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Like many consultants, I travel a lot for my job.  Because I work in the travel industry, I am unlike many frequent travelers in that I don’t always use the same suppliers. Part of my job is to stay abreast of trends in the travel industry, so when I hear about something new or different, I try to check it out on one or more of my trips. Recently, I’ve tried a couple of interesting services in the ground transportation space: Silvercar and O'Hare Personal Valet. Both meet longstanding traveler needs with new customer experience models. 

Silvercar has been around for a few years now and has been written about a fair amount. The company has done a great job of re-imagining the rental car experience for today's smartphone-toting, app-centric world, but it seems that it hasn’t yet figured out the commercial side of the business. First, the great part: I was able to do every step of my rental, from initial signup to return, using the awesome Silvercar app, which is simple, logical and intuitive. The cars are nice (the fleet consists of silver Audi A4s), and the employees are friendly and professional.  However, it seems that Silvercar hasn’t figured out the rental car business yet. 

After opening initially with a large fleet in one on-airport location (Dallas/Fort Worth), the company has moved to an off-airport model with roughly the same fleet broken up into much smaller locations. Silvercar is doing its best with the off-airport handicap—the company will pick you up at the terminal—but the Austin location, in particular, struck an off note. It’s in a converted gas station next to an establishment that is either a dive bar, or a "gentleman's club" (I didn’t care to investigate which). Plus, the pricing is overly simplistic, with just two price levels—both of which, as you might expect from the all-Audi fleet, are premium-priced. Finally, the network of locations strikes me as odd, with some locations (like Ft. Lauderdale) being leisure-travel-heavy, some (like Chicago) heavily business-oriented and some in between. What customer segment is the company trying to reach? 

This last point would be my biggest concern if I were running Silvercar. It’s hard to succeed in the travel industry without a clear focus on the kind of customer you’re trying to win. For Silvercar to grow, it’ll need to pick a segment and shape its location network, offering and customer experience to fit. Some travel brands that are doing well targeting a specific segment are Aloft (millennial business travelers) and Allegiant (budget-conscious leisure travelers who live in smaller cities and towns). The value propositions for these brands are clear to their target audiences, and are very appealing. Not surprisingly, both brands have been quite successful and are growing quickly. 

The value proposition for O'Hare Personal Valet (OPV) also is very clear: The company’s service saves you time and money, and it’s convenient. OPV is basically off-airport parking with a twist: You don't have to go to the off-airport location and cram into a small bus or van with your luggage and a bunch of other travelers. Instead, company representatives meet you curbside at the terminal and take your car to the lot. Upon arriving back at O'Hare, they meet you curbside with your car. Pick-up and drop-off cost $30 each, or $5 less than one-day parking at ORD's short-term parking lot. Actual parking is at typical off-airport parking rates, with a choice of covered or outside parking, and the usual optional services of car washing, detailing and such. OPV also is smartphone-enabled, using Glimpse to know when you’re close to arriving at the airport, and texting for other communications.

I’m not sure if such services exist in other cities, but I think that this is a business model ready to scale. Add a custom app and a few other features, and this is a compelling startup opportunity.  Or maybe one of the large off-airport parking operators, like The Parking Spot or Preflight will jump on this concept. 

The largest weakness that I saw with OPV is its marketing. While I think that the service is great, I found out about it purely by happenstance. My wife was talking to a friend who had heard about OPV from someone else—you get the idea. Word of mouth might be a strategic approach for the startup, but the brand seems to lack a substantial marketing plan. A quick Google search revealed the brand’s Facebook page and some consumer-generated reviews—and little else. My fellow consultants and I even appear to fall within OPV’s target market: people who travel often, value convenience and are willing to pay a bit more for it. As a frequent traveler in and out of O’Hare, I’d think that I’d have encountered the brand at some point before I heard about it secondhand from my wife’s friend.

A great business idea without sufficient marketing is just that: an idea.


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Topics: Glenn Hollister, Corporate Travel, Business Travel, silvercar, O'Hare Personal Valet, ground transporation, startups, travel and tourism