Platinum Motorcars: Market Segmentation and Repeat Purchases

Benny Black drove up to his Platinum Motorcars location to begin another day's work in his 1997 Mercury Sable with 198,000 miles on the odometer. He calls the car, which he purchased on craigslist, "Goldie." Benny doesn't believe in using his own money to buy and drive fancy cars.

At the same time, he wore a high-end black suit. As he explained, "I'm always going to be dressed to the nines. I always have the matching pocket square with the same color tie. I'm letting you know where my brand is. I'm not going to be cheap. You know that right from the get-go. You know it's going to be expensive, but you're going to get the value in what it is that you're trying to do."

Platinum Motorcars grew out of a unique entrepreneurial experience. Benny said, "I had two-years of experience in the limo business. I told the wife one day that I wanted to start a limo company. I always had the affinity for wanting to serve people of wealth, with means, because I thought, 'If you can serve the masses, great, but if you can find a niche, and just reach a certain type of clientele, I always thought the easy one would be people with money.' My motto has always been 'a rich man will always be rich.' That's the ones you want to try to get to."

He continued, "I had that (limo service) for 2 years. I had already built a clientele base, but I thought there was too much competition, because I wasn't using my own limousine. What I was doing was borrowing a limo from my friends, pay them for the limo, get paid for my time, and then just try to give that great service to the client.

"I had to figure out a different way. I could utilize the same clientele but in something that nobody else is doing. So that's where I had the idea that I needed to figure out how I can drive nice cars and not have to pay for them.

"My biggest catalyst for that was that I got a call from one of the larger hotels, and they had a ballplayer in town that wanted to be driven around in a limousine. I picked him, and while I was driving- I actually said to him, 'If you ever need a nice car while you're in Dallas, let me see what I can do for you.'

"And he said, 'Can you get me a Bentley tomorrow after the game?' This was in 2000.

"So, I said, 'Yeah, I think I can make that happen.' I just got on the phone with some of the clients I'd been servicing, I called one client in particular and I said, 'I need to borrow one of your Bentleys.'

"They said, 'What have you got going on?'

"I said, 'I've got an athlete that wants to rent one to drive tomorrow after the game.'

"He said, 'What will you give me?'

"I said, 'I'll give you a thousand.'

"He said, 'Give me a thousand and an autographed jersey, and it's yours.'"

Benny completed the deal, making a handsome profit.

From there, Black developed the business model that has expanded to include rental services for high-end luxury vehicles, chauffeur services, and sales/leasing arrangements. His exotic rental cars include Aston Martin, Bentley, Rolls Royce, Ferrari, and Lamborghini. Sports cars are also available, with Mercedes, BMW, Porsche, and Maserati vehicles for rent.

Renters must meet high standards, including a $1,000 hold on a credit card, a $250 nonrefundable reservation fee, proof of insurance, and a significant charge for cancellation. Drivers must be 25 years old for some cars and over 30 for others. Platinum Motorcars serves an impressive client list, including major sports stars, celebrities, local business leaders, and even foreign dignitaries and tourists. As Black puts it, "I became 'The Exotic Car Guy.' I'm the guy you call when you come into Dallas. My tagline is 'We provide the lifestyle you deserve.'"

Bennie noted that several similar auto rental businesses had come and gone in the Dallas area. His explanation was that the businesses catered to people who would drive a luxury car as a "once in a lifetime experience," such as for a prom, wedding, or some other major event. Instead, his company focuses on individuals who might desire a luxury driving experience on an ongoing (even if sporadic) basis. These customers, rather than buying a single car, are able to rent from a wide selection for various events during the course of the year, including simply taking a weekend to drive a luxury vehicle.

Through connections with a variety of people of wealth, including the "new" and the "old" rich, and effective combinations of the Internet, social media, word-of-mouth, and exciting events and offers, the future looks bright for Benny Black and Platinum Motorcars. Most recently, the company expanded to a second location using the same marketing and business model.

Questions

Total marks: 10 points

1. How is the market segmented by Platinum Motorcars? Justify your answer. (4 points)

1. Identify the positioning strategy of the Platinum Motorcars rental service. Justify your answer. (6 points)