...MAY 9, 2005 MYRA HART MICHAEL J. ROBERTS JULIA D. STEVENS Zipcar: Refining the Business Model It was October 14, 2000, and Robin Chase was leaving yet another meeting with potential providers of capital for her fledgling venture, Zipcar. Chase was CEO and cofounder of the company, which she and Antje Danielson had started some 10 months before. The idea behind Zipcar—a sophisticated form of car sharing—was simple, yet potentially revolutionary. Chase and Danielson had conducted some initial research during late 1999, and by the end of that year, the two had developed a business plan. They had incorporated in January 2000 and raised their first $50,000 from one angel investor. By June of 2000, the two entrepreneurs had leased 12 cars and were ready to open for business in Boston. By October, the fledgling company had 19 vehicles, nearly 250 members, and the founders had raised—and spent—an additional $325,000 to fund the early stages of operations. Yet, even with this demonstration of viability, Chase and Danielson had not succeeded in raising the equity capital they needed to really grow Zipcar. Beginning in early 2000, Chase had made a series of presentations to potential investors in which she sought $1 million in capital to prove the business model in Boston and, eventually, to set the stage for expanding the business to other U.S. cities. Potential investors seemed intrigued and enthusiastic about the Zipcar idea. While Chase hoped to close on this first round of financing...
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...Assignment 2.3: Case Study – Daimler/BMW – A New Breed of Driver Molicia Freeman BBA304: Marketing Management Dr. Wayman Jones International University June 15, 2013 1. Discuss environmental factors related to population that are changing the way certain people approach car buying and are thus creating new market segments. Consumers expect businesses to address environmental influence on how products and services are delivered, and to work with the natural environment instead of slowly destroying it. Also people Consumer behavior is deeply influenced by factors, such as buyer’s culture, subculture and social class and age. Each generation will search for, select and purchase a product or service for use and disposal based on personal wants and needs. Each of these groups is a different segment of the market. For example a business wants to cater to those between the ages of 17-30 they do market research to find what type of vehicle appeals to this particular group. 2. Describe the values held by this emerging group of drivers that incline them toward car sharing programs. The drivers who use the car sharing are attracted to the program because of it is affordable. The program can offer access to a car without the stress of car ownership hassles such as routine maintenance and auto insurance, nor will they risk losing their car if they cannot afford to pay it. It is also convenient for low-income households as it enables us they money they would usually...
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...1 Hi guys, I’m gonna take it from here and I’ll talk to you about the market size & dynamics, the revenue model, and the reasons why we choose zip car. So first off, I will talk about the market size. Zip car is very huge, they are in 175 counties all over the world, they are in the united states, Europe, latin America, Canada, and I believe they are looking for expanding in Australia The picture that you see on the right is a picture of a zip car wondering the streets of London 2 Zipcars target market is mainly us Young adults College students Who don’t own a car They offer a wide rage of cars, from bmws to Volvos so you can pick whatever you want whether it was the low end commercial use or the high end leisure use They are also targeting environmentally conscious people as they have added a line of electric cars called plug-ins where they run on electricity, one single charge can take you for 30 – 40 miles 3 This slide shows results for a survey that was conducted by market trends LLC and it shows some of the challenges that zip car face, The first one is that 80% of the people that have heard about zip car never tried or used it Moreover, 64% of the people feel that the price is an important factor and that they currently cannot afford zip car prices Lastly, 77% reported that they would use more of zip car if they added more car drop off locations 4 This is their revenue model and how they make profit They make profit by renting the cars...
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...Juan Francisco Marines Case Study Analysis: Zipcar (1) WHO ARE THE MAIN PLAYERS IN THE CASE? | Summary: Who: Robin Chase CEO and Co-founderWhen: October 14, 2000What: Option 1: Reach out to other investors Option 2: Create a new business model Option 3: Close the businessMain Players: * Robin Chase * Antje Danielson - * Corporate PresidentOthers * Glenn Urban – Dean and mentor to Chase * JohnSnow – Consulting Firm * Paul Covell – MIT engineer * Investors CircleAlliance Partners: * Dan Holland – Venture partner * Transit Stations * AP reporter – press coverage Competitors: * Europe car sharing companies - Swiss Mobility CarSharing, Drive Stadtauto * Rental Car Companies – Hertz, Enterprise, Avis * Public Transportation * North American car sharing companies - Common Auto, Flexcar | | | (2) IDENTIFY THE MAJOR PROBLEMS AND ISSUES IN THE CASE. | The major problem in this case is that Chase has an amazing idea, but was not adequately prepared for this type of business venture considering the time frame that she had put on herself to launch this company, and what she wanted to do for Zipcar. By setting a premature date everything seemed to have been done with a rush, even the acquisition of funds from investors for capital. Although the Glenn Urban was correct in saying the business idea was a really good idea, and having the data to support this type of business venture, however there is something...
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...“Zip car, it’s not about Cars” 1. Zip car is a unique company that doesn’t run a car rental business, instead want to change the urban lifestyle. Zip car has many benefits. It is for those who can’t afford to buy a new or a second car and who don’t want to buy a car. It is very convenient for the city dwellers. Studies showed that Zip car takes 20 cars off the road and it travels44% fewer miles than when they own a car. Zip car has a significant impact on an environment. It saves a person about $600/month when using a Zip car. The company goal is for Hipsters to not travel more than 7 minutes to get to zip car. Zip car offers convenience by providing cars nearby. 2. The belief and value associated with Zip car’s brand image is that, they say they are not a rental company, instead, selling a lifestyle to urban. One of the important things that matter to them is Environment. They are environmentally conscious. Zip car promoted green with “We love Earth.” Zip car is for all who don’t have a car. The company is always developing new features that appeal to busy city people. 3. Benefit to positioning is very important for the urban. Zip car is very beneficial to people as it saves money, mileage, gas and mechanic repair cost. The belief and values are also important, as they want to truly make people’s life easier. Both are very strong, but the benefit appeal a lot more to consumers, because consumers like to weigh the benefit over cost and decide what is more beneficial...
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...Proposed Research Topic: It will examine how the weather conditions affect the usage of the different car models offered by the car sharing service. Purposes: For Car Sharing Models it is very important to offer cars which are most needed by the customer. One factor which influences the demand of the customers could be the weather. This question has to be answered to react on the customers needs. Due to the fact that the competitive situation in this branch is under pressure it is very important for Car Sharing Models to offer cars which are most needed by the customer. To achieve a high acceptance of the customer the planning of the buying department has to be adjusted to the customer needs. The result should answer the question if the customers choose cars by considering the weather conditions. The result could be that customers are using more of convertibles when the sun is shining. Another result could be that the people are using the X1 more when it is snowing because this model has an all-wheel drive. Moreover the customers could use the other BMW models less when it is snowing, because the rear wheel drive is less comfortable and less save on a snowy underground. Another result could be that the type of the vehicle does not depend on the weather. Related work Category Title Autor General analysis of car sharing Besitzen oder Teilen: Sozialwissenschaftliche Analyse des Car Sharing (2003) Sylvia Harms General analysis of car sharing Mobilität vs. Nachhaltigkeit. Soziale...
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...people that prefer to share a car rather than actually having one due to various reasons Zip car “delivers wheels where you want them” 3 Positioning based on beliefs and values is stronger because when a company is able to build itself on beliefs and values people will share those same ideas, you are connecting with the minds of people and it can have a lot of positive effect rather than when you are concerned about the benefits experience. it allows a relationship to build and form with just as zipsters were able to experience. Establishing a strong belief and value system will allow the benefits to rise as well. 4The Company positioning and ease of access for consumers certainly sets it apart from other companies. A definite plus to Zipcar is their appeal to the green movement as the option to share cars drastically limits environmental impact. Therefore their future relies on their ability to emphasis benefits,and appeal to new emerging trends....
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...Zipcar is an innovative rental car service company –their innovation must exploit hourly car-renter-needs with unique some IT activities such as RFID, GPS, Apps, and Wireless technology. Zipcar’s strategy with its unique IT activities, including Zipstars or Ziptrips that are social networking technologies, must create more customer values and its creation should be sustainable Zipcar's growth. Also, details are following answers of Discussion Questions; 1. Threat of new entrants –are hard to replicate those unique IT activities because they already have been obtained repositories about personal experiences. Bargaining power of buyers –are reduced because of including the cost of gas, insurance, and reserved parking spots. Bargaining power of suppliers –are mainly structured leased cars, fuel, insurance, maintenance, and parking that are reduced their volume customer or wealth of customer’s information. Threat of substitute products –could not easily follow their activities because of, continuously, improving their services level with customer needs such Zipsters. Industrial competitors –Zipcar has clearly difference between their original hourly rental car service and traditional daily rental car service. 2. Their business strategy, hourly rental car service, has been sustained sophisticating IT, for instance, RFID key system probably decrease a waste of time when standing in line or filling out papers to rent a car –hourly renters must emphasize those time naturally...
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...ZIPCAR Case 1. Who are Zipcar’s primary stakeholders, and what are their particular interests? Zipcar’s primary stakeholders include their internal claimants, which are the executives and employees such as Scott Grffith; chairman and CEO, Steve Case; board of director, Ed Goldfinger; CFO, and Mark Norman; President and COO. Their particular interests are to drive Zipcar forward giving it strategic growth. They also aim maintain the business model and operations while maintaining focus on customer experience in order to expand business operations and sustain their advantage in the car rental market. Zipcar’s external claimants are all other individuals and groups affected by the company's actions. These are the individuals living in the metropolitan areas, college students and other members at universities, private businesses and government entities. Their interests include that zipcar provides easy traveling, cost efficiency, and environmental awareness. Their desire is to go from one point to another as carelessly as possible. Zipcar represents a good investment because of its use of innovative and unique technology. It provides the perfect answer for customers who wanted to rent a car for few hours in their home city. 2. Describe the challenges faced by a start-up company in an undefined market. How did Zipcar handle the tasks and uncertainties inherent in devising a new business model? Every new business will face some type of problem as it opens. You also have...
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...MKTG6MKTG6MKTG Chapter 4 Case Study: Daimler/BMW A New Breed of Driver Boasting 500,000 members, double-digit growth rates, and the largest selection of vehicles, Zipcar has firmly established itself as the leader in car-sharing programs. And while profitability for the business has yet to emerge, the demand is certainly there. Car ownership in many of the largest cities throughout the world has recently been flat or in decline, as major urban centers become increasingly crowded, with cities like Tokyo, New York, and London expected to see declines of car owners per capita over the next 15 years. Of New York residents, only 44 percent own cars. Analysts and researchers estimate 10 million drivers in the United States alone are open to participating in car sharing programs and car-sharing program memberships will rise to around 4.5 million in the United States and 5.5 million in Europe by 2016. The increasing business of car-sharing has already begun to encroach on the market for rental cars, and companies such as Hertz and Enterprise have developed their own car-sharing programs to supplement their rental businesses. Recently one unlikely group of organizations has taken its first steps in this segment as well—namely, automakers themselves. Automakers are hoping to reach this emerging target market in major urban areas—young, well-educated drivers, roughly age 18 to mid-30s, with good salaries, who are actively concerned about sustainability, pollution, and traffic congestion...
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...1. Identify the two or three drivers of Zipcar performance (deep indicators) around which strategies policies and practices can be designed or adjusted. One of the drivers that could work around the strategy would be the price of the rented cars. This is a key factor for the success of the company, it has to be lower or equal to the traditional renting companies, but it also has to be high enough to reach over the costs of the leasing, parking, fuel, etc. The cost, of course, will influence a lot on the performance. Lowering it they will be able to succeed. The one thing that they tried to lower the most was the marketing, and this seemed to really work out. The expense in marketing was extremely low, but it was very effective. Most of it was mouth to mouth, and the rest was really cheap, just by putting stickers on the cars. 2. The case data states the following: -$1.2 Million in profit/ city * 14 cities will yield $16.8 million. -0.4% population* 66 million (Exhibit 2) = 26,400 members -Which will yield $23 million in profit. -Is the opportunity big enough to be interesting? Why? To whom? In my opinion it is definitely a good opportunity. The expectations shown by these calculations in the question are very encouraging, but beyond this numbers, the company really does look good in my opinion because of the many strengths they have. It is going to provide a service that was never given before. First of all, the ease of use, the inclusion of new technologies...
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...zi9-605-054 REV: JUNE 30, 2005 FRANCES X. FREI Zipcar: Influencing Customer Behavior Anita Karr frantically gathered everything she needed for her road trip: water, her favorite “mix” CD from Javier (the ex-boyfriend), ear plugs. After years as a struggling musician her sister was making her debut as the new drummer for No Bags to Check, a performance art/hard rock band that was gaining momentum on the East Coast college circuit. The venue for this breakthrough in her sister’s career was Lupo’s in Providence, Rhode Island and Karr had to be there. Living in Cambridge a car hadn’t been necessary; most of the places she needed to visit on a daily basis were within walking distance of Karr’s Valentine Street apartment. To visit her sister across the river, grocery shop, and run errands Karr relied on Zipcar, which she had signed up for a year ago rather than continue to pay for parking, car insurance, and gas. For tonight’s trip she had reserved weeks ago, using Zipcar’s convenient online reservation system, a VW Jetta Jericho. It was 3:30 pm. Karr was scheduled to pick up the Jetta at 4:00 pm, her sister by 4:30 pm, and arrive at Lupo’s by 6:00 pm. Both she and her sister had figured that this was more than enough time to get to Boston from Cambridge, load the drums, and make Providence by the appointed hour. Karr made one final sweep of her belongings—she couldn’t find Javier’s Best of Bob Dylan CD, which she had conveniently forgotten to return—then gathered her bags and...
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...Mich ael J. Roberts, and Research Associate Julia D. Stevens prepare d this case. This case draws upon portions of an earlier case, “Zipcar,” HB S No. 802-085 (Boston: Harvard Bu siness School Publishing, 2002), written by Professor Myra Hart and Research Associat e Wendy Carter. HBS cases are developed so lely as the basis for cl ass discussion. Cas es are not intended to serve as endorsements, sources of primary data , or illustrations of effective or ineffective management. Copyright © 2003 President and Fellows of Harvard College. To orde r copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this publication may be reproduced, stored in a retrieval system, us ed in a spreadsheet, or transmitted in any form or by any means—electronic, mechani cal, photocopying, recording, or otherwise—without the permission of Harvard Business School. MYRA HART MICHAEL J. ROBERTS JULIA D. STEVENS Zipcar: Refining the Business Model It was October 14, 2000, and Robin Chase was leaving yet another meeting with potential providers of capital for her fledgling venture, Zipcar. Chase was CEO and cofounder of the company, which she and Antje Danielson had starte d some 10 months before. The idea behind Zipcar—a sophisticated form of car sharing—was simple, yet potentially revolutionary. Chase and Danielson had conducted some initia l research...
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...The proposed venture in this case study has great potential in highly populated areas with a need for transportation. Since Zipcar provides the cars in areas close to the customer, this service would be easy to use. The drawback would be finding a way to make the benefit of utilizing Zipcar more compelling over other forms of transportation such as owning a car, using other car rental services, taxis, subways, or buses. The nice component of Zipcar is that it offers hourly services which can attract people who need a car only for a doctor’s appointment or grocery run. Zipcar has been able to progress its venture which is notable since funding and parking have been an issue. Most of the funding was used to start building the wireless technology to serve as the operating system. Unfortunately, the shortcoming in Zipcar’s progression could be because the “ Z-card” reader is not finished. With no asset and few angel investors, Zipcar can seem as a risky investment. Instead of rushing to start operating the business perhaps Chase could have gained investors by guaranteeing that she had a system that functioned. Despite the technological setback, Zipcar was able to obtain 3 cars and rely on members to keep a driving log to track usage. The advantage of Chase and Danielson starting Zipcar early is that since both lacked a degree of expertise, Zipcar would be able to grow by observing customer’s usage patterns and understanding the operational and financial parameters of running...
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...Jong Hoon Lee Marketing Dr. Asuquo Onda November 20, 2014 Case Study 4 1. Discuss environmental factors related to population that are changing the way certain people approach car buying and are thus creating new market segments. Consumers expect businesses to address environmental influence on how products and services are delivered, and to work with the natural environment instead of slowly destroying it. Also people Consumer behavior is deeply influenced by factors, such as buyer’s culture, subculture and social class and age. Each generation will search for, select and purchase a product or service for use and disposal based on personal wants and needs. Each of these groups is a different segment of the market. For example a business wants to cater to those between the ages of 17-30 they do market research to find what type of vehicle appeals to this particular group. 2. Describe the values held by this emerging group of drivers that incline them toward car sharing programs. The drivers who use the car sharing are attracted to the program because of it is affordable. The program can offer access to a car without the stress of car ownership hassles such as routine maintenance and auto insurance, nor will they risk losing their car if they cannot afford to pay it. It is also convenient for low-income households as it enables us they money they would usually use for a car payment toward other household or personal expenses.  Car-sharing services also cater to certain...
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