BA 627 – Zipcar Individual Assignment
1. Briefly describe at least two competitors (hint: think broadly) for Zipcar. (10 pts)
2. Create a differential advantage matrix for Zipcar and elaborate on the process and insights you reach.
(20 pts)
3. Assume that the average revenue (sales) numbers per car are the same regardless of region. Use
case data (hint: Exhibit 1) to fill in the missing two columns in the following BDI table. (15pts; please
show your work)
Is the BDI number for MA good or bad news for Anita? Explain. (5 pts)
Where should Zipcar focus its marketing efforts and why? (5 pts)
State
MA
NY
NJ
NC
DC
MD
VA
% of Brand
% of Category
BDI
29.52
30.10
5.74
2.31
25.86
3.43
3.04
4. Assume Sal does not return the car and Anita is lost as a customer. What is the financial impact of
this customer defection (hint: lost CLV) if she would have otherwise stayed with the firm for
another 8 years, with the following average usage pattern under the Occasional Usage Plan in
Boston: 2-hour rentals of the Mini each week and one- day rentals of the BMW 325 five times a
year? Retention cost for Anita would have been $45 a year in rental coupons. Use a 5% annual
discount rate for computing the present value of future cash flows1 and assume a 50% profit
margin. (20 pts; please show your work)
5. Devise two specific customer controls (policies) that you would advise Zipcar to implement in
order to make sure cars are returned on time and Sal’s actions do not negatively affect Anita
(hint: think stick/punishment and carrot/reward). Describe two pros and two cons of each. (10 pts)
6. Imagine you are considering the launch of a motorcycle rental company in Phoenix, AZ today.
Estimate your total market potential (in terms of number of customers) via the chain-ratio method
– use at least four filters (search for actual stats online if possible) and explain their relevance. (15
pts; please show your work).
1
From basic finance, PV = CF1/(1+r) + CF2/(1+r)2 + CF3/(1+r)3…, where PV is the present value of the stream of cash flows, CF1 is the cash flow
received in the first year, CF2 the cash flow in the second year, etc. and r is the discount rate.