Read the case study Zipcar given below and answer the follow questions:
Analyze the business model of Zipcar using Porter's five forces model.
Discuss the synergy between the business strategy of Zipcar and information technology.
What network effects is part of the strategy of Zipcar? How do they add value?
As the CEO of Zipcar, where is your most threatening competition? What would you do to sustain a competitive advantage?
CASE STUDY 2-2 ZIPCAR
Zipcar was ananswerforcustomerswhowanttorentacarforafewhoursintheirhomecity,ratherthan for a few days from a traditional rental agency. Car reservations were for a septic pick-up time and location around the city, often in neighborhoods so the customers need only to walk to pick up their reserved car. Customers applied for a Zipcard, which enabled them to reserve a car online and unlock their car when they arrive at the car's location.
The company operated with a very small staff compared to traditional rental agencies. Very little human interaction was required between the customer and Zipcar for a transaction. A customer reserved a car online, entered into the reserved car by waving the RFID-enabled Zipcard against the card reader mounted behind the windshield on the driver side, returned the car to the same location, and was billed on the credit card already on ale. The customer could check all rental records and print receipts from the online reservation system. The system also had a color-coded time chart showing availability and location of all rental cars in the vicinity. This transparent information exchange allows a customer to pick the car he or she wants, if available, or delay the reservation until the car was returned by another customer. Zipcar also created and installed a GPS-enabled wireless device in each car, which allowed members to and and reserve a nearest vehicle using a cell phone. Customers also can use an iPhone or Android app on their iPhone or Android mobile device to and and reserve a Zipcar on a 24/7 basis. Zipcar sends text alerts near the end of the rental period and customers can text back if they want to extend their rental time.
All the cars were ousted with patented wireless technology. Their proprietary IT platform carried information how between customers, vehicles, and the company. It was used to monitor car security, full reservations, record hourly usage, and maintain mileage information. It also relayed vital technical information such as battery voltage and fuel level. It even informed the central system if a customer forgot to turn off headlights, which can quickly drain battery power. This business model provided unique advantages over traditional car rentals. The customer did not have to stand in line or all out papers to rent a car. The customer knew exactly which make and model he or she would be getting. Unlike most off-airport rental agency locations, which were only open during business hours, Zipcar locations were open 24hours.