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Report from the Annual Convention of the National Parking Association

I attended this year’s annual convention held in Hollywood, Fla. (Oct. 17, 2012). The event brought more exhibitors and industry attendees together than ever before. I had been invited by the NPA to moderate a panel focused on smartphones, cloud services and other technology trends. The panel represented one of the three main general sessions of the conference and was well attended by conference attendees.

In the following, I have captured some of my impressions and learnings from the conference:

Industry Overview

  • The U.S. parking industry is estimated to be $30 billion business. The industry is very diverse and fragmented. A small number of large parking operators drive the majority of the revenue, while many small operators make up the rest of the market.
  • Meanwhile the industry is also undergoing consolidation. Just a few weeks ago, the industry’s largest merger between Standard Parking and Central Parking was consummated. The deal was valued at about $345 million. Both companies had about 2,200 parking locations and the combined company was required to sell about 100 facilities to avoid a dominant market share.
  • Other large operators include: LAZ Parking, IMPARK (over 2,000 locations), Parking Company America Airports (PCAA) (the largest off-airport parking operators with 30 airports).

Technology Focus

  • The parking industry is very low tech and operators have traditionally been reluctant to invest in technology. The primary reasons for those concerns were lack of capital budgets and margin concerns.
  • Where those investments were made, operators primarily invested in projects around revenue control (parking is a cash business) and access systems (hardware based).
  • Due to the rapid growth of consumer mobile devices and emergence of cloud services, the need to adopt new technologies has come to the forefront of the parking business.
  • Payments, particulary mobile payments, appear to be one of the “killer apps” around parking, as it drives customer convenience AND provides customer information that may be leveraged for direct customer engagement. Several technology companies have positioned themselves in the space and are trying to work with parking operators to integrate their services.
  • A good part of the parking industry appears challenged by technology and are uncertain as to how to leverage technology for their companies. Some larger ones are trying to go it alone, others look to partnerships with technology companies to help them drive their technology initiatives. Many companies are not yet moving forward with any plans.
  • This year, the NPA announced the establishment of a Technology committee with the mandate to promote technology rollouts and to provide guidance to members.
  • Technology companies focus on the parking industry will need to walk a fine line between winning the trust of parking companies while disrupting their traditional business models.
  • Streetline has established a trusted relationship with the NPA leadership and is now heading the new Technology committee.
  • While it will likely take 2-3 years until the broader industry will adopt technology services, it appears clear that change is critical to survival of many smaller players. A number of technology players seem ready to disintermediate the operators and directly engage with the customer.
  • It is going to take a long time before the majority of players will adopt technology as a key driver of customer engagement.