Car rental is the act of hiring a vehicle for use after a defined period of time and then returning it at the expiry of that period for an identified sum of money. The Car rental business in general has been lucrative of late with increased demands from clients who majorly consist of travelers and locals with either no car or have cars with problems. As an industry, the car rental business is a buzz of activities which could easily be said to have been characterized by the following factors which also do characterize other industries according to the Porter’s five model industry analysis.
1. Discuss the considerations involved in deciding marketing objectives.
Marketing objectives may be considered to be the famous 4 P’s: price, promotion, product and place. In price, the company evaluates the pricing procedures and compares the prices with that of the competitors in the market. Are the company’s prices competitive enough with those of the competitors? If they are not, measures to reduce them would benefit the company to stay afloat in the industry. Promotion is the creation of awareness about the company’s products among the would-be clients. The company will also need to identify which areas to do its promotion with regard to market grip they have. Product refers to the actual commodity of the service offered by the company in its operations. The product should meet the expectations of the clients and meet their needs. In consideration of place, the company should ensure the “meeting” of the customers and the products. How should the company ensure the clients get to acquire the commodities or services by the company? It will equally be vital to consider the characteristics of the market, for instance the car rental industry, one will consider:
a. Perishability
This characteristic is majorly pivoted on the idea of perishability of time. This factor is very vital and should be addressed adequately if a car rental company is to stay in business. This could be done by ensuring a good clientele base through increased marketing and provision of affordable and quality services. Cavusgil, S (1999). There needs to be a customer confidence insofar as the relationship of the customer and the company is concerned. Cavusgil, S (1999)
b. Intangibility
Cavusgil (1994, pp.32-33) this characteristic simply means that the services provided by the car rental companies is intangible, that is cannot be touched. If you would consider, most services are intangible e.g. teaching. This is all possible in regard to the physical nature of the car with the car being the service offered by the car Rental Company or industry.
c. Simultaneity
For a business to be successful there ought to be a need and the need to be satisfied. When on identifies the need and satisfies it, then one has a good business. This rule applies in the car industry too. There has to be someone who needs a vehicle but doesn’t have one at the time of need.
d. Heterogeneity
Heterogeneity her means the similarity of service offered by the car rental industry. The car rental industry is as heterogeneous as some other service industries are this is because they need different levels of attention and different approaches to their unique situations. Cavusgil, S (1994)
2. What is a marketing audit and what is the purpose of it?
Marketing audit is the examination, assessment and evaluation of a company’s market. It’s always conducted during the marketing planning process. The main objectives include the evaluation of the internal and external forces of the market. In the car rental industry, just like any other industry, consider the five M’s in the analysis of the internal environment. These include Money (Finances), Machinery (Equipment), Men (Labor), Materials (Factors of Production) and Minutes (time). Are these factors favoring our product or not? Among the M’s do we have enough of every item? Consideration of the external environment is also vital if not more important insofar as marketing audit is concerned. The external environment is evaluated in terms of the nature of the competitions, the cultural perspective of the market, the legal environment, the economic conditions and the demographic figures Benady, (2005)
3. What are the principal decisions to be made when preparing the marketing plan?
Close theoretical and practical considerations need be put in place. For instance the SWOT, PEST and Porter five models, how these decisions are impact the entire industry. Lets for instance take the car rental industry and assess company in the industry, say Easycar. We assess the strength, weakness, opportunity and threats facing the industry. The strength may be looked as the cost and flexibility, weakness being the convenience of using a taxi, bus or train in a routine form by most users, opportunity is there considering the other companies have not engaged in the same while the threat can be said to be legal constraints facing EasyCar should they engage in this sort of competition.
In accordance to Porter’s five model of industry analysis, one ought to consider the following: threat of substitutes, supplier power, buyer power, rivalry and barriers to entry. For a firm wishing to survive or successfully enter and be in a given industry, it ought’s to consider the above factors and adhere to their theoretical dynamics. They need to develop a good bargaining power, take keen interest in their customers bargains, analysis of the rival of competing firms is equally important if not more than consideration of the threats posed by the new entrants in the industry. The above theory comes in handy when analyzing EasyCar’s maneuver in the car rental industry.
In PESTLE analysis, factors, Political, Economic, Social, Technological, Legal and Ecological come to play. Politicaly, the company will take into consideration of the political atmosphere to operate the bsiness. How political decisions may affect the company and how to adjust should such happen. The economic factor would include will be on the market, how the compnay is impacted by the host company’s economy, the social factor will to assess the compatibility of the company’s activities to the social way of life of the target population. This is important for in a large extent determines the clientele base of the company. Technological advancement will help the company keep abreast with the numerous advances in the industry and reduce costs by espousing technology to cut on the labor costs. The business should comply with the legal surrounding to enable succesful manouvering. In the 21st century,it is eqauly important for a company to consider the environmental effects of its operations and how to lessen the environmental disturbances. Benady, (2005)
4. What are the main criteria for the successful implementation of a marketing plan?
a. Training of new staff
The company should consider a slower speed of expansion that can then be easily funded by their budget. To train all these for such a short period of time may push the company to having debts a factor that may at the end lead to financial instability of the company. The company should first increase on the number of employees on each station before considering training another bunch to be stationed in new stations. Berkowitz, D (1996)
b. Dissatisfied customers
This can be dealt with by close interaction with the clients to get to know of what makes them dissatisfied and rectifying on it. This will be by first increasing on the number of employees to avoid the queues witnessed in most of the stations owned by the EasyCar. It will avoid wastage of clients time queuing Dube, (2000)
Another strategy would be to review their policy of not refunding their customers to may be refunding some favorable percentage to both parties.
The company can also consider having two forms of services with favorable costs, Services that allow for somebody to receive a fully gassed car and can still return the car without washing it or refilling it. This can be done by the company considering the amount of fuel used and including charges of cleaning the vehicle Berkowitz, (1999)
c. Few employees
The company should consider employing more staff to service their clients. This will make the clients feel as though they are catered for and thus gain confidence with the company. The company should also consider reducing on their use of technology basing that this is a service industry and the clients need to be served. The best way to serve a human being is by using another human being.
The employees of the company also ought to be encouraged in order to offer good services to their clients. This will enable the employees to speak well of the company hence acting as a good advert.
d. The legal challenges
The company will need to avoid or reconsider the policies that put it in constant fight with its clients. This will ensure both sides of the business divide gain. The company will increase the customer confidence and the clientele base while the clients would be more content with the services they receive from the company Berkowitz, (1996)
e. Charging policy
The company should consider having a team investigates on means of harmonizing the company’s policy with the clients wants to ensure on the company gains while at the same time the clients are satisfied. Reconsideration of such policies will increase customer confidence with the company and this will see the clientele base of the company rising.
4. Discuss the pros and cons of standardizing the marketing management process.
Is a standardized process of more benefit to a company pursuing a national marketing strategy or a global marketing strategy? The standardization of the market means the application of similar market approaches of a corporation in its countries of operation. This is evident with large multi corporations like coca-cola, Colgate, and EasyCar rental industry. There are several pros and cons of doing this:
The pros include:
Knowledge on using the strategy since the company will have used the strategy somewhere else
Cut of cost since the company may merge resources with nearby regions, this gives the company competitive advantage with other local companies. With the globalization aspect the company will also stand to have a bigger capital base and thus use this while in competition with the local companies. The company segments the market and this way may remain quasi-monopolist in the segment. Standardization also helps the company react effectively and efficiently to changes in the industry.
The standardization also ensures customers confidence on the product. When a product is produced the same way it is produced in other countries, consumers tend to increase the confidence they have for the product which ensures a large clientele base. This translates to huge sales, increase in revenues and consequently higher profits.
The cons include:
When a product enjoys little or no sovereignty in operation, it is subject to be affected by operations of the company’s branch activities. For instance, if coca-colas action in one country will be translated as coca-colas general behavior, this may lead to reduced confidence in the product especially if the action was against humanity. The customers would have negative attitude about the product and will have reduced confidence. It is also difficult at some point to standardize management considering the diversity of policies in different countries. Some countries may not allow certain operations while others would allow. Though for a country
The standardization is more beneficial to a company pursuing international marketing process. This will be ensured by first operating in countries that allow similar policies and then diffusing to the less accommodative areas. It also beneficial considering that internationally, there is likely to be more unexploited markets than in national platform
