The U-Haul brand could use a U-turn
How can U-Haul turn its brand around? This venerable company seems unaware that its ubiquitous brand is now bouncing toward the edge of a cliff, primed for a free-fall, with no brand programs to reverse its course. The brand just got a kick in the wrong direction from news articles linking management practices to horrific customer accidents.
Grim details that a brand doesn’t need
Last week The Los Angeles Times published a multi-part investigative series on accidents involving U-Haul customers and their rented trucks and trailers. The series focuses on U-Haul safety defects and deficiencies, and was picked up by other news outlets around the country. It documents grim details from court cases filed by injured U-Haul customers against the company.
From the Times:
U-Haul, the nation’s largest provider of rental trailers, says it is “highly conservative” about safety. But a yearlong Times investigation, which included more than 200 interviews and a review of thousands of pages of court records, police reports, consumer complaints and other documents, found that company practices have heightened the risk of towing accidents.
[…] During a yearlong investigation, Times journalists surveyed more than 200 U-Haul trucks and trailers in California and other states and found that more than half were overdue for a company-mandated “safety certification,” a check of brakes, tires and other parts typically required every 30 days.
Some safety checks were more than a year overdue.
Signs of a classic brand breakdown
The Times articles detail a case of classic brand breakdown. The signs are everywhere, writ large in customer dissatisfaction, chronic equipment troubles, problems not fixed, danger signals ignored, and a U-Haul attitude that makes customer service a low priority in practice. The brand seems notorious for bad service. (More on this below.) There’s just no evidence of proactive brand programs at U-Haul which might have mitigated on-road accidents and their high customer cost. These didn’t have to be flashy programs, or expensive ones, just focused measures to join with customers to make the rental experience safe and enjoyable.
In place of that “joining,” U-Haul’s customer interactions seemed to pivot on perfunctory warning placards and safety brochures (the latter not always distributed) and the legal language of its rental contract. These provide a very different brand relationship.
What the Times says about U-Haul and trailer safety
From the Times article:
The safest way to tow is with a vehicle that weighs much more than the trailer. A leading trailer expert and U-Haul consultant has likened this principle to “motherhood and apple pie.”
Yet U-Haul allows customers to pull trailers as heavy as or heavier than their own vehicles.
It often allows trailers to stay on the road for months without a thorough safety inspection, in violation of its own policies.
Bad brakes have been a recurring problem with its large trailers. The one Sternberg rented lacked working brakes.
Its small and midsize trailers have no brakes at all, a policy that conflicts with the laws of at least 14 states.
It relaxed a key safety rule as it pushed to increase rentals of one type of trailer, used to haul vehicles, and then failed to enforce even the weakened standard. Customers were killed or maimed in ensuing crashes that might have been avoided.
Similar concerns regarding U-Haul’s safety and maintenance practices have been raised in Canada, where U-Haul vehicles fared poorly in government inspections and independent safety checks.
U-Haul’s defense
Safety and maintenance are critical factors at a company with 100,000 trucks and 78,000 trailers spread across 15,000 locations. U-Haul officials have defended the company’s safety practices publicly, and in the courts. Its president has issued a response to the LA Times articles, citing progress in upgrading customer service. Some measures, like “U-Haul U,” seem promising in concept, but could have been started years ago. (And strangely, the president’s response seems directed at U-Haul managers rather than to the public or to U-Haul customers. One gets the feeling of a closed system struggling against an “outside” world.)
Troubles with brand experience, too
U-Haul’s brand problems extend beyond safety issues to the brand experience of U-Haul customers. The news reports cited above allude to widespread customer service problems, and a Google search on “U-Haul complaints” turns up many customers upset/frustrated with the U-Haul brand experience. Epinions has 500+ first person reviews from U-Haul renters. The site rates U-Haul with a score of less than two stars out of five. Here are three comments that might get a brand manager’s attention:
1. U-Haul is easily one of the worst services I have ever used. Personally I would not recommend them, however many of us have no choice when the big move beckons. My personal experience with U-haul was nothing short of disappointing . . ..
2. It doesn’t seem right that I am forced to give U-Haul even one star in creating this review. Let’s just say that if Epinions gave us the option to rate a product with no stars, this would have been it.
3. I have had several experiences with U-Haul. Each time I figured they were just having a bad day or something. I have now come to the conclusion that they never have a good day.
Let’s start with a long distance rental. I live in Georgia. …
U-Haul’s brand challenge
Admittedly, U-Haul faces a difficult brand challenge: how to build a consistent, positive (and safe) brand experience through 15,000 dispersed and diverse independent dealers across the US and Canada. U-Haul locations are part of the challenge, as they include storage sites, mini-marts, postal supply shops, even liquor stores and laundromats. The Times reports that employee turnover is high.
U-Haul seems to have followed a market share approach in expanding its number of locations for competitive advantage. It dominates the self-service rental market by its ubiquity. (That’s where the laundromats and liquor stores come in.) The U-Haul “brand” has been painted on vehicles, and is recognizable everywhere. But that’s pretty much as far as it goes. It does little to include customers.
One can only imagine the difference in the U-Haul brand experience if executives from Starbucks or McDonald’s were in charge. We’d all be motivated to move.
What U-Haul might do
For a company in U-Haul’s immediate situation, where the brand damage has been substantial, if not catastrophic, the first order of business would be a program of brand triage to stanch the bleeding, followed by a complete brand overhaul with the power to reshape operations. The current operational scheme is brand averse.
Will U-Haul do this? Their stock is holding at $70+, so they may simply stay the course, and let the brand take care of itself. The business driver (as they see it) is their locations, not what the brand does.
As a half-measure, they might try to delegate the brand to the dealerships by developing safety, maintenance operations and service standards, and making dealers responsible for implementation. Unless this is driven from the top as a “mission from God” it’s doubtful if it would amount to much in turning around brand experience at the customer level.
For competitors, a brand opportunity
Of course, one company’s brand problems are another company’s opportunity. While U-Haul can protect its assets via contracts and lawyers, it can only protect its brand with customers. Unfortunately, its hold on customers is weak. A disruptive competitor probably wouldn’t want to build out 15,000 dispersed locations in imitation of U-Haul. Better to follow a blue ocean strategy and recast the moving process from a customer perspective, based on customer priorities. That just might make U-Haul’s thousands of trucks and trailers and locations “irrelevant.”
Invite customers to help build the brand
One thing a competitor would do is to invite customers to help build the brand. This is precisely where U-Haul is vulnerable. For the competitor, simply provide an engaging brand experience that goes beyond the rental counter, vehicles and a contract. Dealer locations can be spartan, but make customer experience rich, with a process that’s personal and friendly, with information customers need, tips and tools they can use to make moving easier, a way to thank customers for feedback, and a way to integrate feedback into operations. Use the brand as a collaborative means to improve operations, and as a platform to offer more services customers might need, e.g., storage.
A design solution
U-Haul’s current problems cry out for a design team to reintegrate its customer facing processes and to pack more user friendliness and efficiency into the functionality of rental equipment. That seems a reach for U-Haul, but may not be for a competitor. It would be interesting to see how IDEO might redesign the U-Haul trailer to make it easier to load properly, and easier to tow. Why not come up with something better than an antiquated “trailer” concept to do the job? Right now U-Haul force fits its customers to an aged process. That’s a drag competitors can avoid.
An information solution
A bold competitor might break the conventional truck/trailer rental mold and put it back together as a business that fits today’s digital customer, perhaps designed for upscale service markets in major urban centers, using a top-flight digital infrastructure. Instead of a business that’s 99% hardware and 1% information, the new business may be far more profitable as a brand of information that uses wheels and containers to move and manage stuff.
Photo: bear69design — Flickr