Enterprise should position the subcategory instead of fighting a brand battle

Enterprise Rent-A-Car launched a new ad campaign in March in which they moved beyond value (weekend deals) and convenience (We’ll pick you up) to feature their service commitment, the professionalism of their people, the fact that employees are empowered to solve customer issues, and their heritage as a family firm. And the story is told by Enterprise people who add connection, interest, and credibility. The brand is thus defining itself in terms of its organization, its people, policies, and values, and is not focusing on comparing functional benefits with other firms.

My take is that this is exactly what Enterprise should have been doing all along. They should recognize that they formed a new subcategory in the 60s and 70s that always has been very different from the other rental car companies. Enterprise has aimed to serve those who need a car locally because they have a car under repair or want to take a locally originated trip as opposed to the “heavy users,” those using airports for business or leisure travel.

To win with this business, customer service and personal relationships were critical and Jack Taylor who founded the firm in 1962 in St. Louis had that insight from the beginning starting with an insistence on a distinctive professional dress and courteous demeanor. Taylor’s vision prevailed, Enterprise has been the number one car rental company for the last seven years in customer satisfaction according to J.D. Power and Associates.

Their success with customer satisfaction is no accident, it is based on substance. Their people are hired and evaluated on their ability to deliver customer satisfaction. One of every fifteen customers is interviewed to determine if he or she is completely satisfied. The percent that check the “completely satisfied” box becomes a key performance measure for each branch. Each of the 6,000 offices have an entrepreneurial spirit and are empowered to resolved issues on the spot. They are also the source of many of the firm’s innovations. The “We’ll pick you up” promise was created in 1974 by an Orlando office manager. And it is all based and supported by the family firm with a strong culture and values honed through a history stretching back nearly five decades.

In my eyes, Enterprise for much of its existence has not been fighting a brand preference battle with Hertz, Avis, and the others. It has rather been winning the brand relevance war by creating a subcategory in which its airport-based competitors were not relevant. For over 40 years it virtually had no competition and for 30 years it did no advertising and was under the radar of the industry. It now dwarfs Hertz in both sales and profits.

As competition finally is introduced into their space, the best strategy is to be the most authentic and most competent competitor in the subcategory that they created. It is a mistake to change, to become a competitor in the larger rental car space. Enterprise should not try to fight a brand preference battle on the turf of Hertz and Avis but, rather, should exclude them from the space that they have created over four decades.

Posted March 22, 2011 / Permalink / Subscribe (e-mail) / Subscribe (RSS)
Tags: avis enterprise rent-a-car hertz subcategory

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