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HISTORY
Robin Chase and Antje Danielson establish Zipcar in Cambridge, Massachusetts
2000 2003 2007 2010 2011 Today
Zipcar hired Scott Griffith as CEO
Zipcar acquired one of its main competitors, Flexcar
Zipcar purchased Streetcar Limited (UK), opening the door to European region
Joined the “Establishment” and become a public company
KEY EXECUTIVEScott Griffith: Chairman of the Board and CEO• Griffith joined Zipcar in 2003• focus on “getting thing right” • turned his business acumen to Boston,
Washington DC, and New York city• His leadership is credited with defining a new
category of transportation.
Steve Case: Board of Directors, Chair of Nominating and Governance Committee• One of the nation’s greatest entrepreneurs• Case’s accomplishments and entrepreneurial style are an obvious fit for Zipcar
Work experience: senior-level positions at Boeing, Information America, and The Parthenon Group
Work experience: AOL - world largest internet company
KEY EXECUTIVEEd Goldfinger- Chief Financial Officer• technical savvy, financial education, and leadership skills • Zipcar’s decision to replace former CFO Shuan Starbuck
with Goldfinger as a move to focus on strategic growth initiatives.
Work experience: CPA in Connecticut, CFO of Spotfire, CFO at KPMG, CFO at PepsiCo, CEO at Empirix, and CFO at Sapient
Mark Norman- President and Chief Operating Officer• joined Zipcar in 2007• Ability to streamline the complex business model and operations while maintaining a focus on member experience.
Work experience: CEO of Flexcar and Chairman, President and CEO of DaimlerChrysler-Canada
SOCIO-CULTURAL
Change in way of life•The cost and availability of parking space: 207 open-air lots were lost from 1999 to 2008
High and difficult to anticipate fluctuations in
the cost of parking
Lifestyle
Partners with lifestyle brands : innovative
marketing
Car sharing has grown in popularity
Competitors
63% of surveyed college applicants agreed that, “a
college’s commitment to the environment could affect their
decision to attend”
• Zipcar substantial decreases in CO2 emissions• University supplies marketing, parking, and financial guarantees
• Car companies have successfully embedded into the psyche of American consumers “freedom”
• Car companies producing smaller, lighter, safer and better gas mileage
Zipcar brand is about more than cars, it is about fun and freedom
and improving urban life
It is capital and resource intensive and requires constant modification and improvement
to meet customer demand.
Zipcar keeps its organizational structure fairly flat
TECHNOLOGICAL
Technological advancement
Radio frequency identification
FastFleet
Social media Marketing: Facebook, Twitter
ENVIRONMENTNatural disasters in
Japan
Customers are going green
Higher cost : supply shortages, manufacturing delays
Zipcar distinguishes itself as an original, green idea and
sustainability
Many businesses leverage their alignment with sustainable
companies like Zipcar to appeal to their own customers
ECONOMICSRecession• transit operators being forced to cut some routes• average price of a new car in the US approaching $30,000• any economic distress impacting suppliers of car components to manufactures• Oil prices have more than doubled since its bottom in March 2009
seek alternative forms of
transportation
Many businesses changing status quo
the same costs that plague consumers
plague Zipcar
POLITICAL
Political volatility in the US in regard to production,
dependence on foreign oil, and natural resources
usage
Renter age restrictions mandated by insurance
companiesOpportunities for Zipcar
High cost for Zipcar
STRENGTHS Customer-centric vision (Level of responsiveness, Z3D Knowledge
Center)Technologies that focus on customer satisfaction (RFID) Innovative collaborations e.g. StarbuckGreater Flexibility First moverWord-of-Mouth marketingGain largest market share in North AmericaROE increase from 0.99 in 2009 to 2.66 in 2010
WEAKNESSES Low ability to pay debt Inability of achieving EOSDifficult to compete in European Low ability to generate sale from asset Low ability to generate profit of Zipcar Low ability to pay interest
OPPORTUNITIESCar ownership decrease by 3.5 % because of increasing in gasoline
priceCollege students have been prevented by car rental agencies.College’s commitment to environment.Green thinking trend Social mediaGlobal car sharing
THREATSDecline in economic and business prospects of car manufactures.Natural disasters in Japan.Teenager drivers have a crash rate 4 times higher than older
drivers.Retail companies offer car sharing.
FIVE FORCES
• High fixed cost• Lack of differentiation• Economies of scale exist
for all potential entrants• Distribution is easy
• Highly concentrated industry (74% of market share for Zipcar)
• High exit barriers• Various number of
competitors• High industry growth
Threat of new entrants
Competitive Rivalry
• Low switching costs• High availability of
substitutes such as public transportation, car ownership, taxis , etc.
Threat of substitutes
FIVE FORCES
• Numerous parking facilities• Limited contact with
insurance company• Third-party support services
such as data storage and payment processing, which could cause holdups
• Low switching costs• High availability of
substitutes
Bargaining power of suppliers
Bargaining power of buyers
UNATTRACTIVE!
FIRST MOVER CHALLENGES
Challenges
Lack of parking facilities • Keeping affordable and convenient parking for its vehicles
• Utilize both publicity and privately owned real estate
Investment • Sell solution instead of product to fit the lifestyle of Zipster
FIRST MOVER CHALLENGES
How did Zipcar handle the tasks and uncertainties?
The method to introduce and promote the existing services/ products to the market by focusing on the need of the CRM at the present as well as technology
Marketing Street teams to market block by block
Technology innovation
TECHNOLOGIESRadio frequency identification to lock and unlock the cars to
monitor such information as miles driven, battery voltage, and fuel level
24/7 customer service (Zipcard)
RecommendationsQR CODE Free sticker to promote
MARKET SHARE
RecommendationsGeographic expansion e.g. in AsiaCreate alliances
72.2% of market share as measure in members
74% of market share in North America
ADVERTISING
Word-of-mouth marketing
Advertising by using posting ads to mass transit stations
RecommendationsUse Public relationsCSR Activities
Social medias
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