Enterprise Rent-a-Car Marketing Case Analysis
Enterprise Rent-A-Car | Case # 1 |
Enterprise Rent-A-Car has started its operations in 1962 by establishing and successfully developing a new niche in the car renting industry. The business had strictly focused on replacing local citizens’ cars due to repairs. Later on Enterprise started to serve two additional segments, leisure & discretionally rentals and business rentals. Newly launched segments were successful; however the main focus of Enterprise continued to be the initial business stream – the Replacement Rentals. This business section takes up 78% of Enterprise’s resources, which enables the company to capture approximately 55% of the US replacement rentals market share. Yet, the total replacement Rent-A-Car market accounts only for 27% of the entire US Rent-A-Car industry, whereas business rentals and leisure/discretionary rentals account for 40% and 33% of the market respectively. Thus, the Enterprise market share of the entire industry equals to 14.85%, which is still substantial.
The Enterprise underlying business situation is promising, yet management is concerned with the future growth opportunities. Despite effective operations and therefore lower operation costs, the company still faces several obstacles on its way to a greater success. As Enterprise had taken the “home-city” niche, several competitors had followed to create a harsher competition. Furthermore, it is apparent that Enterprise brand recognition requires more attention as the majority of US citizens are not familiarized with the company’s services. It also becomes harder to hire new employees, as the workplace is not considered to be attractive to the public. In fact, there is an explanation for both of the cases. Enterprise spends a substantially lower proportion of its revenues on advertisements (0.84%), compared to 2.8% other companies in the industry. Yet, regardless of these everyday obstacles that the company has to face with as it grows, the current
Enterprise Rent-A-Car has started its operations in 1962 by establishing and successfully developing a new niche in the car renting industry. The business had strictly focused on replacing local citizens’ cars due to repairs. Later on Enterprise started to serve two additional segments, leisure & discretionally rentals and business rentals. Newly launched segments were successful; however the main focus of Enterprise continued to be the initial business stream – the Replacement Rentals. This business section takes up 78% of Enterprise’s resources, which enables the company to capture approximately 55% of the US replacement rentals market share. Yet, the total replacement Rent-A-Car market accounts only for 27% of the entire US Rent-A-Car industry, whereas business rentals and leisure/discretionary rentals account for 40% and 33% of the market respectively. Thus, the Enterprise market share of the entire industry equals to 14.85%, which is still substantial.
The Enterprise underlying business situation is promising, yet management is concerned with the future growth opportunities. Despite effective operations and therefore lower operation costs, the company still faces several obstacles on its way to a greater success. As Enterprise had taken the “home-city” niche, several competitors had followed to create a harsher competition. Furthermore, it is apparent that Enterprise brand recognition requires more attention as the majority of US citizens are not familiarized with the company’s services. It also becomes harder to hire new employees, as the workplace is not considered to be attractive to the public. In fact, there is an explanation for both of the cases. Enterprise spends a substantially lower proportion of its revenues on advertisements (0.84%), compared to 2.8% other companies in the industry. Yet, regardless of these everyday obstacles that the company has to face with as it grows, the current