig River educational tour was getting favorable feedbacks from clients.
But due to the retrenchment program during the first quarter of 1992 in which only eight
crew members were retained, Metro Ferry could only accommodate at most 200
students at any given time.

Cebu Operations

In December 1990, Typhoon Ruping had damaged the Mactan Bridge. As such,
following a directive from the Maritime Industry Authority (MARINA), two ferry boats
were sent to Cebu to service passengers travelling between Mactan Island and Cebu
City. PRTCI was given a temporary permit to operate the said route. The boats had to
operate seven days a week because of the number of passengers crossing the straits. It
was an economically viable route since it was heavily travelled and the distance is
relatively short. PRTCI actually earned more in Cebu operations because of the
relatively higher fare for the shorter distance and high passenger patronage. Thus, MLI
applied for a permanent franchise for the said route but its application was still under
evaluation of MARINA.

Financial Highlights

PRTCI had been operating at a loss since the start of the operation in 1990.
Accumulated deficit amounted to 11.8 million pesos. MLI attributed this to low
passenger patronage and high operating expenses, particularly in the repairs and
maintenance of the vessels, remuneration of personnel and fuel consumption. The
target daily passenger patronage had to reach 3,000 per day to break-even.

To generate additional revenue, Metro Ferry undertook educational field trips and
a tour to Lake Island Resort in Binangonan, Rizal. Schools or organizations availed of
the charter service of Metro Ferry.

Metro Ferry reduced the number of ferry boats plying the Escolta-Guadalupe
route from seven to two, operating only during the rush hours. Along with this reduction,
several crew members had also been retrenched. Metro Ferry had decided this course
of action during the last quarter of 1992 to minimize its losses from operations. The two
ferry boats had to continue their operations so that PRTCI could retain its franchise on
the Escolta-Guadalupe route. The new schedule and the rotation of vessels had
resulted in reduction in fuel consumption and remuneration expenses and lower
maintenance costs.

4
5
 AREAS OF CONSIDERATION

PESTLE Analysis

To understand better the environment where PRTCI is currently operating in,

analysis of the Political, Economic, Social, Technological, Legal and Environmental
factors should be done (Figure 2).

P ↑DemandE
Lack of
S Second Hand
T L Pasig River
E
Access to public Regulated by
government Vessels/ Ferry Waste
due to traffic transportation Boats MARINA Management
support
crisis

POLITICAL

The government had failed PRTCI on the following instances:

 Failure to assist in the problem at Buting station which had stopped its operations
because of the low water level, which caused damage to the vessels. Hence,
there is a need to dredge the river particularly the said station. This was a critical
link in going to Taguig due to the presence of a jeepney terminal;
 Failure of DOTC to dredge the Pasig River and remove 19 sunken barges. These
had posed as a danger to navigation;
 Failure to integrate the METRO FERRY service into the metropolitan transport
network, which handles the master transportation program for Metro Manila, for
the proposed construction of additional terminals;
 Failure to assist MLI in coordinating, convincing and making arrangements with
Metro Manila municipal governments in securing access facilities;
 Failure to materialize the evacuation of squatters living beside some of the
METRO FERRY stations; and,
 Failure to provide permanent platforms for seven of the nine stations which
remained to be floating pontoons. This resulted to passenger discouragement
due to unsafe surroundings and impression of instability.

Had the government extended its promised support, the Management of PRTCI
believed that METRO FERRY could have been successful in its mission of easing
traffic congestion.

ECONOMIC

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An alternative and more efficient mode of transportation is needed as of that time due to
the following reasons:
 Commuters required an increasing number of vehicles for transportation. As a
result, traffic congestion had become a problem;
 Jeepneys and buses were not servicing many areas, particularly outside EDSA;
 The effort of the government in the development of LRT, PNR commuter train,
including Metro Ferry was not enough; and,
 The riding public are raising the issues on commuting, access to public
transportation, waiting and riding time, transportation expenses and degree of
satisfaction with government performance in the area.

Generally, there is a high demand for a viable mode of alternative transportation that
could solve the aforementioned concerns.

SOCIAL

The improper implementation of traffic rules and regulations exacerbated the current
transportation problems of the country. As one would travel, one would observe the
following:
 Loading and unloading of buses and jeepneys in prohibited places;
 Pedestrians jaywalking and crossing the streets at any point;
 Pedestrians forced to walk along the curb-side of roads because of non-existent
sidewalks or sidewalks being occupied by parked vehicles or street vendors;
 Commuters waiting for public utility vehicles in the middle of busy streets during
the rush hours; and,
 Many of the road sections had already reached their maximum load capacities.

Recently, the government, through the DOTC, BOI and BoC had begun to increase the
number of buses plying the main roads of the metropolis. Such move helped ease the
lack of transportation, but it has also resulted in monstrous traffic jams caused by
undisciplined drivers.

Moreover, the completion of fly-overs in the metropolis had substantially reduced

travelling time. Commuters preferred to travel the traditional way – via land
transportation – as they viewed this to be a much safer mode than taking the ferry. Also,
the opening of the C-5 circumferential road crossing the Pasig River would be expected
to cease traffic along EDSA.

TECHNOLOGICAL

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PRTCI used steel-hulled vessels to materialize the METRO FERRY project. In order to
cope with the operating loss since the start of its operations, the additional ferry boats
were second-hand vessels, which were former fishing boats. Although, the Company
did not spend on purchasing new ones, this resulted to substantially high repairs and
maintenance costs.

Although steel-hulled boats have better abrasion resistance and is more widely used,
some would argue that boats made of fiberglass or aluminum has more advantages
such as weight savings and performance increase. However, experts would suggest
that durability and abrasive resistance, which are the characteristics of steel metal, are
more important for transport vessels such as the METRO FERRY.1

MLI had estimated that they had already spent at least P1.0 million for the re-
construction of each ferry boat. However, with the passage of time, a number had
started to deteriorate due to lack of funds to be used for their maintenance. The rusty
sides of some made them look dilapidated. Several had broken seats, missing handrails
and even torn floorings.

Also, to ensure safety, PRTCI had provided enough life jackets for all passengers. In
addition, all passengers boarding the boat were insured by a comprehensive plan taken
by the company.

LEGAL

Initially, MARINA issued a Provisional Authority to MLI to enable them to operate the
Metro Ferry. In January 1990, the METRO FERRY operation opened to the public as a
joint government and private sector effort, under the auspices of both DOTC and MLI. In
time, DOTC issued a more permanent Certificate of Public Conveyance (CPC) to Metro
Ferry. The franchise given was for a period of 10 years.

PRTCI was also given a temporary permit to operate the Mactan-Cebu route. This
license has to be renewed every three years. Since the operations in Cebu was
effective, MLI decided to apply for a permanent franchise for this route. But the
application was still in process under the evaluation of MARINA.

ENVIRONMENTAL
1 http://www.yachting-pages.com/content/guide-on-aluminium-boat-hulls-vs-steel-boat-hulls.html

8
The Philippines is not excused in having a major river suffering from appalling pollution.
It has long been a challenge trying to rehabilitate the Pasig River. Environmentally, it is
pretty devastated, says Rudolf Frauendorfer, ADB. 2 Figure 3 shows the waste
management problem continuously being solved by rehabilitation programs of the
government and private institutions.

Figure 3: The need to clean-up Manila’s Pasig River3

2 https://www.adb.org/features/pasig-river-clean
3 http://citiscope.org/story/2016/cleaning-manilas-pasig-river-one-tributary-time

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Although travelling via the METRO FERRY is cool and relieving, during the summer
months, the strong fetid smell of the Pasig River is almost unbearable for commuters.
This environmental constraint indeed affects the operations of the Company.

On one hand, the government favored to increase the number of buses instead of
supporting the METRO FERRY program. Such move by the government also increased
pollution levels due to smoke-belching of poorly maintained vehicles.

3Cs Analysis
Evaluating a company’s sustainable competitive advantage and market positioning
could be based on a 3Cs analysis consisting of:

Figure 4: Customers, Competitors and Company Analysis

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ISSUES CUSTOMERS COMPETITORS COMPANY GOVERNMEN
T
Initial Transportation None, since they Accepted the DOTC
concerns system in Metro were the only request to introduced the
and Manila caused company licensed operate Metroplex
approac the commuters to ply the Escolta- METRO Program which
h to the to experience a Guadalupe route FERRY as part focused on the
scenario traffic crisis along the Pasig of its social improvement of
river responsibility to rail road, and
the riding river transport
public systems
Main Majority still There are no Increased the Failed to
conflict does not direct competitors. number of ferry support PRTCI
of consider But indirect boats to nine and has
interests Sea/River competitors are and added reneged on
transport as an the traditional land seven many promises
economically transportation terminals or to assist
viable alternative services provided stations; But METRO
and there is very by jeepney, bus or later on FERRY in
low passenger train. They caused considered to delivering its
patronage heavy traffic decrease to services to the
because people resulting to the two ferries people. Instead,
still prefer to ride need for an operating only they prioritized
buses and alternative mode during peak the promotion
jeepneys of transportation hours due to of land
accumulated transport sector
losses
Other Schools and There are small Operated an MARINA
relevant tourists availed boats in the educational/ granted PRTCI
concerns of the charter locality for the historical tour; a temporary
services of island tour but can Sent two ferry permit to
Metro Ferry, the only cater three to boats to Cebu operate
Pasig River four passengers to service Mactan-Cebu
Educational and charged passengers route because
Tour; Many US$40 per trip. travelling typhoon Ruping
availed the ferry between damaged the
services offered The Pasig River Mactan and Mactan bridge;
in Mactan-Cebu; Educational Tour Cebu; No other
The island- continued to have considered the support were
hopping tour a strong position route as provided
offered by the since they are the economically especially in
company is also only charter viable, hence, marketing and
favorable to service offering a applied for information
many tourists tour on board a permanent campaign
who are visiting ferry boat along franchise (still
the islands of the Pasig River pending)

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 Cebu having a lecturer.
SWOT Analysis
Through careful examination of the company’s strengths, weaknesses,
opportunities and threats, the management can identify where the company currently
stands and where it is heading. This analysis is helpful in the decision-making process
of the management.

Strengths:

 Magsaysay Lines, Inc. (MLI) was internationally renowned for shipping and
crewing, owning 25 ships and having operated more than 200 vessels worldwide.
 The company was granted an exclusive franchise to operate Metro Ferry, thus, it
had no competitor operating along the Pasig River.
 Metro Ferry’s charter service, the Pasig River Educational Tour, was the only
charter service offering a tour on board a ferry boat along the Pasig River having
an annotator. Because of the novelty of the project and its affordability, it gained
favorable feedbacks from satisfied clients.
 The ferry boats operated on schedule and there were no long lines nor
overcrowding on the boats which gives the ferry an advantage over buses and
jeepneys as a faster and more convenient mode of transportation.
 Safety is ensured by providing enough life jackets for all passengers and a
comprehensive travel insurance for passengers boarding the boat
 The permit to operate in Cebu given to MLI generated more income to the
company due to relatively higher fare for the shorter distance and high passenger
patronage.

Weaknesses:

 Poor information dissemination resulted to low passenger patronage. Thus,

PRTCI had been operating at a loss since the start of its operations with
accumulated deficit reaching 11.8 million pesos.
 High operating expenses were inevitable due to high cost of repairs and
maintenance of the vessels, remuneration of experienced personnel and fuel
consumption.
 With the passage of time, a number had started to deteriorate due to lack of
funds used for maintenance of second-hand ferries. The rusty sides of some
made them look dilapidated. Several had broken seats, missing handrails and
even torn floorings. All these created an impression that Metro Ferry was not safe
for public transport.

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  The incident with Manila Boat Club (MBC) members who complained against the
boat captains and crew members of Metro Ferry only showed that some of the
personnel of the company lacked proper discipline and training.

Opportunities:

 Metro Ferry provides a more convenient alternative mode of transportation to

riding buses and jeepneys. Heavy traffic congestion in Metro Manila had forced
the population to spread to the suburbs, thus requiring an increasing number of
public transportation modes to bring them to their offices and back home. Land
transportation became inadequate, such that commuters had no choice but to
walk or wait long hours for jeepneys or buses.
 Metro Ferry could take advantage of having no traffic and no unnecessary stops
and delays to market its ferry boats to busy commuters who would like to arrive
to their destination on time.
 The passenger load of the two ferry boats in Cebu had been steadily increasing.
The management had been considering to increase to four the number of ferry
boats plying the Cebu area and open three new routes if granted government
permit and support. Two of the five boats docked in Manila will be used to
materialize this plan.
 The island-hopping tour in Cebu proposed by the Tambuli Beach Resort was a
promising project, creating an opportunity for PRTCI to generate more revenues
especially during summer.

Threats:

 Traffic share of transportation by means of water was only 10% while land
transportation is at 80% with buses and jeepneys dominating urban transport.
Many commuters still prefers the traditional transport system.
 Lack of support from the government continue to pose a major threat to the
survival of the operations. The government failed to assist in many requests and
promises to support Metro Ferry operations.
 There is an environmental threat to the operations of Metro Ferry. Aside from
pollution, strong foul smell of the Pasig River was almost unbearable during the
summer months.
 The introduction of the Metro Shuttle which consisted of fully air-conditioned mini-
buses and increase in number of the Metro Bus had relegated the Metro Ferry to
the background since passengers prefer land transportation, considering it to be
safer than taking the ferry.

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IFE and EFE Matrix
SWOT Analysis summarized in IFE and EFE Matrix.
INTERNAL FACTORS EXTERNAL FACTORS
Strengths: Opportunities:
 Internationally renowned company  To provide a more convenient mode of
 Had an exclusive franchise to operate transportation compared to buses and
Metro Ferry jeepneys
 Its educational tour was the only  To gain competitive market share by
charter service offering a tour along taking advantage of having no traffic
Pasig River and no unnecessary stops or delays
 Its ferry boats operated on schedule  Expand Cebu operations by providing
 Safety is ensured by providing additional boats and opening new
complete life jackets and routes
comprehensive travel insurance  To generate more revenues by
 Cebu operations generated high engaging in island-hopping tour
income project in Cebu
Weaknesses: Threats:
 Poor information dissemination  Traffic share of water transportation
resulting to low passenger patronage was only at 10%
 High operating expenses  Lack of support and financial
 Physical condition of the ferries assistance from government
started to deteriorate due to lack of  Pasig River being known as dirty and
maintenance having strong foul smell
 Lack of proper discipline and training  The new Metro Shuttle and Metro Bus
of some company personnel gained more popularity to commuters

Figure 5: Internal-External Factor Evaluation Matrix

14
 The IE matrix and plot show that PRTCI should grow and build its position.
The company should increase strategies focused on attracting customers to consider
it as a viable alternative mode of transportation.

15
 STATEMENT OF THE PROBLEM
Make it or Break it:

Should the Company decide to continue METRO FERRY’s operations, how would the
management attract customers to consider it as a viable alternative mode of transportation
and what action plans would result to better company performance while serving/balancing
the conflicting interests of MLI, PRTCI, the government and the riding public?

ALTERNATIVE COURSES OF ACTION

Alternative 1 Alternative 2 Alternative 3 Alternative 4
Continue Manila Expand Cebu Continue to target Introduce island-
operations, even on operations by the studentry and hopping tours along
a limited basis, so increasing to four tourists by utilizing Mactan Island to
PRTCI could retain the number of ferry the remaining ferry generate additional
its franchise on the boats plying the boats for Pasig revenues for the
Escolta-Guadalupe Cebu area and River Educational Company
route introduce three new Tours
routes after
obtaining
government permit
and support

Each alternative course of action will be examined by studying the Product,

Pricing, Promotion and Placement (4Ps). In every aspect, a ranking of the alternatives
will be presented and decided to assist us in the final computation and determination of
the best alternative.

Figure 6: 4Ps of the Alternative Courses of Action

Product
Evaluating the viability of a new or existing product – to
determine whether it makes sense for the company to
launch or continue to market it – by analyzing the product’s
market attractiveness (external viability) or the company’s
objectives and resources (internal viability).

Figure 7: External and Internal Product Viability

External Internal

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 Manila Cebu
Operations Operations

Pasig River Island-hopping

Educational Tour
Tour

Pricing

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Analyzing the price means studying the 3Cs: Cost, Customer Value and Competition.

COSTS Alternative 1 Alternative 2 Alternative 3 Alternative 4

Variable -Fuel to operate -Fuel to operate
Snack, Meals/snacks,
costs the engine the engine entrance fees, entrance fees in
-Salaries of crew -Salaries of
and resorts and
members crew members commission to commission
freelancer
Fixed costs -Repairs and -Repairs and Tour -Repairs and
maintenance maintenance guide/Annotator maintenance
-Other -Other salary -Other
administrative administrative administrative
costs costs costs
Contributio Low High Low Undetermined
n Margin
Breakeven 3,000 Lower than Undetermined Undetermined
analysis* passengers per 3,000
day passengers per
day**
Results of
operations Loss Profit*** Relative Undetermined

*computed as fixed costs divided by contribution margin

**high contribution margin will result to lower breakeven point
***based on maximum capacity of 4,800 per day

Customer value is the

product’s ceiling. We
shall use this model in
evaluating the benefits a
customer gains from
availing each of the
alternatives.

Figure 8: Customer Value Model

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 Customer Alternative 1 Alternative 2 Alternative 3 Alternative 4
Value
Brand value Alternative Alternative Educational, Contribution to
(reputation/ mode of mode of historical and the tourism
promise) transportation transportation environmental industry
Product -hassle-free -hassle-free -complete -complete
value -no delays -no delays package with tour island-hopping
(Delivery/ -safety -safety guide tour package
use)
Relationship -more -more -knowledge -recreation
value convenient convenient -appreciation -attraction and
(Customer than land than land -acknowledgment activities
Experience) transportation transportation of social -appreciation
-trained and -trained and responsibility of culture,
experienced experienced tradition and
crew members crew members natural
resources

Competition for pricing aspect will focus on how much would be the substitute goods or
service that can give the same customer benefit, even when that benefit comes in a
different physical form.

Mode of Alternative 1 Alternative 2 Alternative 3 Alternative 4

transportation
Jeepney Less costly Less costly Not applicable Not applicable
than Metro than Metro
Ferry Ferry
Bus Less costly Less costly Not applicable Not applicable
than Metro than Metro
Ferry Ferry
Train More costly More costly Not applicable Not applicable
than Metro than Metro
Ferry Ferry
Small boats/ More costly
outriggers Not applicable Not applicable Not applicable than Metro
Ferry

Alternative 3 has no direct nor indirect competitors, hence, in competition pricing aspect,
no further comparison could be made.

The data used in comparing the price among other substitutes is based on the
assumption that there is similar pricing range for these modes of transportation as of
today, with necessary adjustments for inflation factor.

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Promotion
A promotional strategy consists of promotions and advertising. Promotions are short-
term incentives designed to stimulate sales of a brand-come in two major categories:
trade promotions and consumer promotions. Advertising is any public message
communicated to the consumer about a product that is paid for by the company or an
identified sponsor.

There are two strategies: push strategy and pull strategy. A push strategy uses trade
promotions to entice distribution channel members to carry and promote a product while
a pull strategy uses consumer promotions and advertising to stimulate consumer
demand for a product. A push strategy is most important for products with low brand
loyalty compared to pull strategy which is most effective with products for which there is
high brand loyalty.

Trade Alternative 1 Alternative 2 Alternative 3 Alternative 4

Promotions
Push strategy  
Pull strategy  

Placement
Placement refers to distribution or getting a product or service to the end user.
Distribution is a key factor in a company’s profitability and long-term success. Figure 9
illustrates a consolidated view of the impact of their multi-channel marketing programs
through Response Attribution.4

Response Attribution supports

multiple approaches to
measuring marketing
effectiveness based on
awareness, acquisition,
retention and loyalty.

Figure 9: Response attribution

4 http://www.experian.com/marketing-services/response-attribution.html

20
Based on our analysis, the following are the response attribution scores expected in
each alternative:

Figure 10: Response attribution

The percentages assigned represent the profit each attribute would bring to the
company. Research shows that retention brings five times as much profit than acquiring
new customers and it also costs seven times more than just maintaining them. Without
loyalty, retention is difficult; retention with good relationship with customers create
loyalty.

The factors assigned are subjective but are assistive tools in determining how much the
attributes would cost the company: 3 – costly, 2 – average, 1 – less costly. The lower
the score, the better response attribution.

It could be noted that there is a high response attribution to Alternative 3 and 4 compare
to 1 and 2.

Assessment of Alternatives – By rank (Highest score is 1, Lowest score is 4)

Our assessment of the alternative courses of action will assist us in the implementation
and recommendation of specific action plans for the company on what services should
be prioritized and what strategies to take in order to address their problem.

Figure 11: Assessment of Alternatives

IMPLEMENTATION AND RECOMMENDATION
ASSUMPTIONS: The Marketing Forecast is based on our Assessment of Alternatives.
Some marketing strategies were prioritized because of these given facts and because
of budget constraints.

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 Figure 12: Marketing Forecast

The first arrow line represents the Manila Operations, then Cebu Operations, followed
by the Pasig River Educational Tour and lastly, Island-hopping Tour.

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 Month Manila Cebu Pasig River Island-
Operations Operations Educational hopping
Tours Tours
January Free return ride Information Information Information
campaign of campaign in campaign of
new routes schools in island-hopping
partnership with tours
February Free return ride Launching of NGOs Launching of
three new island-hopping
routes tours
March Free ride for -Loyalty card Sponsor school Giving of
every 10 rides Information events discounts for
(loyalty card) campaign for advance
Sailor’s card bookings
April -Loyalty card Information Summer
-Launching of campaign in promo
May -Clean-up drive Sailor’s card radio, TV, and Summer
(Participants will (give rewards: malls in promo
be given free free island- partnership with
roundtrip ride) hopping tours) NGOs
-Loyalty card
June -Loyalty card -Loyalty card Information Summer
-Installation of -Sailor’s card campaign in promo
multi-media schools in
entertainment in partnership with
terminals/boats NGOs
July -Loyalty card Non-peak
-Information promo
campaign of
new stations,
new schedule
and the Sailor’s
card
August -Loyalty card
-Launching of
new stations,
schedule and
the Sailor’s card
September -Loyalty card Sponsor school
October -Sailor’s card events
November
December Christmas promos

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SPECIFIC ACTION PLANS: (As shown in the Marketing Forecast)

1. Free return ride – if a passenger rides the Metro Ferry on his first route in the
morning and is planning to avail of another ride (return route) in the
afternoon/evening, the return ride is free of charge.

2. Information campaign of new routes in Cebu

3. Information campaign in schools in partnership with NGOs

4. Information campaign of island-hopping tours

5. Launching of three new routes in Cebu – the three new routes will be catered by
additional two boats that were docked in Manila. Assuming the government permit
has been secured, Pier 3-MEPZ, Muelle Osmena-MEPZ, and MEPZ-Punta Engano
(other side of Mactan) and vice versa will have 1 schedule trip per day to provide
new services in the area. The schedule will be increased as needed.

6. Launching of island-hopping tours in Mactan and nearby islands – A partnership with

Tambuli Beach Resort shall be pursued under the conditions that the profit for this
venture will be earned by PRTCI and only commission will be given to the resort for
its sales booking efforts. Additional manpower will be needed in launching this
service.

7. Loyalty card – Loyalty card is a card given to interested passenger wherein each
ride will earn 1 star stamp. Completing the 10 stars in the loyalty card shall entitle
the passenger with a free ride.

8. Sponsorship of school events

9. Information campaign in radio, TV, and malls in partnership with NGOs

10. Clean-up drive – once a year, PRTCI shall host a Rehabilitation Program through a
clean-up drive in Pasig River to include Social Responsibility and promote publicity
in their program. This project can attract school institutions, environmental
organizations, private sectors and government officials who can be volunteers and
tag for sponsorships. The Metro Ferry may use a tagline to introduce its new
campaign: “Our Country, Our River, Our Responsibility.”

This clean-up campaign can also help the company to cut costs for the maintenance
of Pasig River since they will no longer be needing manpower. To compensate each
volunteer’s effort, a stub entitling them with a free roundtrip ride will be distributed.

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11. Installation of multi-media entertainment in terminals and boats – To introduce
innovation and capture the interest of the public, multi-media entertainment shall be
installed subject to the availability of technology at that time and to the available
funds to acquire such.

12. Information campaign of new stations, new schedules and the Sailor’s Card – New
stations will be opened (some re-opened) and new schedule will be adopted (may
be similar to the previous schedule 7:00AM to 7:00PM) to cater the needs of the
passengers.

The Sailor’s card is the prepaid card which could be swiped in the terminal by the
passenger who don’t want to purchase via the counter (available technology to be
determined if available). The Sailor’s card works like a cellular phone card, hence,
prepaid but not loadable. Succeeding technology may improve this loyalty card to
incorporate such feature. Sailor’s card could be purchased at retail outlets (a trade
promotions strategy). The fare charge is similar for this card because the strategy
targets convenience for passengers, rather than rewards.

Figure 13: Sample Sailor’s Card.

13. Print advertisement – Print advertisement may be in the form of brochures,

magazine articles, newspaper columns, posters, etc. Such should be available to the
passengers in the terminals or other facilities in the Metro given the available
budget.

14. Discounts and promos – Seasonal discounts and promos shall also be introduced.

15. Customer care specialist in every station with signage “Information Counter” and
boxes for Feedback forms

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 CONCLUSION
To pursue the marketing objective of the PRTCI to be a viable alternative mode
of transportation with the present traffic crisis and conflicting interests of the company,
the government and the public, decisions and strategies shall be developed based on
understanding of the marketing mix which is done by analyzing the 4Ps: Product, Price,
Promotions and Placements.

To be a viable alternative mode of transportation, PRTCI should:

METRO FERRY is the main service line of PRTCI. Hence, it should not lose sight
on its main objective. However, since the Company is suffering from losses, the Cebu
operations service line needs to be maximized in order to compensate such and
continue operating in Manila. While maximizing the opportunities in Cebu, action plans
and marketing strategies to be implemented in Manila should be directed towards
customer retention and loyalty. Furthermore, stability in the market is secured by the
Pasig River Educational Tour while market anticipation is created by the opportunity to
operate an Island-hopping Tour.

All the service lines of PRTCI, especially the Metro Ferry operations, should be
given value to be considered a viable alternative mode of transportation.

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 GLOSSARY
Map of Guadalupe-Lawton (Route of METRO FERRY)

Map of Mactan Island

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