Monday, July 1, 2013

Drilling down in the Citi-Bike topic

"I think comparing to the cost of a bike kinda misses the point. I often get around with my bike, but I'd love to pay for the additional option. "

comment on "A quick note on Citi-Bike" eaten by Blogger.

This is still off the main point I want to make, but based on the reaction to my last post, in which I pointed out that you could buy a new bike for less than a one year pass for the NYC bike share program, I thought I ought to spell out a couple of points.

What is Citi Bike selling and whom are they selling it to?

What they aren't selling is a general substitute for a bike, at least not for purposes of leisure, exercise or long trips. The people at Citi Bike are explicit on this point, "If you would like to use a bike for an extended period of time, we encourage you to rent a bike at a local bike shop or rental business."

Instead, the product offers a quick and convenient way of making short trips assuming clement weather and appropriate start and end points. It's important to note that the places you can go on these trips is almost entirely a small subset of the places you can go  with public transportation. The logistics of bike sharing simply do not favor the out-of-the-way destination.

If we think in terms of functionality (which, if you search on 'ddulite,' you'll see is a bit of a hobbyhorse of mine), the service looks like less an alternative to owning a bike and more like a quicker and more pleasant alternative to mass transit. This raises some interesting policy questions. If the purpose of Citi Bike is to make urban living more inviting, it makes a great deal of sense; if the purpose is to reduce congestion and carbon emissions, the case is considerably weaker.

That's what. Now how about who? Here's how I see the target market:


Relatively fit;

Financially stable and reasonably upscale;

Willing to pay a premium for convenience;

Bike owner.

I know that last one seems a bit strange but we're looking at people who like cycling and are comfortable paying $95 up front for a service. Most of those people will own a bike. There will be exceptions, such as the extremely space constrained or those heavily into a just-in-time lifestyle (who will seek out other rental options for long rides) but for the most part I see typical customers as having a bike (and sometimes a very nice one), but often not having it with them when they need it.

For this target market, Citi Bike is an excellent service and a good value. My concern is that we've gotten confused about what the program is supposed to accomplish and that the demographics of the target audience is muddling the discussion.

But more on that later.


  1. I completely agree about Vélib being a substitute for mass transit.

    But I wouldn't underestimate the importance of adding good substitutes for mass transit. In the U.S. we tend to think that transit options are all about "getting people out of their cars" and should be evaluated in that way. But adding mass transit options is a good thing in itself. For one thing, this takes a load of of existing transit resources which are strained, in addition it's always good to have more transit options, just as it's good for drivers to have both surface streets and freeways.

    Regarding users: don't forget tourists and temporary residents of a city.

    1. If we put aside, opportunity costs (which complicate the picture greatly), bike share programs are pretty much all to the good. My concern is that what looks like a pretty good idea for improving urban transit and quality of life is being treated as a climate change solution.

      For example:
      "You probably think that bike-sharing programs are a modest, environmentally friendly way to give people another option to the fossil-fuel-based car culture that dominates our major cities."