I recently read an article about declining rental car usage and it was blamed on Uber. Like a lot of people, I use Uber often, even where I live, so the article did not surprise me. Thrifty has a plan to fix that and it’s smart.
Last weekend I went to Atlanta for a work trip. Having experienced really high rates from Hertz and Avis in the past, I have mostly used Thrifty in the last five years when I have needed to rent a car. Now I realize Hertz owns Thrifty, and in the same vein that Old Navy, Gap, and Banana Republic are owned by the same company, I get that there can be several brands and markets (low, medium, and high-end) within a given industry. VW is also part of the same company as Porsche and Audi, but that’s very different (VW doesn’t make any money – by design) and I will blog more about that some other time.
I will start by telling you what happened.
I went online, starting at Trivago and learned that wasn’t the right place to start even though I do love that site. Then I went straight to Thrifty. I entered my airline information and told them my pick up/drop off dates and it offered me a car for $50. At first I thought that was a daily rate – and then I realized that was the total price for a three-day rental. It was $13 per day plus taxes. I couldn’t believe it. And like most rental car companies, you can book a reservation without even entering a credit card (that’s bound to change soon), so there’s never a penalty for a no-show. So I booked it.
Then on Friday night I got to the rental car counter. The discussion started off pretty predictably with the woman behind the counter asking for a driver license and a credit card. Then she started explaining some of the insurance options. Now I have been told for over 20 years that you always decline insurance on a rental car, especially when it’s for work and you are paying with American Express, which I was. But today she was very convincing and I actually thought about it – she pointed out some specific coverages for accidents with people who don’t have coverage and I really thought about it. Part of my thinking was – well it’s only $13 a day, maybe another $25 for insurance isn’t such a bad idea. She told me their gas prices are really high and that if I was planning to drive a long distance (which is almost inevitable in Atlanta) it might make sense to pre-buy the tank. These are questions I never think twice about and always decline, but today, I was really thinking about it – because the way she asked the questions was different. And again – my base was $13 a day, so I kept thinking, what’s the harm. But in the end I said “no” to everything and went on my way.
As I was driving up North, it hit me what had just happened, and why Thrifty is so smart (I am guessing – I haven’t spoken with them about this).
They don’t want to fight the battle for your business online. They want to get you face-to-face for the real selling. So they completely undercut the competition online – $13 a day is nuts – and that’s probably a marketing expense for the people like me who make it to the counter and don’t bite. If I came that close to caving, I bet more than 50% of people buy some of the insurance, car seat, GPS, gas, or other add-ons, and by the time it’s over – they are right back at the $50 per day I have come to expect with a car rental. Paying $13 per customer is a high marketing cost in a vacuum, but if that’s what it takes to get someone to go all the way from Seattle to the Atlanta rental car counter – that’s smart money.
On the spectrum of smart, smarter, smartest, Thrifty gets my Smartest Company award for the month.
I will admit that I expected to pass a gas station on the way back to the airport and there wasn’t one, so I still got stung on the not filling up gas charge, but next time I will know better.
P.S. The punchline on VW is that they sell large volumes, which helps drive down the cost of their parts. Audi and Porsche use a lot of those parts and that’s why it makes sense for VW to operate at a black zero in terms of profit, and how Audi and Porsche are hugely profitable. And Thrifty doesn’t offer any of those cars.