why bus companies should price promote more

It seems that First in Sheffield are slashing their price points for bus use in the city after a successful three month trial to see if patronage could be increased through cheaper prices.

Day and Week tickets are going to come down by approximately 40%, with Day tickets having a saving of over 25% - so all things considered, excellent value for money for those in the steel city.

To those outside the industry this approach would seem fairly straight forward. The bus is not a premium product or one where price discounting would do long-term damage to a brand, so why not make it more attractive by reducing the price significantly? A reduction of 10% isn't significant but one of 25% is - one of 40% obviously even more so.

Enough to get more people on a bus? It seems so.

To get a bus from the start of a route to the end of it costs the bus company a set amount of money - a figure that is the same whether that bus carries 10 passengers or 20.

However 20 passengers at £2.50 generates twice as much word of mouth recommendation than 10 passengers at £5, yet the revenues are the same.

Surely a bus looks better/more attractive/more viable if it looks busy (at all times of the day not just peak)? Wouldn't those on the fence of modal change be more likely to use something if more people are recommending it?

So go on, try it. You know you want to.