Flexperience

Flexperience offers a new and fully digitalized mobile option for customers, by giving them the ability to flexibly rent and use up to twelve vehicles per year according to their requirements (Daimler Global Media Site). They can customize their rental vehicles with selection of the engine line-up, color and interior appointments (Daimler Global Media Site). They can even upgrade to a higher-tier vehicle, track their rental history and their current vehicles’ data such as tank fill level and mileage through the mobile phone application, which makes it more convenient and less costly for them to drive to anywhere for any purposes (Daimler Global Media Site).

Flexperience was developed and implemented by the incubator Lab 1886, Daimler AG's and Daimler Financial Services’ innovation workshop, which aims at getting ideas of individual employees, teams and business units quickly, by allowing employees to work in shallow hierarchies and a creative atmosphere (Daimler Global Media Site). Therefore, it consistently encourages innovation and inspiration, and strengthens the ground of Flexperience development. It has been proved through Flexperience that the company definitely sees innovating new products and new business models within the shortest time possible as a priority in formulating organizational goals and strategies, because it has the ability to do so (Daimler Global Media Site).

What’s more, the enhancing market for autonomous vehicles gives Flexperience potential in future growth if it could incorporate autonomous vehicles into the subscription pool and therefore optimize overall utilization. Large dealers providing “service loaners” that are not 100% in use could also help improve utilization of un-used and under-used vehicles and hence improve the efficiency of the model.

In addition, the shifting trend in Millennials’ purchasing habit also supports Flexperience and the company to position itself for the future. Millennials are approaching their middle ages and as a result getting more willing to subscribe for vehicles rather than to purchase them. They are no longer eager to have their own cars as they previously were, because they do not want so much long-term commitment. Instead of that they prefer things that are flexible and easy to adjust to fit with their demand. Also many of them hate interacting with car dealers by whom they always feel being taken advantage of and forced to have uncomfortable purchase experience. Subscription models such as Flexperience would obviously reduce such kind of negative feelings for them because it offers flexible options that they can control.

There are a few competitors that might pose threats to Flexperience. They have different characteristics and appeal to different types of customers, so it is important for Flexperience to understand their strengths and weaknesses in varied market segments and be prepared to compete.

OEM competitors are very similar with Flexperience in the way how they operate. Customers pay monthly fees to them in order to get access to variety of models in their lineups, as well as coverage in insurance, maintenance and roadside assistance (Road Show by Cnet). One of them would be Access by BMW, which is a pilot program based in Nashville, and has two-tiered affairs priced from $2000 to $3700 per month. It is an expensive high-end subscription attractive to higher-income class customers (Road Show by Cnet). Another competitor would be Care by Volvo, which costs $600 to $700 per month, provides excess wear and use protection, road hazard plan, service and maintenance plan with costs being covered by the monthly fee, but it only enables customers to swap cars every 12 months (Road Show by Cnet). Also, Book by Cadillac, one of the first OEMs in the country, costs $500 of enrollment fee and $1800 of monthly fee, allows customers to swap cars up to 18 times per year, and offers some other advantages as well such as the spouses of accepted members can also legally drive the cars, the concierge service, but its deductible insurance is only $1000 (Road Show by Cnet).