Zipcar’s Marketing Strategy

Introduction:

Ideally, marketing should serve as a conduit between a host of important elements of the firm and the consumer base. The effectiveness of marketing or any marketing strategy for that matter, can thus, best be described as a function of the extent to which it enlarges its skills and knowledge, in the process of connecting the product and the consumer, while maintaining an optimal level of financial accountability. Talking about marketing strategies, one of the most revered and successful strategies are Zipcar’s marketing strategy. The car sharing giant set out to epitomize various marketing principles and consequently managed to create an enviable client base for itself in a span of a few years.

Answer 1

Talking about benefit oriented positioning; Zipcar seems to have done a fairly good job in this area. In its positioning strategy one of the most unique features is the fact that the company has been constantly evaluating and changing the parameters or the benefits around which their positioning strategy centers. As per the concepts of positioning given in Chapter 7, a strategy must be able to present explicitly the benefit which the product seems to accrue to the potential buyers. In Zipcar’s case, their impetus of environmentally benign cars helped them earn brownie points with their clientele. Further, as indicated in Chapter 7, a good positioning strategy must be evaluated and changed from time to time, on the basis of the requirements of the niche that an organization is trying to target.  Likewise, Zipcar, moved on to expand its perception of the possible benefits that people might get by renting Zipcar cars. For this, it went ahead to clearly outline the typical ‘car-sharing’ individual. While doing this, they noticed that there were a few reasons as to why somebody would want to share a car or rent one form Zipcar. The strategies based on these pointers set out to achieve a number of objectives, which included the likes of reducing the hassles of owning a car, having the required resources for owning a car, doing away with the responsibility of maintaining a car and making having a car affordable and easy, among many more.

To achieve this end, the company introduced a slew of pro-client services. The company enables people to become a member of the Zipcar car rental network by paying a membership fee of $60 on an annual basis. Plus, people can reserve a car as quick as within minutesor they might reserve a car well in advance.  Coming to the cost, it is hard to get to drive a car of one’s choice for as little as $7.50, especially when it includes insurance, gas and an added bonus in the form of free miles.  Once people are done with the rental car, they can return back the car and leave the cleaning and maintaining to Zipcar. All these services and freebies have substantially reduced the hassles one encounters in owning a car. With Zipcar, in their lives, most people do not feel the need of owning a second or third car.

Answer 2

An important thing to note is that the success of any strategy also depends on the extent to which it fulfills human needs.  Unless a product is marketed in a way that it makes the client feel that there indeed exists a need that this product or service can fulfill, the product will not be able to make the optimal impact on a potential customer. It is for this reason, that marketing strategies use potential human needs as their crux, as explained in Chapter 1. In this context the hierarchy of Maslow’s needs come to great use. Chapter 5 explains the entire concept of the hierarchical nature of human needs, as envisaged by Abraham Maslow in 1943. According to Maslow, the achievements of people are motivated by the urgency of their needs. He went ahead to classify these needs as physiological needs, safety needs, social needs, needs catering to a person’s self esteem and finally self-actualization. The more a product had the capacity to fulfill a particular need, the more suited it is for a person. Likewise, a marketing or a positioning strategy is likely to more effective, if it caters to a similar human need.  Coming back to Zipcar, the company’s beliefs are more or less tangential to the social and safety needs of a person. A rather sensible and objective fact that has guided Zipcar and helped it immensely in narrowing down their niche is their belief that while they cannot create a product that can completely satisfy everyone, they can definitely serve the urban dwellers of densely populated areas, who wish to own a car minus the hassles of ownership. They identified this need as a lifestyle that people couldn’t wait to have. Zipcar started out with a value system that was a reflection of what was on their customer base’s mind, namely environmental consciousness.

Once, they had found a footing for themselves in the market, they shifted focus to revaluating their course. Zipcar went ahead to look into the most compelling factors for renting a car. These factors were then used to model services and strategies. These strategies bore semblance with needs for convenience, affordability, a no-hassle functioning, accessibility and fuel efficiency among many more. For starters, people could easily hire a Zipcar, by paying an annual membership fee, which was as low as $60. The strive to make the consumer’s experience a great one, was reflected in the accessibility with which people could reserve a car via their online portal, mobiles or an app. Additionally, free insurance and gas along with fuel efficiency, in Zipcars, was like the cherry on the cake. Another unique feature about Zipcar’s approach to marketing was the personal touch to the services dealt out to customers, which made them feel that they were borrowing a car from a friend rather than a rental car agency. Such proximity between the company and the clientele is a very healthy development. Today, these clients are fondly referred to as Zipsters.  Such references of colloquialism in a client- organization relationship enable organization to break the ice and create a long lasting brand impact. A wonderful move towards this end was giving each of the ‘pods’, as people like to refer to these cars, a name and a personality. Further, as these profiles and names were given by the Zipsters themselves, it helped to compound the cohesiveness between the two parties.

The success of any marketing campaign has a lot to do with its inclusiveness of the client. Client participation, be it in an active manner or passive manner, can have a substantial bearing on the results. Understanding this, Zipcar went ahead with customized promotional activities and events that enabled prospective clients to interact on a one-on-one basis with the company. Be it swinging sledgehammers at SUVs in San Francisco or guessing the number of frozen meatballs in a MINI, as was done during a promotional activity in Harvard’s campus.

Despite such success, it is definitely not easy to target such a large audience via single prong strategy. Especially, when one considers the fact that the company has a goal of enabling every Zipster to not have to walk for more than ten minutes, before they encounter a Zipcar. Realizing this, the marketing team organizes various events and advertises via local ads, by dividing areas on the basis of zip codes and blocks. This ensures maximum outreach.

Answer 3

Positioning refers to the plan that marketers have charted out in order to promote their product in the niche that seek to target. It is reflective of the values and requirements that guide them.  As explained in Chapter 7, positioning may be differentiated on the basis of many factors. Two of such factors are benefit orientation and beliefs and values.  Talking about Zipcar’s positioning strategy; though Zipcar started out with a value based strategy it soon shifted to a benefit oriented strategy in order to expand its customer base. Zipcar started out with an objective to create a urban lifestyle that, though could not impress everyone, but was definitely the thing that most urban dwellers, residing in highly populated areas such as New York, London or Boston, were wanting. While starting out, Zipcar adopted a value based positioning strategy that helped it differentiate itself from its competitors. This concept was that environmental consciousness. This strategy helped it create a solid footing for itself. Also, Zipcar had the advantage of being the few companies who promoted the idea of ‘environmental friendly’ through the rental cars market. This gave it an early entry advantage. Moving on, the company changed tracks from a value based strategy to a benefit based strategy, with which it sought to sustain its growth. Such dynamism is required if a firm has to stay in the market while still being useful to the client.

When the firm shifted to a benefit oriented strategy, it first underscored the most compelling reasons for renting a car. It then tackled each of these reasons by incorporating a solution for every problem in their policies and services. Further in their bid, to cater to more and more needs, the company went in for some hard core sales pitching by organizing various promotional events that involved the participation of prospective clients. Moreover, Zipcar’s model has been immensely successful that it is being used global giants like Google and even by Chicago city agencies, who are looking for a more sustainable means of transportation for conducting their business.

The benefits accruing from a value based strategy as in the case of Zipcar, gave it a headway in the rental car market, giving it some leeway, which otherwise while, their benefit oriented strategy enabled them to survive without having to fall back on their past performance. A benefit oriented strategy considers the fulfillment of human needs as crucial. On the other hand, a positioning strategy based on values might be out of sync with what clients are actually looking for. Further, Zipcar has managed to create a level of brand loyalty that is similar to that of other iconic brands like Apple Inc. and Harley Davidson.

Based on my evaluation, positioning on the basis of benefits turns out to be stronger and more sustainable than a strategy revolving around the pivot of the firm’s values. While using the latter may be ideal for creating a niche or carving a strong foundation for a company, or for that matter, even changing the strategy or focus of a company. However, in order to sustain the customer base that they have assembled, there needs to be something for the customers to look forward to.

Bibliography:

 

1)      Richard Rosenbaumlliott and Larry Percy, Strategic Advertising Management, Oxford University Press, 2012, Print

2)      Moorman, Christina, and Rust, Roland, “ The Role of Marketing” Journal of Marketing, 63 (1999) : (2-3)

<http://www.rhsmith.umd.edu/files/Documents/Faculty/TheRoleOfMarketing.pdf>