There are few retail experiences as cheerless and bleak as renting a car.
If you are not waiting at a desk in what feels like a makeshift shack at an airport garage, you are lining up under humming fluorescent lights at a counter with all the charm of a passport office.
Two years ago, the second-largest car rental company in the United States decided it needed to change that. Now, Hertz Corp. has begun rolling out the results of its rebranding effort, a reported $100-million project known internally as North Star. To guide that project, it looked north.
Toronto branding and marketing firm Jackman Reinvents was charged with revamping Hertz. The question now is whether customers will respond.
“In this category, like in pretty much every other retail category, there is actually a fair bit of promiscuity,” CEO Joe Jackman said. “Loyalty is sometimes the lack of a better option, these days.”
The attempt to attract more loyalty comes at a challenging time for Hertz. Last month, the company lowered its earnings forecast for this year. It cited falling consumer confidence and U.S. government cutbacks that ate into its largest segment, airport rentals – as well as other travel businesses, such as airlines and hotels.
More than 600 Hertz locations worldwide, mostly smaller off-airport stores, have already been given the new look and, in May, the company’s first U.S. airport flagship location opened in San Diego. The changes are all designed to make car rentals faster, easier, and – although Hertz wouldn’t put it this way – less miserable over all.
There is no place to wait in line. If customers are not immediately served, they are given buzzers to notify them when an agent is free, and allowed to wander. There is coffee, WiFi, and a lounge. In some locations, there is a showroom area where visitors can ogle Aston Martins and Porsches.
“We’ve made the whole place look much more like a retail store, and much less like a bank counter or an airline counter,” said David Trimm, Hertz’s senior vice-president of business transformation projects. “We want it to be a personal experience, and we want customers to feel like what they did with us didn’t waste their time.”
The changes go beyond brick-and-mortar locations. The company is putting a renewed push on its loyalty program – which costs nothing to the customer, but is an increasing priority for many marketers in an age when collecting and analyzing data on customers’ identities and purchasing behaviour is crucial.
Bypassing the counter is a big part of how Hertz wants to draw them in. A mobile service developed with Jackman, called Carformation, will allow loyalty members to book a car from their phone and bypass the counter altogether. When they arrive at an airport or other location, Hertz will send them a text message saying where their car is parked, and the code for the lock box where its keys are held (the keys are already in the car in some cases). They can click to choose another model if they do not like the car, and drive away without ever having to enter a rental office. It has sped up and redesigned its website, and introduced automated kiosks at some locations.
“I liken it to the day that ATMs became the norm,” Mr. Jackman said.
Jackman also made changes more commonly associated with a rebrand: It gave Hertz a new look, changing the design of the logo and even tweaking its signature yellow colour from a “roadside” hue to a brighter lemony shade to signify energy and speed.
All this is designed to target a premium car rental customer, which Hertz is able to do more specifically following its $2.3-billion (U.S.) acquisition of Dollar Thrifty Automotive Group Inc., a mid-tier brand. That purchase allows Hertz to have different brands for different customers, Mr. Trimm said.
He also suggested that the company’s other brands could see their own North Star projects in coming years.
Jackman got the gig after its work helping to revitalize the Duane Read chain of convenience and drug stores while it was still under private equity ownership. It was during the recession, and the chain had an excellent footprint in New York but was far from beloved.
Under the Canadian-born, then-CEO John Lederer, Mr. Jackman was named acting chief marketing officer, brought on to help remake the retailer’s look, as well as its operations. Following the rebrand, Walgreen Co. acquired Duane Reade in 2010 for $1.1-billion.
Hertz CEO Mark Frissora is on the Walgreen board, and decided to bring in Jackman to discuss how the car rental company could remake its brand as well. What set them apart, Mr. Trimm said, was the devotion to customer data and analysis. Every change made is based on that.
Jackman has also recently been working with Sobeys Inc. on a new strategy, and does most of its work with U.S. clients.
One of the people Jackman put on the team for the Hertz project was Tom Froggatt, who worked with Canada Post for 12 years and helped the post office develop a look for its stores in 2002-2003. Mr. Froggatt, who had worked at Loblaw and Maple Leaf Foods in the past, calls the Hertz project “probably the most exciting marketing adventure I’ve gone on.”
“Hertz created the industry of car rental,” he said.
But that industry is going through plenty of change. The popularity of third-party websites, such as Expedia and Priceline, has aggregated travel purchases. That means that, often, customers choose less to stay in a Marriott or rent a Hertz car specifically; an algorithm chooses that for them based on their criteria.
“The consumer, and the market behaviour, was changing around them. … That’s a scary place for brands like Hertz and others to be,” Mr. Jackman said. “Because all the value you would create within your brand experience is left by the wayside.”
The project is just getting started. “I don’t expect us ever to be done with it,” Mr. Trimm said. “It will be evolving as research and feedback and success of things we’ve tried, become clear. … It’s a new direction for the brand.”