Enterprise Car Rental - Essay Example

 Marketing is a communication methodology regarding a product or service’s value to customers for the selling purpose of that product or service. It is the manner in which interaction take place between companies and consumers in order to create a relationship that is mutually beneficial. The case study focuses on Enterprise Car Rental company. It is an international brand that was founded in 1957. It is in over 6,000 locations across the world. For instance, it has taken deep roots in countries such as the United States, Canada, United Kingdom, France, Germany, Italy, Portugal, Ireland and Spain. The company built the largest car rental brand in North America. The brand is widely known for low rates that are exceptionally as well as outstanding customer service. The brand has effective product and service offering methodologies in relation to marketing. Regarding the company’s management it has successfully showed tremendous leadership that has enhanced its operations worldwide. Motivation among employees in the company has been achieved thus promoting entrepreneurial spirit among them thus enhancing and encouraging high productivity. Enterprise Car Rental has established a consumer oriented strategy in relation to marketing that is of great importance to success. The company though has been opposed by stiff competitions from its main competitors. Enterprise not only sells services, it also brings an experience that is real in the market industry. A market Development Strategy has been followed by the company rigorously since it has put great effort to an existing product(car-rentals) regarding the new market. Earning of profits that are high in the market that is untapped has been enhanced by the effective strategy. A rapid growth has been depicted in the Enterprise recently. The opportunities in relation to particular segments of market are now realized by competitors. Therefore, they are putting great effort to enormously build up their strengths in those realized branches. New entrants have posed a significant competition in the same segment of market. Therefore, Enterprise is gradually becoming saturated in its Market Development Strategy thus becoming obsolete. There will be no development room in the market soon because of the stiff competition that is slowly lowering demand from its consumers. For the Enterprise to regain its stability in the market context, they should switch over to a more advanced Market Penetration strategy to attempt. Thus, this will help them once again gain market share across the world but not only in its segments of veteran homes. Moreover, it will have to recognize that different segments have characteristics which are different in order to develop its business strategy accordingly. Since customers are looking for services that are efficient and reliable, Enterprise should consider their needs and address their taste and preferences aspects. Consumers are interested in the cars thus always eager to have the best services when they need them conveniently. Often, clients demand luxury and reliable automobiles. Therefore, Enterprise should be ready to meet their clients’ demands without any failure. The Enterprise has Home-City Rentals who are also their clients. These are individuals who are in need of rental cars as replacements when their cars get wrecked or need repair on their parts. The Enterprise Car Rental has a service marketing that is made up of four distinct characteristics namely; inseparability, variability, intangibility and perish-ability. Inseparability refers to services’ characteristics which makes them inseparable from their production means and from the experiences of the customers. Inseparability necessitates that a service offered to a customer greatly interacts with its producer in order to acquire its benefits. On the other hand perish-ability is a term used in marketing to describe the manner at which the capacity of services cannot be kept or stored for the future sales. In relation to services marketing, its a key concept. Variability in marketing is defined as the quality changes of the same service that is provided by vendors who are different. The nature of services usually changes its variability. The person, when, and the delivery method of the service defines its variability. In marketing, intangibility is used to give a description to the inability of assessing the value gained from an activity’s engagement though the use of an evidence that is tangible. In this case, services are described where a tangible product is absent which the consumer can purchase. It cannot be seen, touched or tasted. In relation to Enterprise Car Rental services, the aspect of intangibility exists. Therefore, the Enterprise must put a lot of efforts to overcome intangibility. The characteristic of a service has though been combated by through the use of brick-and-mortar sites. The sites Enterprise rents’ style and size gives them features that are tangible. The enterprise Car Rental agencies should be given some tangibility by the employees’ dressing,demeanor and appearance. The friendliness between employees and customers should be more tangible in relation to customer service survey. Its delivery feature should be unique in a sense that services should be physically presented in relation to their adds that are long-running.The Enterprise’ inseparability form is an essential key towards making it successful. The services cannot be separated from the Enterprise. This is because the company creates the services that are to be offered to customers (Magin, 2006).Regarding to the perish-ability aspect of the Enterprise, there are many opportunities that have been lost that cannot be regained. This is mainly in the airport-hotel car renters or in the Enterprise that goes every minute, hour and day without any vehicle rentals. The Enterprise should still has the opportunity because there are more minutes, hours and days during which it can conduct additional rentals sale. The Enterprise should also enhance variability of services. Is should creates a variety of services towards the customers’ satisfaction. For instance, internet services should be effectively provided through the use of websites. There should also be low rates provision towards the service payments by the customers. The Enterprise should focus on the customers satisfaction’s key drivers and create a culture with an orientation of the service. There is a major challenge in most companies that deal with auto-rental cars regarding to variability. Therefore the Enterprise should focus on the key factors that results to customers’ satisfaction. They should consider the costs and the fees of the services. They should considerably lower them inorder to attract many customers. They should also analyze the customers’ pick-up process, reservation process, return process and shuttle bus service. They should build improvements in relation to the experiences of the customers of rental-car. Higher customer satisfaction levels with relative low costs and fees should be established in order to achieve the Enterprise’s set goals. Marketing mix The product and service offering refers to the products and services on offer from a particular company or firm. It is the amalgamation of all goods and services on offer to all company clients. Here, a few factors are key in defining product and service offering. These are: Firstly, it is important to consider if to standardize the product or service on offer or to adapt to the ever changing and dynamic market trends. Considering that client tastes are changing is, additionally, important. In this particular instance, Enterprise Car Rental was established in 1957. To date, numerous car brands have been developed over this whole period (Sandhusen, 2013). This has brought along a similar impact on individual tastes for cars. This means that customers would probably be interested in renting more modern car models than older ones. The company should think or adapting if: (1) The customers are of a lower income bracket, are of a different language and culture etc (2) Local laws demand compliance. (3) There's pressure for local content by the government, which in this case would be in the form of local employee percentage ceilings, or local ownership of part of the company. For Enterprise Car Rental, the above points have been taken into consideration, in order to build and successfully run a brand so big and internationally recognized. It is therefore important to put these into consideration to maintain a lock on the current customer base. Secondly, diversification is an aspect of great importance. Is the company better placed to introduce new car models into its range? Market segmentation is vital here, as one should carefully consider what impact this could have, considering that it is an international brand. Will the newly introduced models fit the target market with regard to the income of the targeted customers? Business rivals could also help determine this (Eisen, Keene & Bloomberg, 2013). Thirdly, in the introduction of new products and services, should one introduce them in phases at different parts of the world or introduce them worldwide at the same time? For Enterprise Car Rental, the brand was first established in North America before being subsequently rolled out in European countries like Germany, France, Italy and beyond up to the over 6000 plants it currently has. Fourthly, distribution logistics could be the main determinant of profit and quality service provision worldwide. They should therefore be considered in new ventures the company may wish to undertake. A few factors are important: Distribution agreements: one should consider the important aspects of trading, licensing and agency issues Motivation and communication issues with the distributor are important. There should be sufficient communication with distributors, since they are ideally, customers, too. Information on availability of stock, invoicing and all necessary paperwork should be readily accessible through available channels. Enterprise Car Rental ensures direct communication through email to its various agents worldwide. In addition, there's direct communication across board, to different levels of management. Through incentives, promotions, visits, training and regular communication, the employees remain motivated. Retail and wholesale issues: may not always be applicable to car rental businesses but could apply if there are cars to be imported for the business. Fifth, it is important to consider how new technology could impact business. Vehicle tracking is one of the most important technology to consider here. Enterprise has a vehicle tracking system that helps determine the specific location of vehicles, with an astounding accuracy rate. In retrospect, the above points describe one factor in the marketing mix - product. The marketing mix is a collection of the factors one should consider when analyzing a business. There are four main factors to consider in this respect, the other three being: price, place and promotion. Price When determining the price, one should consider the income levels of the target market. The public image of the target market is also key. Enterprise has taken this into consideration, since it has concentrated on North America and Europe. Here, the per capita income is higher than other parts of the world. Therefore, there is a greater number of people who can afford renting a car at the specified price, all other factors kept constant. For greater customer experience, and to grow the brand even more widely, the company should think of ways to attract customers from lower income brackets from, say, Africa and parts of Asia. Additionally, prices should idealy be varied. It is important to consider if a rise in price will result in overall profitability or a loss in customers and a subsequent drop in profits. Should the company seek to venture into new markets like Africa, what should the introductory price be, if any? Learning to fit a specific price for a specific target market remains the biggest hurdle to any business. Enterprise should constantly and regularly review its price structure, and adjust it accordingly. Promotion Promotion involves being able to speak confidently about a product or service, then being able to sell it to a client. Companies should continue to develop new ways of marketing and selling their products and services to clients. As old conventional methods of advertising continue to be phased out, companies should find new ways of adapting. Even very small changes such as changing the headline of an advertisement could spell tremendous changes to the company. Enterprise should therefore constantly develop new ways of promotion, in order to expand or keep the existing market. Throughout the years, Enterprise Car Rental has continued to come up with creative and informative advertisements. These should, however, be improved upon a more creatively done, as the times continue to change. Place Place refers to the location of a business. In this case, the over 6000 locations in the United States, Canada, United Kingdom, Ireland, Germany, France, Spain, Portugal and Italy. The location is a very important aspect of any business. In some quarters, it has been quoted that "location is everything." The income bracket of the inhabitants of a particular place should be taken into account before establishing a business. In this particular case, where impact could changing a location have. It is also important to have a thorough understanding of the market, so as to determine what location would capture the most of the targeted market. The question answered here is, where else could the company offer its services? For a company as expansive as Enterprise Car Rental, getting the place right helps to determine new frontiers for the business. For instance, where will the offices be located? This helps determine how easily the customer will be accessing information on offers, prices, new service packages etc; as well as the demand for its services and the need for establishing a new location. In addition to the service or product offering in relation to product, price, place and promotion elements, there is also marketing mix that consist the process, people and physical evidence. Physical evidence refers to the way a product or service of a company appears when viewed from outside. When conducting marketing, services are greatly intangible. There is a reliance of physical cues by customers in order to help them perform an evaluation of the product before buying it. Therefore, Enterprise Car Rental marketers should develop physical evidence in order to replace the customers’ physical cues in services. There should be an implementation and designing of evidence that is tangible by the marketers. This is because physical evidence is pivotal material part of any given service. The environment with ambient conditions should be provided by the Enterprise. For instance, meals in car-rental hotels and restaurants should be clean and healthy for clients. Safety should also be considered during journeys in air-crafts for effective traveling. Moreover, temperature, smell, color, music,noise and sound should be provided according to customers’ wish. There should be also a layout that is spatial in that furniture will be set up or machinery will be placed. Service liability should also be developed in order to cater for any harm that may be caused to customers in relation to car-rental. Marketing services that are intangible in the Enterprise should be supported in order to make customers view them as physical. The employees’ code of dressing should be descent and should act well towards their customers since this is an aspect of physical evidence. Moreover, the professionalism of the Enterprise’s staff in all its branches should form an effective way of interacting with their customers. People is also a significant aspect that should be considered in the Enterprise. It is a part that is extremely important towards that company’s developments and goal achievement. The Enterprise should only allow the right people to support its operations towards products or services provision. The customer service personnel should be excellent in order to provide support in relation to the set expectations. For instance, operation hours and average response time should be highly maintained since its the key factor towards customers’ satisfaction. Skills concerning customer services should be taught so as to increase employees’ abilities to handle customers pleasantly. Therefore, the processes of hiring, retaining, building teamwork and training personnel should be put in place. This will increase the service offering value through a staff that is knowledgeable. The Enterprise Car Rental’s employees need to be trained on how to guide clients regarding maintenance and usage. Process in marketing mix aspect is also another crucial element. The Enterprise Car Rental, therefore, should develop and put in place solid policies and procedures that pertains the services offering. Therefore, it will be able to provide an effective strategy of marketing towards fostering its success. Since customers need to understand more than just the Enterprise’s service/product, it will be important if they also focus on shaping the form that it will take. Enterprise Car Rental should therefore consider these marketing mixes in order to effectively compete with his main competitors in the market. By doing this, they will confidently outdo other companies which offer the same segment of services across the world. The Marketing Development strategy will be effectively achieved thus yielding good results to the enterprise. A service market offering refers to the collection of all services and goods on offer by a particular company to the public. There are three aspects to this end when considering the product or service. These are: Mix If a company offers more than one product or service, it is referred to as a product mix. Beyond selling cars, for example, car dealerships also offer fixing and maintenance services. In the product mix, there is a range of slightly different services on offer, along the same line of business. Depth Depth refers to the number of products or services on offer, in a single product line. Depth also refers what market segment or group of customers the product or service satisfies. In this case, what section of the targeted consumer base feels satisfied by the service? The bigger the depth, the easier it is to have a lock on the market segment. Additionally, it becomes increasingly more difficult for new entrants and competitors to venture into the market. Width Width simply refers to the number of product/service lines on offer. If a business deals in selling hot chocolate, the demand for the same fluctuates throughout the year. In winter, the business is expected to be brisk as the demand is very high. In summer, however, the demand for hot chocolate dips significantly, while that of ice cream and chilly drinks rises. The same goes for car-rentals. In winter, the demand for rented cars similarly dips, but rises in summer. This is a very important factor to consider, as it affects business. In this particular instance, Enterprise Car Rental should think of introducing new services into the market. A good example is courier services, whose services could be offered as an additional package. Packaging is also a key factor to take into account. How will the cars be painted? How will the chauffeurs be dressed? What impact could this have on the profitability of the business? Providing answers to such minute details could help the business tackle new markets more easily. Having considered the product, one should consider the price. Enterprise should find out what the average price for renting a car in a particular place is. For existing markets, this should be done with a view to adjust the price, either upwards or downwards, depending on the prevailing circumstances. For new markets, finding out the local average rates helps determine the introductory price. The place or location is also one of the most vital components of the marketing mix. Location determines many crucial things to a business. These include: the language used for transacting business, type of employees, office costs among a host of other operational considerations. It should therefore be treated with a lot of seriousness. Additionally, promotion is should be given priority. As indicated earlier, Enterprise has produced capturing and creative advertisements over the years. However, with the advent of new-age technology such as social media, Enterprise is best placed to adopt these new avenues of marketing, in order for it to reach out to a greater market, and connect with customers on a more personal level (Sheehan, 2011). Moreover, people are at the center of many businesses. Excellent customer service guarantees greater customer satisfaction, in addition to ensuring return business. It is therefore important to ensure that the right people are working at the customer service, who offer responses to customer queries among other customer retention strategies. Furthermore, the process of conducting business should be clear and customers should understand clearly the way the rental business runs in addition to what shape the business takes. Lastly, the packaging should be in the form of what color the cars for rent should be in. 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