1. How would you characterize the service that Zipcar provides? Why does Zipcar exist? What consumer needs was it designed to meet? Which firms are its competitors?
Zipcar is in a nut shell a US headquartered car membership based car sharing program that provides automobile reservation and use to its members. This concept started in Boston by two entrepreneurs named Robin Chase and Antje Danielson in the end of 1999. This year 2013, a deal was struck where Avis Budget Group acquired Zipcar for $500 million in cash, becoming a subsidiary of the group. The company provides a great service to its members by being able to let them reserve a car a year or even minutes in advance charging an hourly rate or for the day. There is not hassle with a Zipcar automobile, the hourly fee usually as low as $4.50 (depending on the city) covers all expenses from fuel, insurance and maintenance.
This way of car sharing through memberships is very unique and it really goes into how through the use of modern technology (self-service) one can create a revolutionizing business or concept. Zipcar’s service solves an overwhelming need for young adults living in the city (generation Y). Zipcar targets those individuals who live in dense metropolitan areas. College students also benefit from this type of service, those that are in big state schools or universities. The issues of parking, insurance and monthly car payments are long gone with Zipcar’s business concept. They really meet exactly what the customer was looking for, which is to be able to use a car or automobile for a short time period and not worry about the big problems that arise when owning a car in any big, dense city which is parking, gas and insurance. This concept in a way gives members a perception that they own the vehicles per say, but with the a lot less responsibility/commitment.
Today many firms within the car rental business have adopted methodologies and strategies pioneered by Zipcar. Companies such as Entreprise, which in my perspective is the closest peer to peer competitor, have announced car membership sharing campaigns. Other companies such as Uhaul, Carpingo, Cars2go and others have almost the same concept but what might vary is the car type/model and obviously locations. They are also other forms of car sharing services offered by companies that can really be a good competitor to Zipcar. These companies offer members privately owned vehicles that are shared/loaned to them and used for a couple of hours for a fee, paid directly to the owner of the vehicle and probably pay a commission to the company. Any company where someone needs to pay for a use a vehicle/automobile is a competitor of Zipcar. 2. What is the customer motivation for choosing Zipcar? Do you agree that Zipcar is a very large move towards self- service (that the customers are having their operating role as customers being expanded, and they require no benefits or salaries to be paid)? Please explain your thoughts on this.
Customers are motivated by Zipcar because of its convenience and reliance. As mentioned before, once you become a member of Zipcar you feel that you are indeed an owner of a vehicle. Also, not having to worry about parking the car when you are finished with it, insurance and monthly car payments are all the benefits and motivation the average young adult who lives in the city must have to become a member of Zipcar. It really is a win-win situation for the person who is constantly on the go, who likes taking public transportation and occasionally needs a vehicle to resolve issues. Zipcar’s services can be described as a large move forward towards self-service. Members really have to do some tasks, but these tasks are not far from the tasks done when doing a traditional car rental. Filling up gas towards the required amount once the car is returned, leaving the car parked in the same spot/same way it was parked and paying high fees for any penalties or late return are all of the same tasks when choosing Zipcar. Although there is some difference when being a member of Zipcar, you really do not have to deal with lines or other people in the back of the counter as well as wait for an employee to bring you the car around from the parking lot. The experience in a way is the same from renting a car but different because it is more of self-service rent a car.
In my view, Zipcar self-service model has its advantages and disadvantages, first your really do not have to deal with any disgruntle employee when taking out a car, with this concept you are doing it all by yourself. Second, you have even better options to take different types of cars with Zipcar than a normal rent a car (type, color, model, etc.). On the other hand, there are many disadvantages of using Zipcar. First, it can be a little more expensive than conventional car rentals. Per day traditional car rentals are definitely more inexpensive, but per hour rentals Zipcar has the edge. Second, car rentals seem a little old fashioned now a days, Zipcar is the better “hipper” choice. At the end, it all goes down to what you are looking for in a car rental and where you live. Zipcar is meeting and exceeding consumer needs within heavy populated cities and creates value to them in an innovative way.

3. What are the critical factors that influence the customer experience?
Zipcar membership and experience is considered to be somewhat radical to the norms of car renting. Still, this modern company rose in an era of customer-centricity and instant-feedback-sharing has inspired overt negativity indeed worth discussing. And upon further review online, it is clear to say that Zipcar’s customer experience is indeed veering off the course. The reviews coming in from members make it abundantly clear that they are underwhelmed. But as the innovator and leader in the space, Zipcar is supposed to represent the best. It is supposed to be the standard. With no inherent reason to lag behind other services or fall short, any such shortfall can be directly attributed to a flawed service experience. Although they have had a bad review in the recent years of operations due to bad customer service over the phone and online, they still create value to its members.
There are many critical factors that influence the customer experience within Zipcar’s concept. First, members or customers feel, as mentioned before, like they own a vehicle. Members really feel like they have ownership of the car, without the hassle of paying for gas and insurance. Also the option of parking is also another perk, since most of the Zipcar locations within a city, being everywhere, it is very easy to find parking. Second, members really feel more in control about the vehicle because they just need to reserve the car that they want, pick it at the nearest location they have indicated in the reservation and drive away. If the car is low in gas, on top of the wind shield on the driver’s side there is a credit card that can be used to fill up the tank or enough to when you are finished with the car you return it and park with at least one-third tank of gas. Third, although having bad customer reviews, it still has some sort of support that can go beyond what you receive from traditional car renting agencies. Finally, the self-service experience is unique because you are in total control of the car from initial reservation to last minute return. 4. What mechanisms do they have in place to manage consumer behavior? What are they intended to accomplish? Are there, if any, adjustments you would recommend that the company should make to better manage consumer behavior?
Zipcar has various mechanisms in order to properly manage consumer behavior. Zipcar’s online complaint handling, which would provide the most vivid, public glimpse into how a business is approaching customer negativity (especially for a business that uses email, phone and social media as its key support channels), suggests that an attitude of protected satisfaction might be reigning within the organization. Also, as an online article can point out, Zipcar’s Twitter interactions reveals that the organization far prefers to engage with positive feedback than negative commentary. While the company is right to notice and respond to its loyal supporters, its disregard for frustrated ones is both troubling and unintuitive in an environment predicated on fixing customer dissatisfaction.
Even if one temporarily ignores the importance of customer service, there is little marketing rationalization for Zipcar’s effort. Cultivating loyal brand advocates is valuable, but managing customer complaints and preventing customers from leaving are also huge marketing objectives. With a strategy that discharges those elements, Zipcar is not using social media wisely. It is not conscious of the manner in which social, by virtue of empowering word-of-mouth, can affect reputation. Of course, one should not ignore customer service, and the poor response times are an issue there. While negative responses are not the only responses Zipcar ignored, it has overlooked some positive and neutral comments, making them seem like they are far less capable of attracting the company’s attention.
Problematic from a perception issue it suggests that Zipcar does not care about righting its wrongs, it is also problematic from an experiential perspective. Based on reviews and other articles online several of the complaining customers were referencing either ongoing issues which were the ones that needed resolution or the ones that could prevent them from successfully doing business in the future. Without resolving these issues, Zipcar is not only belittling its customers but also not upholding its commitment to serve them.
In all when it comes to an insufficient, ineffective customer care platform, Zipcar is far from alone. Many organizations today are as or even more unresponsive on social networks. But the Zipcar situation is notable because the impact of its inefficacy is so clear and apparent. Customers are censuring the brand on social networks. Major media outlets are attacking the business’ customer service model. In all, a company known for being cool, hip and modern is building a reputation as an organization with bad traditional customer service, to a point in which customers cannot rely or want to try it. 5. Have you used Zipcar? If you did, what is your opinion of it as a consumer? If you haven’t, would you try it?
Zipcar has become a must have for any individual or couple that is living in a crowded city such as New York. I am a current member and user of Zipcar. I used to own a vehicle when I was living up in Inwood in the Bronx, a couple of years back, and parking was acceptable. Once I moved to the Upper East Side, parking was worst and I decided to commute at the time by train to work. I got rid of the car and maybe a couple of weeks later someone told me about the Zipcar concept and I thought it was rather “cool” (word of mouth marketing). I started to investigate more about the company and what it does, finally deciding to go ahead and become a member. When I had a car, my girlfriend and I would always go to a big store such as Stop and Shop or Path Mark to do our grocery shopping, and then when I returned the leased car we started to buy in small stores around where we live (Key Foods, Fairway, etc.). We noticed that the food was costing us more than what we were used to, so Zipcar came into the picture. On a monthly basis, now I take out a car from one of the various locations/parking lots around our apartment and go for grocery shopping or any special type of shopping. At the end we found out that by doing this it was much cheaper and we can buy big quantities of items at one time.
My opinion of Zipcar is that of convenience, for me it serves the purpose and that’s’ it. If you need a car for a few hours to get things done yourself and not depend on anybody, than this business concept of car sharing is perfect. I would also say that they have a lot of work to do regarding car interior maintenance and fees. What really got me to become a member was the very low rates that they offered, but once I reserved the first car it came to me that the rates were a couple of dollars higher than originally thought. For me that was the first deception but it was still lower than renting a car for a couple of hours, so I figured it would still be beneficial for what I need it for. Another deception was that they charged my $50.00 dollars because of a late return item, which I thought the amount was outrageous, since reserving and using the car was a lot less. The reason for late return was that I was in heavy/unusual traffic and it also took time for me to put gas on the vehicle. At the end, they charged the late fee but credited back once I made a complaint over the phone and sent them an email explaining what really happened. Within this regard they really treated me well. In my couple of months of experience using them, I think they have an acceptable customer service, but I still see that they need to work on it. They also need to ensure the quality of their vehicles, once I had a car that smelled like a guy smoked a cigar the whole day; it was an overwhelming smell, at the end I had to change the reservation and go pick it up to another parking lot. Zipcar has to find a way to have a better maintenance system of their automobiles and keep them in a good condition both in the interior and exterior. 6. What do you think Sal should have done? Leave his interview or stay? What about Anita? Are you concerned that Anita might not get her car? Can a sizeable late fee discourage Sal’s behavior in the future?
With having somewhat of an experience using Zipcar, I can say that it is very easy to get discouraged with their services. Not finding the car at the time you reserved, finding the car in bad condition both in the exterior and interior, and having to pump gas because the last person who used it left it empty, all of this can really make you think twice of staying as a member or even becoming one.
In my view, Sal should have really mentioned to his interviewers what was happening with his Zipcar reservation, I am sure that they would have understood. But I also recognize that he was in a bad situation to discuss this with them. If this happened to me, I would have stayed and not say anything. Just for leaving to speak with Zipcar, I could have lost the job opportunity. I would have stayed and when the interview was finally finished, I would have called Zipcar and explained everything before they added any late fees. At the end, Zipcar would have perfectly understood.
In Anita’s case, I would have called Zipcar and made a big deal about her situation. Maybe they would have reserved her another/better car than the one she reserved, or maybe give her some free hours using the car. In this case, the only thing that Zipcar can do is to give her extra hours to use the car, and send her to the nearest parking lot to get her car, or if this other parking lot is too far than she would ask for another type of car regardless of type and cost for the same fee.
In both cases, if Zipcar does not act properly and think about the customer, they will indeed loss two members. If Sal, had been charged a late fee (usually $50 for the first hour past, $25 every subsequent hour after), than he would have been definitely terminating his membership. In turn, Sal would be looking for another means for transportation. Also, if Anita would not get any type of compensation for the time she wasted procuring to call Zipcar, she would have indeed terminated her membership.