Zip Car Analysis

Key problem and related issues

Basically, the issue in the case is the possibility that Fishman may extend the reservation and what should Zipcar do if he is unable to contact with Zipcar timely. Put it in a broader picture, what actions Zipcar can take in order to efficiently and effectively manage its car-renting service by influencing its customers’ behaviors?

Potential solutions and reasons

There are several potential solutions can be provided. (Exhibit 1) Firstly, Zipcar can install GPS in all the cars that it owns, so that information of cars can be more accurately mastered. Thus, Zipcar can contact the renter timely and assign other cars to the appointed location to eliminate the communication problem because tracking system would indicate the condition in advance. Secondly, Zipcar could build up a strict reward and punishment system by giving discounts to those who return cars on time and charging extras to those don’t. Thirdly, Zipcar may give customers a variety of options of their renting. For example, options such as “no late return,” “allow late return up to 2 hours” or “allow late return up to 4 hours” and different options will be charged differently to influence customer’s behavior so that Zipcar have more controls to manage its cars. Among these three alternatives, the first one makes Zipcar available to catch more information on customers’ specific positions but is less effective upon changing customers’ behaviors. Oppositely, the latter two alternatives will be able to significantly influence customers’ behavior by putting customers’ interests in stake. The problem with the latter two is the relationship between Zipcar and its customer will become more rigid.

Exhibit [ 1 ]