...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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...Zipcar Case & IT Doesn’t Matter Zipcar Case 1. Analyze the business model of Zipcar using Porter’s five forces model. a. Threat of new entrants: The threat of new entrants is something to be concerned about. The barriers to entry are no different now than when Zipcar first launched with the exception that technology has evolved. The major advantage Zipcar has is it is the first entrant and established in its current markets, but this is not the case in other markets/cities where Zipcar does not currently have a presence. The other advantage Zipcar has is the patent on its wireless technology, but a new competitor might be able to develop technology that could function just as well. In order to keep the threat of new entrants minimal, Zipcar would have expand into other cities and take advantage of its existing infrastructure. b. Supplier power: The biggest equipment costs I can guess for Zipcar would be car purchasing and maintenance and infrastructure cost/maintenance. For cars, there are a few big suppliers that also provide service. The models offered by the various companies that could fill the needs of Zipcar are largely similar. There are a few differences but all of the major car suppliers offer models that have similar fuel effiency, power plant (combustion engine, full electric, or hybrid), etc. While Zipcar might be able to dictate price, the company could shop around for the best price with small cost for switching. c. Threat of substitution:...
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...model depends on the type of products or service a company offers and to whom. In a given case, Chase and Danielson recognized possibilities in car-sharing business idea and ventured a deal. Zipcar emerged as a start-up company which offers car sharing service operating on a B2C basis. Zipcar offers on-demand vehicles and delivers mobile and timesaving service focusing on urban areas and its residents. Consequently, Zipcar business model in terms of its target market is segmented mostly according to geographic and psychographic factors (urban area people). As it follows, Zipcar mission statement flows out of its business model and aims to enable simple and responsible urban living. Business model most of the time integrates or is integrated within business strategy. Since Zipcar offers transportation service its business model/strategy in the first place is the car-sharing concept. Secondly, according to Ansoff’s Matrix framework, Zipcar business strategy is market development as long as the company offered existing product to a new geographic market. Chase and Danielson recognized the implicit need in a new market for already existing product/service on time and went for it. Zipcar was designed to offer car-sharing idea which evoked and brought that same hidden need onto the surface developing company’s potential market. Business model is closely tied to business’ objectives. Zipcar Company’s key objective for business growth and development appears to be a future where car-sharing...
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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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...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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...ZIPCAR CASE ANALYSIS The pain that Zipcar is trying to address is the inconvenience and costly car options to the web-connected people. Based on our analysis of the case we think Zipcar’s business is easily imitable and to prevent an entry of new competition, Zipcar must achieve economies of scale at the earliest and strategize to increase their customer base and lower their customer attrition going forward. In the long run, the success of the Zipcar would depend on how many customers they have and the ability of Zipcar to leverage on their economies of scale. We would also recommend on how they can more wisely choose their type of cars, promote their brand and most importantly how they can raise funds at the upcoming Springboard conference. Though the primary emphasis of Zipcar is on convenience and cost savings, the Zipcar concept is planned to be marketed as environmentally friendly. We feel this is an additional pain that Zipcar is trying to address that poses risks because, firstly, there are other two similar companies in US (Portland-based Car Sharing Inc. and Seattle- based Flexcar) that are already more focused towards the environment friendliness. Secondly, if Zipcar really wants to market their product as environmentally-friendly, then they probably should choose their launch car from a list of most environment friendly cars of 2000 such as Toyota Prius, Honda Insight or...
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...Kathmandu University School of Management | Entrepreneurship and Innovation | Zipcar: Redefining the business model | | | 3/29/2015 | Submitted to, Prof. Rupesh Krishna Shrestha | Submitted by, (Group 6) Niraj Ghimire (14313) Amit Pathak (14325) Subigya Regmi (14327) Prajwal Sagar Shrestha (14332) Synopsis: Zipcar is a start-up organized around the idea of "sharing" car usage via a membership organization. This case describes several variations of the Zipcar business model along with their financial plan. These variations include a very early version and a version developed just prior to the launch of the business, as well as data from the first few months of operations. This case is all about the underlying the business model for the venture and to discover how these assumptions are holding up as the business is actually rolled out. Case Facts: * The company was incorporated in January 2000 and raised an amount of $50000 from an angel investor. * Although an MBA from MIT with a good professional background, Robin Chase had minimal experiences regarding start-ups. Similarly, Antje Danielson, despite having held several high position jobs was relatively inexperienced when it came to entrepreneurial venture. * Car sharing was best suited to urban areas where the population density is high. * College-educated individuals were the most receptive to the proposition of car sharing. * Penetration for the car sharing business module was small (0.01%) in...
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...Case Study: Zipcar Bryan Gibson IT496 June 24, 2013 Contents Case Description 3 Firm History & Products 3 What Do They Do Well? 4 Are Their Things They Do Poorly? 5 Porter’s Five Forces 6 POTENTIAL THREAT OF NEW ENTRANTS 6 BARGAINING POWER OF SUPPLIERS 6 BARGAINING POWER OF BUYERS 6 THREAT OF SUBSTITUES 6 INDUSTRY COMPETITORS 7 Sustainable Competitive Advantage 7 Case Questions 8 Discuss the synergy between the business strategy of Zipcar and information technology. 8 As the CEO of Zipcar, what would you do to sustain a competitive advantage? 8 Is Zipcar a Success or Failure? 9 Will Zipcar Survive? 9 Should Zipcar Alter Their Strategy? 10 References 11 Case Description Zipcar is a company that was co-founded by Antje Danielson and Robin Chase in January of 2000, and was based on a car-sharing system originally utilized in Germany and Switzerland. The concept was to allow car rentals by the hour, with arranged pick-up and drop-off times located in neighborhoods allowing customers to simply walk to the vehicle without the need to wait in line. Danielson and Chase were concerned about the environment and this was their solution to vehicle overcrowding. Additionally, they feel their service helps to alleviate the headaches associated with owning a car, and gives people the option of having a second car or a bigger car, if it suits their needs, without having to buy. Zipcar is backed by a proprietary IT platform which allowed...
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...Zipcar is a car sharing program based on Cambridge Massachusetts. It imposes an annual fee for its members depending upon the level of service and a fee per hour. These fees cover insurance and initial driving license checking fee. Consumers do not have to worry about insurance, down payment for car and monthly fee. Zipcar targets cities where it is difficult to find parking and people depend upon local transportation system. One of the main attractions of Zip car is customers can own car when they need without having to deal with monthly payment, insurance and parking problems. A brief overview of the key facts and issues related to management consumer behavior: Zipcar’s primary market is among urban dwelling people. People living in cities such as Boston primarily depend upon public transportation. Running errands and even work can be either within walking distance or within a reach of public transportation. Parking can be expensive and many time unavailable. Since these people use car occasionally, sharing car instead of owning one can be less expensive. Zipcar also focus its services to students who need car occasionally but do not want to own one. After paying certain fee, its members can have car with whenever they want for a small fee. Zipcar has locations around cities where it has fleet of cars. Its members can choose different kinds of cars. Members can pick up cars and return car on the designated spot using Zipcard. The same car will be used by other members too...
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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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...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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...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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...Myra Hart, Senior Lecturer 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...
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...Zipcar Case 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...
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...9-605-054 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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