Marketing Principles of Enterprise Rent-A-Car - Assignment Example

Marketing Principles Table of Contents Introduction 3 Discussion 3 P1 3 P2 6 P3 6 P4 9 P5 10 P6 11 P7 11 P8 12 P9 13 Conclusion 13 References 15 Appendix 16 Introduction Enterprise Rent-A-Car is basically a private car rental business and more than 850,000 vehicles are being operated. The main aim and goal of this company is quite different than that of other businesses. The main goal of Enterprise Rent-A-Car is customer satisfaction. In the year 1957, Enterprise Rent-A-Car was founded by Jack Taylor. Enterprise Rent-A-Car is basically a service business that helps customers to provide valued service. Most probably, Enterprise Rent-A-Car is leading rental Car Company in the world. The main activity of the company is to provide excellent service like providing a place to sleep for busy traveler and providing sufficient refreshment. Customers are more than satisfied with the service they are been provided from time and time again. Enterprise Rent-A-Car is always committed to exceed the customer satisfaction. Enterprise Rent-A-Car management team has developed an effective strategy that enables to find out the solution that could help to keep customers happy. The questionnaire has been developed to ask questions to the customers such as ratings for last Enterprise experience and finally if they would be happy to rent a car from Enterprise again. There are lot of benefits of high customer service that help to grow the business and high profitability. This essay will discuss about the points that are listed in learning outcomes based on the case scenario and other aspects. Discussion P1 Enterprise Rent-A-Car can identify the needs of customers and meet it. The effective strategy to identify the needs of customers is the development of questionnaires. The questionnaire is the best possible way to know the satisfaction level of customer towards company (Appendix). Ten respondents have been selected for this questionnaire round. Therefore, the sample size of this questionnaire round is 10.All the 10 respondents have replied that they are quite happy with the services and facilities that are provided by the organization. In terms of location advantages, 8 out of 10 respondents have replied that they find nearest pick-up and drop point near to their homes and offices quite easily. On the other hand, two respondents have replied that they face difficulties to find the locations as they used to live in sub-urban areas. In terms of promotion, all the respondents have replied that word-of-mouth promotional strategy is the major source of brand awareness as the organization has expertise in effective customer service. Each and every respondent has replied that they get quick response from the customer support executives in case they have any kind of quarry. In terms of suggestion and pricing, each and every respondent has replied that the organization should try to consider the economic pricing strategy as recent economic downturn affected the economic environment and purchasing power of people of UK. Marketing Mix Enterprise Rent-A-Car can use marketing mix i.e. 4ps to satisfy the market needs. The four critical elements which can help to market products or business of a company are product, price, place and promotion. Each element of marketing mix is important for every organization to develop an effective marketing plan. Product The main aim for businesses is to market right product that can help to satisfy the needs of customers. Enterprise Rent-A-Car’s main activity is to rent a car to customers who wants car mainly for official purposes, someone who needs car due to theft or an accident and some customers who may need the car because of special occasion or business trip. Enterprise Rent-A-Car should market right product for customers who want to rent a car depending upon the occasions (Ferrell, Lukas and Schembri, 2012, p.81). Enterprise should maintain the quality of vehicles that are being delivered. Other important aspect of products which may include such as options, services, quality, brand name and features. Place Enterprise should offer right quality of products with right price and at a right place for customers to be rented. Every branch of enterprise should be located within the customer’s work and live. This is due to fact that, every branch of Enterprise is located within 15 miles of 90 percentage of total U.S. population those who work and live. Price Price refers to as the amount of charge on service or product. The pricing strategy for every company should be appropriate to reflect the position of product or services in the market. And eventually this results to cover profit margin and cost per item. The price of Enterprise Rent-A-Car is higher than that of other competitors. Prices are higher due to the superior satisfaction level for customers. Although, price is competitive but is should be in par with other competitors (Kotler, 2008, p.53). If the price and level of customer satisfaction are on same level will help to attract more customer to business. Promotion The major effective marketing strategy that can be used by Enterprise Rent-A-Car is word-of-mouth and superior CRM. The main purpose of promotion strategy is to make people know and understand the product. Promotional efforts to be more effective must contain strong message that should help to reach the target audiences. Enterprise Rent-A-Car promotional activities may involve public relations, advertising and sales promotion. There are many forms of promotion that can be adopted by Enterprise Rent-A-Car which are television, radio advertisement, electronic advertisement such as advertising on company websites, print advertising such printed materials and e-mail (Adcock and Ross, 2001, p.29). Word of mouth is the effective marketing strategy that mainly depends upon the satisfied customers who are spreading to the other customers about the effectiveness of Enterprise Rent-A-Car service and products. P2 Customer satisfaction can enable Enterprise Rent-A-Car to gain market advantage over other competitors. The major element of cost of Enterprise Rent-A-Car is to notify the time and efforts that are required to attain the survey of other customers. The data that are been collected from survey can add real value to the Enterprise Rent-A-Car. The ESQi model initiated by Enterprise Rent-A-Car helped to drive the business and eventually achieve better consistency of services. The cost and benefit of an organization is necessary to carry out business action. The profit of the company can be higher is they solely focus on the customer satisfaction. The important benefits that can be attained due to customer satisfaction are high level of employee satisfaction, create huge public relations, increase the reputation of Enterprise Rent-A-Car and finally create high concentration of quality. P3 Micro and macro factors can affect the marketing decision of Enterprise Rent-A-Car. Macro factors used are SWOT and PESTEL analysis. SWOT analysis STREGTHS WEAKNESS Large range of vehicles. Leader in the market position. Enterprise Rent-A-Car is world’s number one and most important car rental company in Europe and also in America. Healthy financial performance. The diversification in portfolio. Growing market. Reputation of the company. Cost of the repairs and maintenance cost is one of the weaknesses. The operations are capital intensive. Not at all one-way Rentals. OPPPORTUNITIES THREATS Most effective presence is on the airports. Economic crisis. Fascinating trends for renting cars Great barrier mainly to enter in to the market. Serving the green customers Increase in the use of internet for the Rentals. Increase of the fuel prices. Infrastructure. The continuous change of rate of Euro. Intense market competition. Mergers and Acquisitions. The amortizations of cars. PESTEL analysis FACTORS ANALYSIS Political factors Environment regulations. Several government policies. Subsides. Keen competition and high taxes to be paid due to the state Economic factors Diversification Excess amount of capacity Cars are environmentally safe Social factors Differentiation of the customer taste Car culture Redundancies Technological factors The use of E-commerce UK is technologically advance which can help Enterprise Rent-A-Car New innovation of effective customer service The use of new technology which is reservation of online Car Rental. Environmental factors Environment can be unfavourable due to the emission of pollution Environment condition can affect the use of rental cars Integrating supply chain can help to reduce lost Legal factors Safety measures of a Rental car that can be related to legal provisions. Micro factors Porter’s five forces Analysis Threat of new entrants Low due to several legal entry barriers Requirement of huge startup business capital Intense market competition Threat of substitutes High due to the availability sufficient public transport options Bargaining power of buyers High due recent economic downturn Huge availability of potential competitors Bargaining power of suppliers Low due to high availability of suppliers. Industry rivalry High due to increase in market competition and their implementation of unique strategies in business operation. P4 Various segmentation criteria that can be used by Enterprise Rent-A-Car are discussed below. National travellers are only focused by rental car market. But Enterprise Rent-A-Car has introduced a segment of neighbourhood. This segment enables to set up branches for people who instantly require rental cars for replacement of their stolen or wrecked cars. The segmentation is categorized in to four parts which are demographic, geographical, psychographic and behavioural. Demographic segmentation is based on variables such as gender, age, income, etc. demographically age of customers 18- 60 are the primary target of Enterprise Rent-A-Car. Parents of the college students and students are the primary target. Students used to rent car airport which can help them to reach campus in time. Same goes for the parents who takes long voyages from home or visit their respective houses. Every customers between the age 186-60 must have a valid driver license. Gender can be male, female and all races are all applicable to rent a car. Income level of the customers must be middle class and should have worthy credit score. On geographic segmentation point of view, every region and town must have a car rental market. Enterprise Rent-A-Car should geographically establish a franchise in every town and region. On psychographic segmentation point of view, Enterprise Rent-A-Car should have the bases from middle class to upper class level. Behaviourally, customers always want that are economically sound, comfortable and good in quality wise. Therefore cars rented from Enterprise Rent-A-Car should be economically sound and high on quality. P5 Differentiated and undifferentiated marketing strategy can be applied by Enterprise Rent-A-Car for their services or products. Undifferentiated marketing is also known as mass marketing. Enterprise Rent-A-Car should decide to should ignore the differences of other market segments and would rather target the whole market. This market-coverage strategy focuses on the common needs of every customer than focusing on different needs. Enterprise Rent-A-Car should market broadly on undifferentiated marketing. The main common needs of every customer in rental are service satisfaction and comfortable cars. Enterprise Rent-A-Car should focus mainly on the customer satisfaction rather than focusing on different aspects. The level of customer satisfaction and service can make Enterprise Rent-A-Car different from that of other rental car companies. This strategy could enable to appeal large number of customers. Differentiated marketing strategy enables a firm to focus and target several market segments. The main aim of Enterprise Rent-A-Car is customer is effective customer service. Therefore, Enterprise Rent-A-Car should apply differentiated strategy that can help not to get easily differentiated. This differentiated strategy can help to gain competitive edge over other competitors. There are many ways that can differentiate rent a car on service. First way is the loyalty programs. This is great possible way that enables customer to repeat purchase. This helps to build a strong customer base. This strategy can be initiated by Enterprise Rent-A-Car. Another way is warranty. Warranty is the can create brand preference. Enterprise Rent-A-Car cerates brand preference. It can help to reinforce the commitment of company to quality of service. Finally, the speed of delivery of goods or services to the customers must be faster. It can benefit the consumer value towards the company. This differentiated marketing should be implemented by Enterprise Rent-A-Car to increase the customer base and increase quality on services. P6 There are several factors that can affect the buying behaviour of customers. Cultural factors, personal factors and social factors. Cultural factors include culture and social class. Personal factors include lifestyle, taste and occupation. Ignoring cultural factors can affect the long term benefit of a business. Cultural factors can be the changing life style of people, need and taste of people. Example, Starbucks had to face severe experience in China. In the year 2007, Starbucks had to close their store due to the clash of cultural value of Chinese people. Every company needs to focus cultural ethics and lifestyle of people of other countries before opening a store. Every people tend to possess different buying behaviour which enables companies to focus on specific social class customers. The lifestyle of the consumer can be influenced by the occupation, economic background and gender factors. For example, Undergraduates are more likely to wear casual clothes than that of formals. Therefore every company needs to study the demographic of the market to start business. P7 Strategy that Nokia should implement to regain its lost ground in current business environment is by following on Price, product, technology and promotion. These components provide opportunity for Nokia to differentiate its products. The price of the smart phones must meet social needs of every buyer. Nokia used to focus mainly on lower priced products. Prices of the products must be set depending upon the customer needs. Nokia has wide range of products such as Nokia Asha, Nokia Lumia, etc. Nokia phones have some great features which vary depending upon the product prices. Nokia should always focus on its USP which is technologically advanced maps and cameras. The main aim of Nokia would be to make new products which are technologically advanced and try to add new features to smart phones which people likes using such as Nokia Lumia. Due to the recent decline in market share Nokia reduce its promotional campaign. Nokia should use promotion techniques to grab the attention of customers. Nokia lagged behind in technology aspects. Nokia should innovate and come up with new technology that could help to convince customers to buy their products. P8 Nokia has been the market leader in handsets for long number of years which is due to its huge customer base and reach. The introduction of Symbian OS has been the main success story of Nokia which was easy to use. Nokia ruled in lower and middle end of mobile phone market for long number of years. The Symbian 60 series was introduced by Nokia in the Year 2002. From the year 2002, Nokia had good market share. But eventually the introduction of Apple iOS in the year 2007 has overtaken Nokia over market share. One of the reasons behind the decline of Nokia is due to the lack of application and user interface in Symbian OS. Lack of innovation was another factor that made Apple iOS overtake Nokia market share. Apple had developed a focused device strategy which enables them to innovate in the way no one could ever imagine. The range of applications in iOS was huge than that of Nokia’s Symbian OS. The UI of Apple iOS was something unique and Nokia continued to improved Symbian OS but mostly following iOS. Nokia completely lost its market share to Apple. Apple was always trying to innovate and give something new to customers. Another important factor that leads Apple to dominate over Nokia on smart phone market share is by the use of umbrella branding strategy. Apple was the first brand to use this strategy. This branding strategy involves by using iPhone as an umbrella brand and subsequently making new type of models each year. Nokia failed to create a buzz and hype towards the customers. Apple’s unique way of launching new models in September of each year creates a sense of anticipation among the customers. But Nokia could not build same anticipation among the customers. P9 Wal-Mart is one of the largest retailers in the world and second largest public corporation. Wal-Mart used many distribution methods to meet the demand and need of customers. Internet has become the biggest platform for online retailers to serve the customers efficiently. Walmart.com is the online process method initiated by Wal-Mart to offer effective online service to the customer who mainly buys product online. The implementation of online method has helped to generate revenue and meet the needs of customers. Wal-Mart implemented centralization in it distribution process by keeping entire control of its supply chain activities in own hand. Wal-Mart being a power house in the retail industry applies wholesale distribution method by gaining all kind of products directly from the companies. Wall mart sells this product at wholesale price to all kind of B2B and B2C clients. This distribution process helps Wal-Mart to retain its existing clients and acquire new clients. Conclusion The effective focus on customer retention and customer satisfaction has enabled Enterprise Rent-A-Carto continue their growth. Enterprise Rent-A-Car goal is to exceed the customer needs by providing effective service. The target customers of Enterprise are who are satisfied with the service and would rent a car again. The growth strategies focused by Enterprise Rent-A-Car is mainly on diversification, market development and development of products. Most of the customers are prepared to pay little extra money to get better and effective service. This theory helped Enterprise to gain competitive advantage over other competitors. The implementation ESQi tool enabled Enterprise to improve the cleanliness, control the attitude of employees and build effective customer satisfaction. Enterprise Rent-A-Car introduced right environment for their employees to engage and motivate them with the help of various useful communication channels. The commitment and skills of the employees towards Enterprise is solely due the ability to focus mainly on customers. References Ferrell, O., Lukas, B., and Schembri, S., 2012. Marketing Principles. Stamford: Cengage Learning. Adcock, D., and Ross, C., 2011. Marketing Principles and Practice. London: Prentice Hall. Kotler, P., 2008. Principles of Marketing. New Jersey: Pearson. Appendix Interview Questions (P1) Name: Age: Occupation: Gender: 1. Are you satisfied with the services that are provided by Enterprise Rent-a-Car? 2. Do you find location of the outlets of the company quite easily? 3. What is the most efficient mode of brand awareness of this company to you? 4. Do you get quick response from the company executives if you have any kind of quarry and are you happy with the pricing of service categories? 5. Provide some suggestions to improve the customer service facility aspect. Read More