Managing New Asia

3. Assuming Olympic Responds To Enterprise, How Should It Do So? What Is The Potential Impact Of Emphasizing Dollars Spent Versus Days Of Rental? What Is The Potential Impact Of Removing Blackout Dates?

4. What Is The Cost Of Matching Enterprise? How Much Should Olympic Be Willing To Spend For Its Medalist Program? 


5. What Is the ‘‘Economic Value of A Medalist Member’’ To Olympic?

In 2012 10% of Olympic customers were members of Olympic medalist program and these customers provided 21% of the revenues. They paid for 3.996.000 days and claimed 375.000 free days.

This means $323.400.000 of revenue come from members of Olympic medalist program, to this revenue we have to subtract the fixed costs, the free days cost and the program advertising costs ($28.000.000).

The fixed cost is 20% of $21 ($4,2) multiplied by the total rental days and equal $1.575.000 and the free days cost is equal to $7.629.552. This gives an economic value of $233 per Olympic medalist program customer.

The regular customers represent 79% of revenues that translate into $1.216.600.000. The total rental days for these customers are 24.681.000 and these days represent a cost of $103.660.200 (24.681.000 x $4,2).

There are also the advertising costs of ($108.000.000 – $28.000.000 = $80.000.000).

Subtracting to $1.216.600.000 the variable costs and the advertising costs we end with $1.032.939.800. Dividing this value by the total number of regular customers (11.052.000) the economic value of the regular customer is obtained and equals to $93. The conclusion is that loyalty program clients still have a big economic influence in the revenue structure.

6. How Does The Use Of Third-Party Consolidators And Online Price Comparisons And Bookings Impact The Car Rental Industry? What Effect Do (Will) These Web Companies Have On Loyalty Programs?

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