Historical Fiction (Perhaps)
During their regular quarterly meetings the directors of Daimler AG carve out time to review new ventures. This time a youthful market researcher proposed establishing a car rental business. These senior automotive executives could barely contain their dismay. The business was, after all, well established, mature and very competitive. Significant barriers to entry were an additional deterrent.
Prior to World War II many new rental firms entered the industry. Not until airline travel blossomed that demand for auto rentals grew. Now passengers at airports needed convenient ground transportation to replace the traditional buses and taxis.
New auto rental companies proliferated and existing agencies expanded, feeding on the very rapid growth of airline travel for business and pleasure. Avis and Hertz attained major shares. From time to time automobile producers acquired significant equity positions as an outlet for their cars and to introduce their brands to potential buyers.
Pity the poor market researcher now facing this entrenched group of directors with an idea long since discarded.
She quickly got their attention. The proposal was not the traditional care rental business rather, for a whole new venture in a new industry featuring the Smart car. In partnership with Swatch, the Swiss watchmaker, Daimler pioneered the Smart. Initially unsuccessful and almost abandoned until 2006 when a redesign, and great fuel economy, caught the consumer’s attention. The now familiar auto features a very small, reliable, agile vehicle suited to the crowded urban environment. Carrying the Daimler brand helps as well.
The proposal: Marry this auto technology with the communications revolution to meet the new demand for instant convenience in urban driving. This is a new business in a new industry. The Smart Car and associated systems are monitored by GPS, to track its route, fix its location and to calculate rental fees. The driver picks it up almost anywhere and leaves it almost anywhere. The Smart’s size and agility makes parking very easy. Consumers are treated to on-demand, low cost, convenient, personal urban transportation.. They have pay –as –you- go time sharing in autos.
The combination of new auto and communications technology now puts this car rental business in a whole new light. Daimler now has a new market and a new way of promoting the Smart.
The market researcher has attained a new stature and the car2go business is born.