1) Why would you approach Enterprise Rental Cars to have their Headquarters or a major Enterprise processing centre undertake such a collective commuting test? Why might such beta testers be particularly skilled and insightful in their advice and suggestions? Case 1: Segmenting and Targeting the Electric Car Market The North American electric car market is at the ferment stage of development

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1) Why would you approach Enterprise Rental Cars to have their Headquarters or a major Enterprise processing centre undertake such a collective commuting test? Why might such beta testers be particularly skilled and insightful in their advice and suggestions?

Case 1: Segmenting and Targeting the Electric Car Market The North American electric car market is at the ferment stage of development. Google “electric car” and you will get many start-ups with their design and plans to “make” the market. The big auto companies have their planned models and so do numerous venture capital start-ups. They all seem to be about 2-3 years away from launching their products. The problem is battery range and power. With today’s technology, a small, low cost mass produced eCar would have a range of about 80 miles on a charge and a top speed of 60 miles an hour. This is considered not good enough for the market that is used to gasoline cars with top speeds of 100+ and with a range of 300+ miles. The eCar has to get a lot better before it is viable. That is the conventional wisdom. It is wisdom not built on 3D segmentation. It reveals that the eCar makers’ innovation is not matched by their capability to think cleverly about segmenting the market on benefits sought and about how to win the diffusion of innovation race. Cars are used for many different purposes. Is there a profitable usage segment out there that would be happy with the current performance limits of today’s electric car? To think about this let us think about short-distance commuting. People commute downtown and back but public transportation is and will be a serious competitor to urban eCar commuting. People also commute to major suburban business campuses where several thousand employees from the same company work together. The majority are likely to live within 20 miles of their work. They want an electric car that can be taken on a street route to work and for short distances on highways and then used to go shopping or pick kids up, a second car that only needs a daily range of 80 miles. People also commute to Universities. The great majority of students live within 20miles of a campus. Many campuses have large car parks and universities also are centres of the Green movement.Why not offer the most robust and reliabe technology that is not cutting edge in range and speed and, hence, much less expensive, and wait for the technology to improve and come down in cost, and then upgrade range? Why not feature a car that goes 80 miles on a charge at a top speed of 60 mph? Design the batteries and charging unit as modules that can be replaced by more powerful modules down the road. Everyone else will be competing on speed and range. Be different. Understand better the commuting experience, rather than fret about extending speed and range. Provide the best positioned coffee mug and cosmetics holders to accommodate what people do when they are commuting. Provide a superb cell-phone-driven speaker phone system that enables you to listen to messages, and make calls from steering wheel controls. Provide the best sound system experience in a small car, by far. Provide the safest capsule seating design. Smallness and lightness means less safe and this must be countered by featuring safety. Provide the very simplest plug and charge system. No installed meters – meter is included in car and used to claim tax discounts that will be inevitable to promote pure eCar use. Provide a warning alarm if the cord is still attached when the car is started.You partner with a major Indian small car manufacturer such as Tata or Bajaj to take its people’s car frame and mechanics and convert it to electrical power ($5,000 at retail), make it super safe and add commuting delights ($1,500 at retail), give it super electronics and a super sound system ($1,500 at retail) and plan to sell it for $10,000 retail. Why? Because these low cost car companies will ultimately enter the American market with a very low price option anyway. You may as well be with them right from the beginning rather than face them as impossibly low priced imitators, in 5-10 years. The plan would be to bring the AmericaneCar version down to $6,000 - $8,000 in 5 years, and the World eCar version down to $3,000 in five years (see the Module 7 Case on pricing the eCar). But to really find out what features such a car needs you would test 100 such prototypes with a friendly headquarters of a company where managers are given the car free for three months. The onboard GPS computer tracks its use over three months. Inexpensively lease GPS devices to other managers to log their daily driving so they can learn what electric car range they need. The electronics also allow users to call up a number and describe what they like and do not like about the car. Each of the 100 prototypes might cost $30,000 to equip and run. One hundred investors are sought who will each own one of the original prototypes as security on their investment. They get all the private inside information from the field tests and first refusal rights on further investment ... exercising options. If the venture succeeds, the prototypes will become valuable collector cars that the original investors can keep or sell at a premium. If not, at least the investors have an electric car, something for their money. The acid test is how many of the original trialists want to continue to lease the eCar at the proposed market price? Technicians can check all the systems in the company car park using remote sensing of batteries, charging system, motors etc. The idea is to target a small market segment niche, service it superbly and own it, totally. But to do this you have to be very early in the market with a very low priced vehicle.