Micro-analysis: SWOT

Strengths:

  • Cool and modern brand image
  • Unique technological platform
  • A lot of experience in the industry (1)
  • “Save-the-Earth” strategy
  • Avis is already operating in Russia (2)

 

Weaknesses:

  • No experience in emerging markets
  • Low brand awareness in Russia

 

 

Opportunities:

  •   Increasing environmental concerns
  • Government support of eco-cars and development of infrastructure (3)
  •  Partnerships with government and car plants (4)
Threats:

  • Increasing rivalry and substitute services (car rent, taxi, public transport)
  • Russian consumers are not familiar to car sharing
  • No infrastructure
  • High level of corruption and bureaucracy

Notes:

(1): Zipcar is a leading company in US. It enjoys first-mover advantage and therefore are well-aware of specifics and pitfalls in the car sharing industry. This experience might be helpful in expanding to another markets

(2): Avis is operating in Russia for more than five years, since Zipcar is its subsidiary that has no experience in emerging markets, it would be easier for Zipcar to enter Russian market with Avis’ experience

(3): From 2014, Russian government implement new legislation in order to support and promote the use of electro-cars. For instance, zero-tariff on the import of such cars and more facilities for service (charging and service stations). That might be crucial if Zipcar decides to continue its “green strategy” and will try to raise electro car culture in Russia.

(4): Since car sharing business requires of the company to own a wide-range car park, one of the possible solutions is partnerships with car assembly plants. Ford, General Motors and Nissan are successfully operating in Russia and might be considered as potential partners. Also, following from the previous point, Zipcar might be supported by government as a part of promoting electro-cars program.


To sum up: Although today car sharing is not well-spread service among Russian people and many things should be overcame in order to build profitable relations with customers, there are a lot of opportunities for the industry here. Moreover, Zipcar has several strategical advantages that will help it to become successful in Russia.

6 thoughts on “Micro-analysis: SWOT

  1. So the company would have to provide the electro chargers? I assume there is nothing like that on the Russian streets yet, do you know? Can you load at tanking stations (in Switzerland it is possible I think). Very interesting micro-, meso- and macro-level analysis by the way!!!!

    • Thanks for the comment!

      The first step is to introduce the Zipcar carsharing service in major cities in Russia with the gasoline cars fleet only. Unfortunately, current conditions make it difficult to lauch the service based on the electric cars. Electric-cars launching is the next step (the long-term perspective) as it requires significant investments and change of infrastructure.

  2. Ksenia, I have just asked you a similar question in one of the previous posts, but I’ll ask more specifically here:I totally agree that Russia’s infrastructure will prevent you from introducing electric cars – it would be a nightmare. Still hybrid cars are quite spread in Russia – how about using them?

    • The problem with hyblid cars is their initial costs. I have looked through a price range for hybrid cars and it is 2-4 times higher than for the cars we are thinking to introduce. Anyway, the point with hybrid cars is under consideration as we understand that such type of cars can be attractive to “green conscious” drivers.
      What do you think, is it reasonable to introduce the hybrid cars just the early stages of launching the service? Is not it better to first focus more on cars availiability and accessability for users?

      • The matter is that hybrid cars are the first thing that comes to my mind about “green driving”, so it might a question also for potential consumers: “Why don’t you offer hybrid cars if you say to care for the environment?”
        So I would just introduce at least 3-5 hybrid cars to the fleet, if it is still costwise. Here we cannot say precisely unless a deeper cost analysis is done.

  3. Thank you for the comment! The fact that if people start using car sharing, it can significantly reduce the number of cars on the road, that positively effect on the environment. But I realize that this situation is ideal and cannot be achieved in the short-term. We really think about introducing hybrid cars especially taking into account that government support such initiatives:)

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