Case study in planning and driving a stepchange in growth
Customer membership programmes are an important part of the operations of Hertz Europe in car rental, covering over 40 markets but with most customer members living in the major European markets. Members accounted for over 25% of all revenues, from one in 10 of all Hertz customers actually buying products.
The rate of growth in membership was established at net growth of +2% to +3% year on year. To change the role of the membership programmes for the business for the long term, a stepchange in membership growth would be needed.
In markets outside Europe such as the United States, the role of membership programmes was up to six times larger in scale and in proportion of revenues. This provided a proven model for driving growth in membership in Europe.
The growth plan started with understanding the channels for finding new members outside Europe. The mix was focussed around three main channels – new members found through major corporate accounts, through promotions with partners and thirdly through customers qualifying for upgrade from one membership tier to another.
Armed with this understanding we focussed our efforts around building three action plans for the three channels, carefully measured and performance managed against prior year results. We carefully crafted growth targets by channel, then negotiated buy-in with each channel owner together with an agreement for regular performance reviews.
The big difference
Within six months the three part growth engine was working well and starting to deliver. By the end of year one new member acquisition had increased +20% versus prior year. By year 2 growth increased again to a further +80% year on year. Cumulatively the membership base grew to it’s largest on record, delivering a true stepchange in growth.
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