Services Marketing

Case Analysis:
ZipCar: Influencing Consumer Behaviour

Group 10-Section B
Aishwarya Dhole 2020PGP134

Anoushka Bhatia 2020PGP046

Aravind S 2020PGP062

Mohammed Saheel K 2020PGP246

Sprha Pareek 2020PGP428

Vinetha T V 2017IPM117
Problem Statement -

Zipcar started as a Car-Sharing Company but soon became a humble alternative to

owning and renting a car. It had a large and dynamic vehicle fleet consisting of luxury
cars and SUVs too. The members had to pay an initial fee along with a refundable
deposit and annual membership fees which had a flexible payment window. Both online
and call reservations could be made a year ago or even minutes before the car was
needed. Zipcar changed the car-rental landscape by giving the flexibility of renting the
cars on either payday or per hour basis, flexible booking time, multiple subscription
packages, and transparency in charges.

Karr, who booked a VW Jetta Jericho through Zipcar for an urgent event, couldn't find
the same at the Charles Hotel parking point as it was yet to have been dropped off by
the previous user- Fishman, who was stuck at an interview and was unable to convey
the same to the ZipCar.

Thus due to certain loopholes in the services platter of the company along with certain
business model features, both Karr and Fishman seem to be in a state of quandary.

Situation Analysis-

Sal Fishman being unable to return the car to the Charles Hotel due to his interview
extending beyond what he expected, while Anita Karr panics as she had booked the car
weeks in advance so had expected to drive to her sister’s concert- an important event-
without hitch is a result of unforeseeable and unpredictable circumstances.

Yet the most important component of any service is its customers. ZipCar’s response
could end up alienating both customers and cementing a Negative Moment of Truth in
their minds.
Harsh penalty against Fishman for not returning the car on time or informing the
company would leave him disgruntled and unwilling to use ZipCar’s services again.
On the other hand, insufficient actions to make up for Karr’s negative experience would
induce her to have a terrible perception of the service and generate considerable
negative word-of-mouth.
ZipCar has to balance profit-making with providing quality service and predicting and
eliminating problems customers would face in order to retain them and generate
positive word-of-mouth.

ZipCar’s present rules for customers- pre-defined parking spots, filling up the fuel before
hand-off to the next customer, incentivise to wash and clean the car helped in the
smooth delivery of the service but does not do much to mitigate or solve unpredictable
situations that might arise. These situations lead to ZipCar being unable to fulfil its core
promise to its customers causing ‘Service Failure’. 6.

Recommendations

For customer type 1 (Sal Fishman)

● A combination of app/message notification and auto call can be serviced to the

customer in a strategically determined time range before the booking completion
period.
● Notification of penalty charge for a time violation
● Provision of request for submission and park for emergency and unavoidable
situations for an additional premium
● Send a mobile notification and arrange an alternative for the next customer. The
auto call would give options like press one if you would like to extend the book
time at a premium.
● Penalty system for late return
● Buffer time to be given to the customer or hour wise penalty for exceeding the
time
● Introduce new plan with flexible hours and more fees
● Study customer behaviour pattern
● Window to explain the reason and provide concessions based on that
● Valued customer score based on behaviour

For customer type 2 (Anita Karr)

● Notification for an alternative like do you want to switch vehicle/ replacement

option/nearby location
● Categorisation of vehicles to offer an alternative in case of non-conformance
● Auto call from customer care prior to the booking time to provide vehicle status.
● Premium customer support for booking made by customers in different time
ranges. E.g. separate for booking made for customers a month or week or few
days prior.
● Provision to raise emergency signals to avoid waiting time with customer care.