Zipcar

By: Amit DasAminul Islam

INTRODUCTION

Zipcar was founded in 2000 by Cambridge, Massachusetts residents Antje Danielson and Robin Chase.

As of February 2013, the company has 777,000 members and offers nearly 10,000 vehicles.

On 14 March 2013 Avis Budget Group purchased Zipcar.

The company focused on three main customers: § Individuals § Companies § Universities

S.W.O.T. ANALYSIS

Strength

Ease of use

Style of its service (cool car)

Technological sophistication (Wireless & RFID technology)

Green Benefits!!

Membership savings

No usual hassles attributed to traditional car rental like reservation after joining as a member.

Effective branding through its website and fleets by using signature Zipcar light green that symbolizes environmental friendly.

Weakness

High dependency on technology for its seamless operation like online reservation, payment and fleet management.

There is certain weakness in its marketing tactics as it is largely unknown to urban masses.

Its website failed to be search engine optimised.

Opportunities

By been environmental friendly, it is in a very strong position to entice customers who have strong view about environmental and social concern.

By establishing its presence on college, it has created a strong awareness and foothold of new generation fans.

While rising fuel costs will push people toward Zipcar.

Transit connection- fleet can be strategically parked near train or subway stations for easy access to member.

Threats

Big car rental companies like Hertz, Enterprise entering into car sharing market.

Rising petrol can be an economic burden to Zipcar since its rate is inclusive of petrol.

MARKETING MIX (4PS)Product

• Zipcar offers more than 30 models of vehicles

• All cars comes with equipped with GPS & WIFI

• Clean fuel vehicles

Price

• Provide low-cost, economic car sharing service (one-time application fee $25)

• occasional driving (from $8.25/hr and $84/day)

• extra value ($50/month then $7.43/hr and $75.60/day)

•Included with every plan: fuel, insurance and up to 40 free miles per day

• Zipsters can save an average of $500 a month compared to car owners

Promotion Print ads on public transportation

like Buses, Taxis, Subways etc Advertisement on Zipcar

properties  Free membership for merchants

who prominently displayed Zipcar pamphlets.

Online marketing IKEA-the home goods retailer-has

sponsored 14 cars bearing both the IKEA and Zipcar logos

IKEA then created "Zipcar parking only" spaces at its new store

Place Online

FACTORS THAT NEED TO BE CLEARLY GRASPED BEFORE MAKING A DECISION OF VENTURE ARE:

GLOBAL COMPETITORS

Which other companies with similar service are targeting the same market?

Do they have any advantages? If so, what (political ties, personnel from the market, etc,.)?

Do they have any disadvantages? If so, what (poor reputation in the market, legal issues at home, etc,.)?

What is their track record in new market entry? If strong, what are their methods?

LOCAL COMPETITORS

Are there any existing local companies in the target market with similar service? If so, how many?

How long have they been operating?

What is their percentage penetration of the estimated market size?

What kind of barriers will they be able to erect to the company entry?

How strong is their brand loyalty?

SOCIAL CHANGES

What kind of social changes are occurring in the target market that would affect service success?

Which changes are trends and which are new models of living?

Are social changes becoming more sympathetic to the country of service origin?

Will the service be left in the dust due to changing social taste or will it harness the next wave?

SUPPLIERS

How many potential suppliers do have currently compiled for the service?

How strong is supply chain (fiscally, historically, logistics, ability to meet future demand, etc,.)?

Are there any suppliers closer to target market who can provide the same quality but cut down on transportation / logistics overhead?

DEMOGRAPHICS

Do the demographics in target market facilitate a growing market potential or a declining one?

What is the adoption rate of the current demographics for the service?

What barriers exist in introducing the service, creating hurdles to be cleared?

What needs will the service solve?

GOVERNMENT POLICIES

Who are the key policy makers for the niche which affects the service?

Does home government have any special regulations involving trade with the target country? If so, what?

Are there any policies under development currently that would affect the market entry?

What kind of relationship does home country embassy trade consulate have with target market policy makers? Of how much help can your consulate be?

ECONOMIC CONDITIONS

What is the current trade volume of the target market?

What is the Gross National Product (GNP)?

How does the currency difference affect the venture?

What are the spending patterns of the target end user in this market?

Will your service bring value to the economic conditions? If so, how?

WORLD SITUATION

What is happening with the target market on the stage of world politics and economics?

Is it or a neighboring country hosting the Olympics soon? If so, how would this affect the company entry?

Is there civil war in a neighboring nation? If so, what kind of threat does this pose to the company sustainability?

Is the target market under international investigation/pressure for alleged support of subversive activity?

TECHNOLOGY

What is the level of sophistication of the target market as a whole?

How does the historical data on adoption of new technology/service affect the company entry and sustainability?

What are the current technology needs of the target market and does the service meet them?

What are the anticipated future technology needs and how will this affect company sustainability?

CONCLUSION

India is a perfect market for Zipcar

In 2012, EMBARQ, the WRI Center for Sustainable Transport, has been researching the feasibility of “car sharing in developing countries” a project sponsored

by Volkswagen. The team recently conducted focus groups with

potential and existing car sharing users in Hangzhou, China and Bangalore (India).

A final report summarizing the findings will be published soon.