Parking revenue is a crucial source of income for city administrators and parking operators. It also forms a crucial link in the parking value chain. Tech-enabled parking systems, called smart parking, have the potential to maximize revenue for authorities as well as private players. It is estimated that smart parking can increase the revenue of a city by as much as 30%.
Moreover, smart parking can also help generate new revenue streams, maximizing city collections. For example, with smart parking, parking lot owners can charge motorists depending upon the location of the parking space.
In a nutshell, smart parking will substantially increase the revenue generated, benefitting public and private players alike. Let’s explore this in detail.
How Smart Parking Will Maximize City Collections
Smart parking systems will usher in a new method to charge motorists for parking time and also for violations. They will help municipal corporations, authorities and parking operators generate increased income when compared to traditional parking systems. Here is a look at the four major ways smart parking will maximize city collections:
Implementing Dynamic Pricing
Traditional parking systems have a fixed price for parking spots at all times. While this earns the authorities and parking operators a decent income, smart parking is set to increase the revenue generated from parking lots.
Smart parking systems will implement dynamic pricing models instead of having a fixed fee. With dynamic pricing, the parking charges are based on demand and supply. Higher the demand, higher are the parking charges, and vice versa.
This enables authorities and operators to charge premium prices when the supply is low. Moreover, it also enables them to set optimum prices that can attract motorists to park their vehicles at their parking lots.
Detecting various types of traffic violations becomes simplified with smart parking and smart traffic systems. For instance, smart parking sensors can help authorities detect errant drivers who are violating traffic rules easily. Moreover, smart and connected CCTV cameras, too, can identify parking and traffic rule violations and notify the authorities automatically. This increases the fine collection and also helps enforce rules better.
Additionally, tools with machine learning capabilities can help detect the routes and locations where violations are higher depending upon the time of the day. They can then prescribe the areas to visit to the nearby patrolling officers, increasing the chances of a fine collection.
Simplifying Payment Collection
The processes associated with violation fines are tedious for both the authorities as well as the motorists. A smart parking system has the potential to simplify the fine payment process.
For example, motorists can easily pay fines through their smartphones. They will be shown a message describing the violation type and place, along with photographic and video evidence collected by smart cameras. This eliminates any discrepancy instance. They can then make a digital payment easily too. This speeds up the process of fine collection and helps increase revenue.
Monetizing Motorist Data
Lastly, the data collected can be monetized by the government as well as the parking officials. It can be sold to third parties like automobile makers who can use the data for understanding the purchasing behavior of individuals. With predictive analytics, they can predict the future preferences of motorists. Thus, they can target their marketing and advertising campaigns towards them better.
For instance, an automobile company can advertise and market its sedan cars to a person owning a hatchback by analyzing metrics, such as the number of family members traveling together and the amount of shopping done during visits to the mall. The data can be captured from the parking lot of a mall easily. The company can thus display ads of a spacious and more comfortable car to such individuals.
How Smart Parking Will Generate New Revenue Streams
Smart parking systems will enable the creation of new, multiple revenue streams that will benefit all the stakeholders involved. Here is a look at how.
Smart Parking Apps
Mobile apps are going to prove to be a game-changer in generating revenue. There are multiple ways through which operators can earn through mobile apps. Firstly, mobile apps can streamline the payment processes for reserving a parking spot and even paying for a violation. Motorists can even be offered a subscription-based or a pay-per-use model to smoothen the payment process.
Data analytics provides authorities and operators deeper insights about the traffic system, including motorist data. This helps authorities to enhance traffic efficiency by providing them with a birds-eye view of the city’s traffic and parking network.
For example, data analytics helps authorities detect when and where parking violations occur the most or the time when the parking demand is higher at a parking lot. This can help with fine collections and set premium prices for parking spots during high demand.
The apps used for simplifying payment processes can also be used for advertising and marketing processes by third parties. Local businesses such as restaurants, cafes, and retail stores can use these apps for advertising their products and services. Thus, this adds to the income source through a smart parking system.
Smart parking and meter enforcement will not only improve on the current revenue methods but also open up new revenue sources, truly maximizing city collections. Smart parking is the future of parking as we head toward smart city development. The excess revenue can then be utilized to provide even better parking and mobility services to the citizens.
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