Igor Ansoff identified four growth strategies; Market Penetration, Product Development, Market Development and Diversification. Ansoff’s Product-Market Growth Matrix is a commonly taught Strategy Matrix in MBA programmes and many case studies may be related to the four Ansoff quadrants; Virgin Group for its diversification into new markets with new products, Coca Cola for its Product Development with introducing ‘new Coke’ to existing customers (oops…that was a total failure) etc. Well Europcar may now be added to the list of Product Development strategy proponents.
Europcar Sells Packaging and Photo Services
I don’t hire cars often and was very interested to see on a recent trip to Canberra that Europcar Australia’s Product Development strategy includes; Packing Supplies and iPix among the common options (GPS rental, babyseats etc.). Packaging Supply comprises Europcar selling cartons, tape and other packing essentials. iPix is essentially a photo album. These services/products are sold at the Europcar retail outlets themselves.
Meeting Customer Needs and Wants
What is so very clever about this Product Development strategy is Europcar have obviously thought about what their car and truck rental customers often do with the hire cars and trucks. They have then developed desirable products that satisfy these needs or wants. Through selling these needed or wanted products to existing customers there is no additional customer acquisition cost as the customer has already been attained through the renting of cars and trucks. Customers spend however increases through the purchase of these additional products and customer loyalty is enforced as the customers needs and wants are being better met.
A Great Strategy
Europcar in Australia has shown that their strategy is well formulated and that they are very in touch with their customers’ needs and wants.