“We are redefining the way people think about transportation” (1)
Zipcar has established itself as the leader of cars on demand. Their business model is to provide an efficient, easy to use and trusted alternative to facilitate transportation and defy the need for traditional car ownership. Through a membership and the use of a “zipcard”, “most residents of major cities will live within a five-to-ten-minute walk of a self-service Zipcar”. (2)
With over 900,000 members and more than 10,000 vehicles in urban areas, the system that Zipcar has in place is mostly automatized and depends heavily on the community.
As a car sharing platform, “Zipcar offers its members the freedom of on-demand access to a fleet of vehicles at any hour of the day or night, in their neighborhood or in any of our Zipcar cities and locations, without the cost of hassles of vehicle ownership” (3)
The operating model of the company has several characteristics that reflect the effectiveness of the business. These can be summarized in the following elements:
- Keep it simple:
The platform is extremely simple to understand. Through the phone or the computer, every member can see all the zipcars that are available when and where needed. With only one tap, a member can reserve a car.
Moreover, the same zipcard that identifies you as a member works as the car’s key. As soon as your rental time starts, your card will activate and open the car. You just have to walk to the car you selected.
You can drive wherever you want. You don’t have to worry about the miles, the gasoline or the insurance. All of them are covered by the price and the membership. Just be aware of the time you selected to return it.
- Trust and confidence:
As mentioned above, the company has the ambitious goal of having a zipcar location less than 10 minutes away of every member and major city. This reflects the commitment of the company and the trust it is trying to build with customers.
Also, there is a continuous message of responsibility directed to the community. Every user is constantly reminded about the importance of leaving the car clean, in good shape and with enough gasoline. Being a Zipster is like being part of a club, where all the members are responsible for the good shape of the business.
The mission of the company is not only to help its users reduce their monthly budgets but also to change the world. Just as they mention on their website: “We envision a future where car-sharing members outnumber car owners in major cities around the globe” (2). This commitment engages the potential users, such as millennials, who prefer more sustainable and environmental-friendly initiatives.
In the end, the technology friendly system and the community involvement are crucial for Zipcar’s success. Both elements are very important, especially under this highly capital intensive business.
1) Zipcar (2015). Website: http://www.zipcar.com/about accessed 12/04/15
2) Zipcar (2015). Website: http://www.zipcar.com/mission accessed 12/04/15
3) Avis Budget Group – Annual Report 2014
4) Zipcar (2015). Website: http://www.zipcar.com/press/overview accessed 12/04/15