The Value of Dominating Underserved Markets
"The Value of Dominating Underserved Markets" by Oren Harari. July 9, 2008
If you dearth to win a quick bet, ask your friends which car rental company is the biggest in North America. If they say Hertz or Avis, you can grin and shake your headand pocket your winnings. Then titillate them further and say that this business is the most profitable car rental company too.
Its Enterprise. Whats the secret? Well, first, a proper institutional commitment to customer serving. (As rated by independent players like J.D. Powers and Shop Matrix, Enterprise consistently receives the highest consumer satisfaction scores in the industry).
But the genuine competitive whammy is that the companys commitment to serving, and its extraordinary growth, has been wrapped around a one of a kind business model. Rather than competing later on against huge powerhouses like Hertz or Avis in airports and hotels, Enterprise grew by structure, and dominating, a previously underserved marketin this prove the home city market. In hindsight, it seems brilliantly apparent how often we need a car in our own town or citylike when our car needs unemotional repair, or is in an accident (or stolen), or when out-of-township relatives come stay in our about and need a car for just a couple days in the waist of their holiday, or when an out-of-town business associate without delay needs a car for a few hours in the middle of the day in shipshape to get to a couple appointments. At that stress, a nearby Enterprise office (strategically located, theres a divide office within 15 miles of 90% of the U.S. natives) will send someone to pick you up, provide you with a genuinely obstinate concierge service, and then after youre done with the car, drop you off. Enterprise still dominates this lucrative sell, and whats more, the growth of the brands customer constancy became so profound that Enterprise was able to expand cautiously, but profitably, into the big competitors...
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