Three Things To Understand About Your Market
"Without data, you're just another person with an opinion." - W. Edwards Deming
Without market research, any business, every business, opens their doors on day one with a handicap and an exponentially higher risk of failure. Successful businesses that go the distance knew this before day one and likely spent thousands, or tens of thousands of dollars understanding their market long before hanging the “open for business” sign.
If you’re a new or aspiring Turo host, you’re not immune from this necessity. You’re also not immune from the near certainty of failure that will follow entering the wrong market with the wrong vehicles acquired and managed the wrong way. In this article I’m going to share with you three things you must take the time to learn and understand before listing your first Turo vehicle.
The Overall Health Of Your Market
How much do you really know about your city, general rental car demand, and your likelihood of success? There are thousands of cities across the United States. Some cities have zero Turo inventory. Some have massive Turo inventories. Most are somewhere in-between. Some cities are healthy, vibrant, and could easily welcome more hosts and vehicles. Some are saturated with more vehicles sitting than rolling many months out of the year. Again, most are somewhere in-between.
Before launching your Turo business you need to understand which of those statements apply to your city. Here are four steps:
Find out the population of your city.
Find out the tourist pattern of your city.
Count the number of traditional rental car companies in your city.
Visit the Turo Market Health Map and see what the Carshare Academy has already discovered for you about the performance of the Turo inventory already there.
Demand Trend of Your City
Did you know that a Toyota Camry is NOT the best car to buy for every market across the country? Did you know that there are actually markets out there where a Jeep Wrangler will not perform well? Did you know that in some cities the demand is entirely for economy daily drivers and luxury cars will fail? Did you know that in some cities you’re going to be most successful with luxury, performance, and exotic vehicles? Do you realize that there are some cities out there where a pickup truck is going to be your best bet? I’ll bet you didn’t know that there are cities where you’re going to be far more successful with a Subaru Outback than a Toyota RAV4.
Every city has a unique demand trend. There are similarities between cities in certain regions, but even within those regions a model working well in one city isn’t the best choice in a city 20 miles away. And learning the demand trend in your city isn’t as easy as just scrolling through the app and seeing which models are most voluminous in your city. To be successful, you need to understand which models enjoy the strongest utilization across a twelve-month cycle, not just which models fill the search rankings.
The Carshare Academy has done all of this work for you in 85 cities and counting, with 5 to 10 new cities added each week. By the time you get to the last page, you’ll know exactly which models are going to perform best in your market with the least saturation resistance. You can visit our libraries here, and if you don’t see your city, click the button where it says “don’t see your city” and order a custom one for us to begin working on for you.
The Twelve-Month Cycle
Every year, around the beginning of August, new hosts all across the country begin to panic. Every May new hosts across Southern Florida begin to feel like they’ve made a terrible mistake. When October rolls around every year, the party is over in Anchorage until next May. In Detroit, every January and February Turo vehicles sit in their lots and driveways covered with snow instead of being out with guests.
Your city has a demand pattern that you need to learn and understand. Not only so you can save yourself the panic during the annual downturns, feeling like the world is ending. And not only so you understand that the peak season is just that, a peak, that isn’t going to last forever and will turn into a valley. But also so you can plan your business cycle to match your market’s demand cycle. You need to know what time of year is the best time to add to your inventory, and when is the best time to retire some vehicles. You need to know how to maximize profits and bank cash during the peak to get you through the slow times when you may not be able to cover your payment with Turo income, or the lack thereof.
You’ll learn this with time and experience, but if you’re just getting started you need to connect with and learn from experienced hosts in your city about how demand will rise and fall throughout the year. And, you need to follow the trend week to week with the Carshare Academy Market Pulse.
You can win if you’ll take the time to learn.
Running a Turo business isn’t difficult. Anyone can acquire vehicles, prep them for guests, take pictures, process reimbursements and claims, and do it over and over again. But still, a lot will and do fail every year. And a large percentage of those who fail, do so because they skipped one of the most important things they should have done in the very beginning, and that’s the gathering of market intelligence to guide their decisions.