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CYC Sales and Business Strategy

Executive Summary

Charge-Your-Car (CYC) innovative charging devices disrupt the market and promise a competitive advantage for the start-up. Nonetheless, the need for rapid revenue margin growth encourages the company to focus on the less traditional market of electric vehicle consumers. The core strategic proposal is to supply the rural regions with devices to stimulate the growth of e-cars share. Moreover, the market analysis indicates that rural residents become active e-cars owners so that they need charging devices due to the lack of adequate charging infrastructure.

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As a result, CYC can penetrate this niche segment and fulfill not only market demand but also its financial objectives. The further growth and development of the brand are aligned with advanced technologies regarding charging stations and chargers. The proposed innovations and strategic steps ensure that the company will secure its competitive advantage and ongoing competition with automobile brands (Gross-Fengels & Fromhold-Eisebith, 2018). In return, the analysis of consumers and prospective partners supports the idea that CYC may establish technological supremacy on the market if its R&D continues to explore and develop advanced conduits and materials.

Strategic Partnership

The current business model of CYC indicates that the company offers small contracts for private entities and households to charge their electro cars. In this case, CYC can focus on the promotion of its products not only in urban regions but also in rural areas. The established partnership with automobile manufacturers and the innovative infrastructure of the charging devices should stimulate the company’s growth and revenue margins (Daim, Wang, Cowan, & Shott, 2016). What is more, the utilization of European strategies and experience can be used to increase the efficiency and reliability of the developed strategy.

For instance, in Germany, the charging devices are distributed across urban and rural areas through the partnership with local authorities, development projects, and franchises. German suppliers and manufacturers pay attention to rural areas, as they are less explored and relatively undersupplied by technological companies (Thimm, 2017). Such a tendency decreases the popularity of the electric vehicles, so that automobile brands and engineering companies have allied and pursue the authorities to launch several projects for charging stations’ construction.

The identical situation is tracked on the U.S. market. Urban areas and metropolises have access to both electric vehicles and charging devices. The rural regions show demand for such products; however, they are limited in resources and infrastructure sustainability. CYC can use this as a competitive advantage and launch several projects to cover rural consumers. The sweet spot for such a start can be California, as the state authorities and citizens are the most proactive consumers in the e-car segment.

In this case, local laws and regulations will support the growth and success of CYC initiatives, making a substantial boost for the ongoing projects. Besides, the alignment of consumers from urban, suburban, and rural regions will give the company access to the broader audience. In return, the success of such initiatives will add value to both product and nation-wide marketing campaign.

Business Purchasers

The business purchasers for CYC charging technology should be found in local businesses. For the company, the best solution is to offer final products to the private entities apart from the automobile brands. Such a decision supports the competitive advantage, as CYC will supply, construct, and maintain charges alone, making most profits on the market. Another benefit for the company is that the local businesses are interested in the charging stations for their employees (Levinson & West, 2018).

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Most companies are now flexible towards electric vehicles and tend to create a comfortable and sustainable environment for their employees. In this case, the availability of charging stations or devices will support local companies’ intentions and assist them in making employees more satisfied. The reverse effect of such partnership is also beneficial, as people express demand for charging stations for them to use their electric vehicles.

From this perspective, it can be stated that the business partnership should be focused on the contracts and services regarding market demand. The collaboration with vehicle manufacturers is less feasible due to the intellectual property issues and risks of being merged or consumed by larger brands. The focus on local businesses and their needs in charging devices will assist CYC in acquiring contracts, market shares, and brand positioning on the U.S. market.

Consumer Purchasers

Based on an inventory within the company and other national projects in rural areas, a practical concept for charging infrastructure is to be developed. In addition to the averaging popularity of electro vehicles, the current status of the charging infrastructure in rural areas is raised. Based on the analysis of practice pioneers and representatives, a collection of requirements and wishes for practical charging infrastructure in rural areas was collected (Nicholas & Hall, 2018). These requirements do not necessarily conform to the findings of the known studies, especially if they were created in a theoretical environment.

However, a high level of practical relevance of the charging infrastructure is required to ensure acceptance of the electromobility. According to the business criteria, everyday users in rural are not popular among electro chargers’ suppliers due to their small number. The identified needs are, therefore based on criteria such as:

  • Everyday experience in rural regions;
  • Knowledge of technology and operating conditions of a wide variety of electric vehicles.

The consumer purchasers are private households and owners of small businesses who require electric chargers for everyday use. The market analysis indicates that the current automobile vehicles market offers cars for rural areas with the electric engine; however, they do not supply or maintain charging stations. In this case, the company can penetrate the rural markets and provide its products directly to private entities (Daim et al., 2016). On the contrary, the rural areas consumers show high awareness and desire to participate in the promotion of electro-vehicles. The company may consider such a message as an opportunity to expand sales strategies and introduce franchising to cover more regions and market shares.

Key Sales Propositions

The appearance of an electric gas station must be covered in local media, as well as through advertising on radio and social networks. Additional support can be obtained at the level of regional authorities, which are interested in infrastructure for environmentally friendly modes of transport. For example, the project “electric taxi,” which was held by Uber, received support at the level of government agencies, not without the help of which it was possible to open a gas station directly at the city station.

Guests of the city began to carry one of the first domestic mass electric vehicles. To sell small “chargers” to private traders, you can make an online drop-shipping shop (Gross-Fengels & Fromhold-Eisebith, 2018). To implement such a project, it is not necessary to immediately purchase expensive equipment. It is enough to establish contacts with suppliers and debug contextual advertising of google AdWords and social media platforms’ format.

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As practice shows, in the U.S., there is a steady demand for such devices from the owners of used electric vehicles, which only grows with time. Representatives of businesses who have the need for constant charging of their fleet’s cars can also become customers of electric gas stations. It can be both those environmentally friendly taxis mentioned earlier, and car-sharing providers, rental companies, municipal structures.

Competitive Threats

The competitive threat for CYC is the appearance of the charging stations and devices from automobile manufacturers. While the U.S. market has significantly expanded in the last five years, the current infrastructure to charge electro vehicles is less developed and reluctant in changes. The SWOT Analysis (see Appendices) indicates that the company can win the competition; however, it should re-invest funds in the R&D and product quality.

Such an urgency is based on the automobile manufacturers, which try to supply their cars with chargers and provide projects of the charging stations’ construction (Qin, Zhang, Yang, & Li, 2019). As a result, the further development of the segment will cause pressure on private companies, like CYC, as their product will compete with chargers made by automobile brands exclusively for their products.

Another threat is the fast-changing technological growth. While a couple of years ago, the charging stations were unique and brand-new phenomena, today, more and more companies offer their solutions not only in technology, but also in materials and conduits for chargers (Kieldsen, Thingvad, Martinenas, & Sørensen, 2016). In this instance, today’s CYC innovation can be outdated in the next year, which will apply costs and risks to the company’s strategy. Besides, the lack of any other product will squeeze the revenue margins and may force the company to leave the competition. On the contrary, CYC has an advantage, as it can cover rural areas and hold the leadership in this sector.

Product Innovations

It will be much faster to charge the electric car with the help of a three-phase outlet with a voltage of 380 (400) volts. However, to recharge from a three-phase outlet, a particular device is required that is connected to an electric vehicle and regulates the charging power. It’s even easier to charge an electric car if you have a Wallbox charging station installed at home (Liu et al., 2016). In principle, this is nothing more than a unique outlet for electric vehicles mounted on the wall. But with it, an electric car can be charged ten times faster. There are many manufacturers of such stations: from auto companies to electricity suppliers. Finding them for sale is not a problem.

You can also “refuel” an electric car with the help of charging points: for example, in Germany today, there are more than 16,000 such points, according to the industry association. About 12 percent of them allow fast charging of electric vehicles. Thus, there are about ten electric vehicles per charge point in Germany (Riegler, Vogler, Neumueller & Komendantova, 2017). This indicator was recommended by the European Commission. In addition to the existing at least 100,000 charging stations already in place throughout Germany, by 2020, such a plan is spelled out in the coalition agreement between the ruling parties of the CDU and the SPD.

However, this indicator is still far away: over the past two years, the German Ministry of Transport, although it permitted the construction of 16,000, has put into operation only about a thousand (Riegler et al., 2017). It’s a rather unpleasant situation when someone wants to “fill up” their electric car, and someone’s vehicle is already on public charging. And even worse, when it is already fully charged and should not take up space.

The solution could be automatic charging stations where electric cars would be charged with the help of robots. This is what researchers from the Technical University of Graz in Austria are working on. Other researchers are also working on the development of robots for recharging electric vehicles, for example, at the University of Chemnitz (Thimm, 2017). Volkswagen, in collaboration with robot manufacturer Kuka, also introduced a development a year ago, and Innogy, the energy supply company, launched a refueling robot in February this year.

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Company’s Priorities

The company’s priorities for the first year is to establish partnerships with authorities and prospective clients in both urban and rural regions. What is more, the first and second years for the company should be devoted to rural market penetration and expansion (Wood et al., 2017). In this case, the capital should be allocated in making a solid foothold in California and nearby states so that the consumer base can be developed. In this instance, CYC will ensure its success and rapid growth in sales and revenues.

Conclusion

The conducted analysis of the electro mobile industry and market in the U.S. indicates that CYC has prominent advantages and chances to lead the charging technology segment. In this case, the proposed strategic plan and steps support CYC’s growth and sustainability. The first two-year strategy assists CYC in penetrating the market and acquiring the consumer base among rural residents. Further innovations and industry expansion cover technological supremacy and intense competition with automobile manufacturers to outmatch their brand-related chargers and products.

References

Daim, T., Wang, X., Cowan, K., & Shott, T. (2016). Technology roadmap for smart electric vehicle-to-grid (V2G) of residential chargers. Journal of Innovation and Entrepreneurship, 5(1). Web.

Gross-Fengels, S., & Fromhold-Eisebith, M. (2018). Adapting transport related innovations to rural needs: Smart Mobility and the example of the Heinsberg region, Germany. Advances in Transport Policy and Planning, 125-162. Web.

Kieldsen, A., Thingvad, A., Martinenas, S., & Sørensen, T. M. (2016). Efficiency Test Method for Electric Vehicle Chargers. In Proceedings of EVS29 – International Battery, Hybrid and Fuel Cell Electric Vehicle Symposium.

Levinson, R., & West, T. (2018). Impact of public electric vehicle charging infrastructure. Transportation Research Part D: Transport and Environment, 64, 158-177. Web.

Liu, C., Deng, K., Li, C., Li, J., Li, Y., & Luo, J. (2016). The Optimal Distribution of Electric-Vehicle Chargers across a City. 2016 IEEE 16Th International Conference on Data Mining (ICDM), Barcelona, 261-270. Web.

Nicholas, M., & Hall, D. (2018). Lessons learned on early electric vehicle fast-charging deployments. Web.

Qin, Z., Zhang, W., Yang, P., & Li, Y. (2019). Research on Distribution Planning of Electric Vehicle Charging Station Based on Discrete Location Model. IOP Conference Series: Earth and Environmental Science, 252, 032164. Web.

Riegler, M., Vogler, C., Neumueller, S., & Komendantova, N. (2017). Engaging inhabitants into energy transition in climate and energy model (CEM) regions: case studies of Freistadt, Ebreichsdorf and Baden. CEM Research Collection.

Thimm, T. (2017). E-mobility as an innovation for a sustainable destination future. In Conference Proceedings of BEST EN Think Tank XVII: Innovation and Progress in Sustainable Tourism Townsville, Australia: James Cook University, 112-120.

Wood, E., Rames, C., Muratori, M., Srinivasa Raghavan, S., & Melaina, M. (2017). National Plug-In Electric Vehicle Infrastructure Analysis. Technical Report. Web.

Appendices

SWOT Analysis

Strength:
  • disruptive technology
  • advanced engineering solutions
  • value-added and unique product
  • compatibility of chargers with most e-car models
Weakness:
  • Short-run financial objectives
  • Lack of long-term vision
  • Limited resources
  • One product
Threat:
  • Intense pressure from rivalries
  • Car manufacturers chargers
  • Fast-changing and growing technological environment
Opportunity:
  • Company can cover rural regions
  • Generate consumer audience from households and SMEs
  • Development of the charging stations or infrastructure for their construction

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