As technology reinvents the travel experience, the rental car business is finding itself on the move
By Mark Rowh
Over the past decade, the biggest news in ground transportation has undoubtedly been the rise of the sharing economy. But equally impactful has been the rapid emergence of new technologies. Traditional rental car providers have not been standing still, bringing a host of enhancements in both customer-facing functions and back-office operations.
Perhaps nowhere has this become more apparent than with Enterprise Holding’s recent acquisition of Deem, the Silicon Valley-based provider of travel booking and management tools. Over the years, Deem had built a client base that included more than 50,000 corporate customers as well as the world’s largest travel management companies.
The acquisition follows a long history of partnership between Deem and Enterprise through the latter’s small and medium business platform, EHIDirect, according to Don Moore, vice president of corporate business development, Enterprise Holdings. More recently such progress has been seen through the National Car Rental brand’s National Car and Driver in China, which is supported by Deem’s Work Fource application.
“This acquisition offers an exciting opportunity that reaches beyond traditional travel,” Moore says. “It provides our customers and both of our businesses – Deem and Enterprise – with a robust technology platform that will further enhance our ability to create innovative solutions to support the future of transportation.”
The Deem move is one of several investments and corporate-venture capital acquisitions totaling $2.4 billion that Enterprise has made since 2008 in the US, Canada, the UK, France, Ireland, Spain, China and Brazil. Enterprise planners expect the latest development to pave the way toward substantially enhanced technology capabilities.
“When we think about our future as a provider of transportation solutions, our focus is on how to help people everywhere get from Point A to Point B and make the experience as easy and convenient for them as possible,” Moore says. To that end, the acquisition provides Deem with the capital and resources to help further expand its product roadmap and increase the pace of product development and enhancements, he explains. The desired result? Speeding up the process of bringing viable travel technology to market.
Greater Connectivity For Enterprise, enhanced connectivity is a major objective. By 2020, the company anticipates having several hundred thousand cars fully connected. Moore predicts that Enterprise will eventually have the largest fleet of connected vehicles in the world. “In the future, and depending on a customer’s preferences, a connected fleet will put our customers in control of the experience,” he notes. “Through this technology, a customer will be able to rent a car with little or no assistance.”
Among other advantages, this will mean reducing the time that customers spend booking a vehicle, picking it up and dropping it off at an airport or a neighborhood location. Moore says that by leveraging technology investments, including Deem, the experience that connected cars can offer will be greatly enhanced.
For example, drivers will be able to rent a car 24/7, ultimately being able to unlock the vehicle through a mobile app. The car will then automatically check customers in and then check them out as soon as they approach geofenced areas around branches. Cars will also talk to customers and tell them when gas is needed and where the closest station is located. And on the operations side, advanced tech will put more power into the hands of employees to optimize the fleet, getting new cars into the fleet and expediting delivery to customers.
Moore adds that operating as a total mobility provider requires a diversified approach. For Enterprise Holdings, that means a portfolio of transportation solutions that includes car rental, car sharing, van pooling, car sales, truck rental, online ride-matching, exotic cars and affiliated fleet management services. All, of course, depend on constantly evolving technology.
Continually advancing tech is also the story at Sixt, which has a long history of developing its own innovations. Most recently, the Germany-based company has launched a mobility platform that combines digital car rentals, car sharing, ride and taxi services.
The move reflects the commonality of the various options available to business travelers, says Daniel Florence, chief operating officer of Sixt North America. “It’s the same concept,” he explains. “Irrespective of whether you’re renting a car or car sharing or ride hailing, you’re still renting a mobility solution.”
Sixt customers in Germany can already select their vehicle digitally at top airports up to 30 minutes before the start of the rental period, proceed directly to the car without stopping at a counter, and open the vehicle with the company’s app. Plans for this year include expanding to other airports in Europe and the US as well as selected stations in urban areas. And through accelerated expansion of its network of stations, the company’s strategy is to get closer to its customers and bridge the gap between traditional car rental and stationary car sharing.
For Avis Budget Group, providing new mobility solutions means both enhancing technology internally and embracing transformative partnerships, says Arthur Orduna, chief innovation officer. “We’re exploring and piloting ways to add more convenience, value and safety to the entire journey of both our business and leisure travelers, primarily by leveraging our growing connected fleet and our digital mobile platform,” he says.
The company is exploring enhancements to the customer experience through smart city integration and services, multi-modal opportunities (especially through its brands in Europe) and testing of new and emerging technologies. These steps include expanding integrated fleet services as well as providing more on-demand self-service options through Budget Truck’s pilot with self-service truck-rental marketplace Fetch. In addition, Alexa voice services have already been launched for both Avis and Budget customers.
The company’s app is constantly evolving to meet customer needs and has helped bring positive ratings, according to Orduna. Customers can employ it to make, modify or cancel a reservation, view and choose available cars, and return them without assistance. They can also lock and unlock car doors, flash car lights to locate a car, and more.
“We’re seeing substantial improvements in our net promoter scores signaling that we are meeting or exceeding our customers’ expectations,” Orduna reports. Not only have promoter scores risen by 6.6 percent, but customer satisfaction ratings have increased by 20 percent. And through arrangements such as a partnership with Arrive, the parking platform that has led to an integrated parking assistance app, additional ways to alleviate traveler pain points are being developed.
Another area of intense interest is connected car technology and how the connected car can transform the customer experience as well as the business itself. “Connected cars allow Avis customers to manage their entire rental through the app and allow us to have more cars available for our customers faster, due to improved fleet management capabilities,” Orduna explains, adding, “We see a near future in which connected cars will know preferred seat position, car temperature, radio presets and more.”
In achieving these and other goals, one asset is a mobility lab in Kansas City that serves as a test bed for fully connected vehicles and operations. “Better information, delivered in real-time, leads to a more efficient workforce, better maintained vehicles and ultimately a better customer experience,” Orduna says.
Avis has also found a place in the ride hailing domain. “Sharing economy players are an integral part of the mobility landscape and we consider them partners,” Orduna says. Through a partnership with Lyft, it’s now possible for drivers to reserve an Avis rental vehicle from within the Lyft app. The partnership makes it easier for people to drive with Lyft without the cost and burden of car ownership.
“We are well positioned to take advantage of the continued growth in the ride hailing space by providing drivers on-demand access to clean, safe and well-maintained vehicles,” Orduna notes. “And a key differentiator is that our dedicated fleet for Lyft is completely connected.”
That may provide important advantages for both companies, such as pre-emptive maintenance of vehicles and optimized utilization of the overall fleet.
Other new and potential developments for Avis Budget include additional digital products for its mobile platform. “We’re also looking at ways to customize and personalize a journey for individual customers that could carry over to all their future rentals, leveraging new data management and analytics partners such as Amazon’s AWS team,” Orduna says.
The ultimate goal is the reinvention of the business traveler rental experience. That vision includes a growing connected fleet and integration with global digital partners through a new API software platform and other cloud-based technology.
Broad-based Benefits Many of the latest innovations target travelers. But improving their experiences can also supports the objectives of travel managers. “The emphasis on the traveler and traveler experience is more important now than ever,” Moore says. “This, like many aspects of travel growth, is driven in part by the economy.”
When the economy is strong, Moore notes the traveler is center stage and the quality of the traveler experience is top of mind. But when the economy is in a downturn, concerns about price and costs rise to the top of the list, often to the detriment of the traveler’s experience and sometimes causing friction between supplier and customer.
“We envision a platform that will ultimately be relevant, regardless of the state of the economy,” he says. This means accounting for preference, policy and friction. “From our perspective, when you give any traveler the right solutions and the ability to efficiently manage their entire trip, this will ultimately benefit everyone and provide the most satisfying experience.”
Florence says that smart planning means taking what you know people want from mobility and using it to your advantage. “That’s really the question for travel managers,” he says. “How do you serve your customer from a total mobility perspective?”
Orduna recommends a data-driven approach. “Before you can make use of rental car services effectively, you need to develop an in-depth understanding of your company’s travel patterns and habits through data and analytics,” he says.
He points to his company’s business intelligence tool, launched in February, which offers corporate customers direct access to relevant data. The online portal includes rental summary dashboards, visualizations and detailed reports on program performance. He says access to such a portal will help travel managers make the best use of rental car services, capitalize on their benefits, and better manage corporate travel expenses.