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Shifting Gears: Can Avis' Acquisition of Zipcar Accelerate Growth?

Posted by: Kurt Munger and Caren Williams on Monday, January 7 2013 05:29 PM

Zipsters, the passionate and loyal customers of Cambridge-based Zipcar, may have collectively groaned as it was announced that a traditional car rental company will acquire the beloved car-share pioneer. Despite fears that their go-to for “wheels when they want them” could become lost in the rental car industry it set out to disrupt when Avis Budget Group acquires Zipcar for $500 million, the deal creates interesting possibilities for these two brands to leverage the best of what each can offer.

The Zipcar counter-culture consumer base is loyal to its brand, but these fans are also passionate about the financial and environmental benefits Zipcar brings to society. This acquisition can be the means to bring the benefits of car-sharing to more people than ever before.

Tech-savvy and open-minded Zipsters are just the community of consumers a company like Avis can tap into to elevate their brand in a changing market. The Zipcar community is open to sharing and consuming only what’s needed. The brand evokes perceptions of fun, ease and excitement.

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With Zipcar in their portfolio, Avis will have an opportunity to target new consumers with a product that works for their lifestyle. Zipcar can help shift Avis from a commodity category, with consumers focused on getting the lowest price or banking the most loyalty points, expanding the car-sharing market for everyone.

The benefit of the deal for Zipcar, a progressive company with cool ideas, a loyal user following and a proven infrastructure, is the acquisition represents a way for them to expand their brand and the entire category of car-sharing into new markets. Since the car-sharing market is still relatively new and inexperienced, Zipcar appears to have reached a plateau of sorts in regards to getting new users.

This is where the Avis brand can help grow the car-sharing category. It can help capture the “more traditional” audience, introducing them to car-sharing with its recognizable brand name, scale of fleet and locations.

Both brands have some homework to do. As with most acquisitions, it’s not just a question of how to integrate the operations and the P&L, it’s about understanding how to remain authentic to your current consumers while evolving and becoming more relevant to new ones.

2012 had its fair share of pairings – including Disney/LucasFilms, Delta/Virgin Atlantic and Starbucks/La Boulange – that surprised communities of brand loyalists. Yet each suggests areas of growth opportunities for all involved. As 2013 begins with the pairing of Avis Budget Group and Zipcar, the road ahead for both brands looks promising. Sometimes unlikely pairings can yield rich results, and we, like many others, will be eagerly watching their next move.

Kurt Munger is Creative Director and Caren Williams is an Associate Director Brand Strategy at Interbrand San Francisco.

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