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- [00:00]
Fergus
Well, I hope everybody's having a great summer. A couple of housekeeping notes before we get into today's episode. We are now on YouTube. We've been on there about two weeks. It's been brilliant. I love it. It's kind of weird seeing yourself on video because I've. This is the first time I've done it in four years, so be kind to me. But it's been brilliant too. We've seen a ton of great response. Please do go on there and subscribe. It'll help us a lot to get the word out about the show and video. It'll be terrific. So on Strategy, showcase on YouTube. Also some upcoming episodes. We have Instagram. We just recorded with Instagram this week. GoDaddy, Polaroid, Stella Artois, Neutrogena, Heineken Pub Succession, Ikea and Telstra, which is the telco out of Australia. That episode is going to be dropping next week. Love that. And we are going back on the road. We're going to be back on tour this fall. We're doing, I think 7 or 8C, which is brilliant. I loved doing it last year. I was super nervous about doing it the first time. We had always been a show that was based in Chicago and going out for sort of an introvert like myself was kind of not exactly the most appealing thing. But it was actually the show in Dublin. When we posted about the possibility of doing a show in Dublin, that forced me out of my Chicago base when there was such enthusiasm for doing it there. So thank, thank you for the Guinness Storehouse who offered up that space last year and really sort of forced us out of our shell as a show, which led to like, I think eight or nine shows internationally last last year. So we're back on tour this fall. We're going to be in New York City September 10th. It's going to be in the evening. It's a. It's a. I think it's a Wednesday. We're going to be at Mischief in their Brooklyn office. September 18th, we're in Dallas at TRG Octo, I believe roughly October 2nd, we're going to be in LA again at Anomaly. We are then going to be, I think in Dublin. I don't have a place yet, but we're going to be in Dublin in October. We're going to be there for the Effie Awards and then we're hoping to do a live show that same week, so we'll figure that out. And then in November we are back in London and we're going to be at Mother's office in London. And there's a few more dates. We're going to be back in Chicago for that, that fun holiday ad special. We're going to do that again and it's going to be a great show. That'll be, I think, December 4th, tons of fun doing that last year. So let's get back to today's episode. We're talking today with Matt Kerbal. He's global head of brand strategy for Turo. And Turo, for those not familiar, is a peer to peer car sharing service. It's a big business. It's been around for 15 years and they talk about it as the Airbnb of the car sharing category. There's a lot of brands in that, there's a lot of brands in rental, there's a few brands in car sharing and subscription of car services. It was great to have Matt on the show and we had a great discussion about the nuances of that brand. And when you go from early market to sort of early majority in terms of market penetration, what are the different dynamics at each stage and how do you begin to market to that? So this is my conversation with Matt Kerbal out of Turo. He's in San Francisco. En so for those who don't know Turo, what is Turo and whom does it compete against?
- [03:47]
Matt Kerbal
Yeah, so Turo, the easiest way for people to think about it is it's like Airbnb, but instead of vacation rental properties, it's cars. And so we have a vast community of car owners, which we call hosts, similarly. And they rent out their cars to people that need to rent cars, which we also call guests. But what we would say is, is it's so much more than just that kind of sort of gross simplification. You know, I mean, the, the comparison between who we competed, compete against, which are traditional rental car players, which in the US are, you know, Hertz and Enterprise and avis and National Budget 6. These types of companies, they can sort of be traded for one another. If you didn't show the logo, you wouldn't know who you're using. By the way, the youngest of those competitors started in the 1950s. You know, you have Hertz going back to 1918. You have sixth out of Europe going back to 1912. These are not modern innovators by any stretch.
- [04:55]
Fergus
In terms of a use occasion. If I arrive on a flight, I know there's a Hertz bus. I know I get on that bus. They take me to a Hertz lot. They do a pretty damn Good job of, for Gold members at least of getting you to the car. What is that, what is that experience like on Turo? Because am I dealing with Turo or am I dealing with the owner of the vehicle? Are they picking me up? Is there a lot? What's that experience like?
- [05:25]
Matt Kerbal
Yeah, no, it's a great question. There is no rental counter there. There is no need to have to deal with everything that comes with that, which varies from airport or airport, whether you have shuttles, whether you have lines, whether you have paperwork, all that kind of stuff. With us, it's all done in the app. And then you work directly with the host to figure out where to grab the car up. And in many situations, they will leave it in a airport parking lot, they'll tell you exactly what spot, and you will go to the car, you will check in through the app and you will have gotten the information from them as to how to enter the car, which again, very similar to Airbnb.
- [06:08]
Fergus
Right?
- [06:08]
Matt Kerbal
How do I get in this house? Is it a code, is it a key, etc. Then you get the heck out of there and you go and you've got pictures that document everything that you've taken in the app. And the host is taken as well, just so that you both have, you know, proof of kind of how everything started. Mileage, gas tank, et cetera. But that's it.
- [06:26]
Fergus
Let's talk about use occasions, because I gotta assume, I mean, you guys are a billion, billion dollar brand, Billion dollar revenue, annual revenue, close to a billion dollars in 2024.
- [06:38]
Matt Kerbal
That's right.
- [06:38]
Fergus
So you're not a startup.
- [06:40]
Matt Kerbal
Nope.
- [06:41]
Fergus
I haven't been aware of Turo. Right. It just hasn't been on my radar. And tell me. So it's my. Hey, my bad. Or maybe it's your back because you haven't reached me, but it's interesting about that growth. So it's gone from zero to a billion. Amongst which use occasions and amongst which audiences.
- [07:05]
Matt Kerbal
Yeah, we actually started back around 2010 by Shelby Clark. It was a company called Relay Rides and actually it was short term rentals. So it was more like, like, like get around, I guess you could say. And it was really just about, you know, like, oh, I, I need to run an errand, I need a car, I don't have a car, you know, and, and man, it would be so convenient if I could just grab that car that I see on the street that's sitting there and go and do that thing, you know, come around 2014, they decide to rebrand as Turo. And that is when things switch to being a daily rental marketplace and not just an hourly, which, you know, completely changed everything, because then it was really about opening up people's eyes to using Turo for travel and for weekend getaways and things like that. But to your question about use cases, this is where I think it's really remarkable, because we have, give or take 350,000 cars in our marketplace globally. We're in five countries, we have about, give or take, 200,000 hosts. If you're considering a new car, you can use Turo for an extended test drive. If you have a special occasion, you want to show up in a certain way, or you want to make it more special, you can use Turo. You want to just find a car you've always wanted to drive and go and drive it and have some fun. You can use Turo, of course, you can use Turo for all of the things that you can use traditional rental car companies for, whether it's travel, whether it's business trips, whether it's, I need a replacement car, et cetera. But the ability to choose the exact car that you want and the unbelievable character of our marketplace and the vastness of it allows you to use Turo for so many more reasons. I've been at the company now for three years. I came in the midst of the pandemic, and the pandemic was a formative time for the company, Turo 3x in growth during that time. And it's the confluence of two things that are happening. On one hand, you have people that are caged animals learn that it's good to be outside, right? You want to go and do something. You want to go somewhere, you want to have some sort of experience, some sort of adventure. And road trips were kind of the way because you couldn't fly. And so on one hand, there's that, and that is compounded by the car rental crunch, where you couldn't get a car from these companies. And if you could, it was wildly expensive. And so people also just had normal needs for car rentals as well. And then on the other side are everyone who's working from home whose cars are already normally sitting there for 90 to 95% of the time. Now it's 99. And there's an opportunity to have people use their cars and make passive income. And so the flywheel just went into sort of hyperspeed. The challenge for us moving forward is beyond what you said earlier, which is. Is. Is we're in that early majority territory. You know, we've we've really appealed to and converted in many cases a lot of these innovators and earliest adopters if you think about kind of that traditional innovation curve. And now we have people that are certainly intrigued and may even consider us, may investigate us, but for us to actually get them over the hump to conversion, we have to earn their trust. They have questions.
- [10:41]
Fergus
We'll be right back. So I'm joined by Matthew Herbert, he's co founder of Tracksuit, the affordable brand tracking solution that we love here on the show. I wanted to talk to you Matt, a little bit about Turo. So we're talking here with Matthew Kerbal and it's a really interesting category. There's some other big brands that have gone before it. It's been around for 15 years and it's a billion dollar brand. And but it's still, as Matthew in the show is saying, it still struggles with that mid funnel challenge. And I'm wondering what does the Tracksuit data tell us about the situation for Turo?
- [11:20]
Matthew Herbert
We're looking at Turo and they have a classic challenge, a brand in an established category. They've got about a 28% awareness. They convert people through the funnel really well but just not enough people know about them. When you compare them to an enterprise or a Hertz or an Avis who are all got awareness in the high 70s and 80s. When we look at Tracksuit we can compare our compare brands against the category.
- [11:43]
Matt Kerbal
Right.
- [11:43]
Matthew Herbert
And so we're doing a bunch of work with Matt and the and the team over at Turo and there is a really positive around where is Turo over indexing. So if you consider Turo, who's considering or preferring Turo right now, heavily over indexing in that 18 to 44 year old demographic, over indexing in high income households, over indexing with families or school age kids.
- [12:09]
Fergus
Affluent families.
- [12:10]
Matthew Herbert
Right, affluent families. A lot of younger demographics know about Turo but I'll challenge to say do they have the income when they're facing up against budget, budget alternatives. And so it's just really squeezing down into this super niche around where they are winning. But it's such a tiny part of the market.
- [12:31]
Fergus
And so what's job one for them?
- [12:33]
Matthew Herbert
Job one is more people need to be aware of them but then as people become aware of them it's driving that consideration. And what drives consideration in this category? Trust, reliability and safety. And that's where they've got a job to do with their communication.
- [12:49]
Fergus
Thanks, Matt. Let's get back to our conversation On Turo. Now, back to the show. We had Uber on the other week. We were talking about Uber Eats. And so they never advertised. They never advertised Uber as Uber rideshare. Never advertised. And they had what seemed like insurmountable hurdles to overcome with that early majority market. Those people who saw a lot of other people doing it, how do you deal with that? I mean, you. You've got to get through to this new majority, this. This early majority, which is where the mass of the market will be. Although you're already a billion in revenue, so I'm like, you're already in it.
- [13:25]
Matt Kerbal
No, we're still early. We're still early. Yeah, absolutely.
- [13:29]
Fergus
Yeah.
- [13:29]
Matt Kerbal
I mean, if you.
- [13:30]
Fergus
How do you address that?
- [13:31]
Matt Kerbal
Yeah, well, a couple things I'll say, because I was. Like I said, I was at Lyft pretty early. That was such a different time. You know, that was growth at all costs. And so the ability to throw just an insane amount of money at promotions to get people into cars, you know, and it happened so fast, and it was so easy. You know, I think the thing about Turo, which is different for sure than some of these other marketplaces, and that's why I think we're more akin to Airbnb, is that this is a lower frequency, higher dollaring, relatively, of course, decision, and it's something that you're going to take more time to investigate. Obviously, back then, getting into a car with a stranger was something that was new and different. But if you know that you need to get somewhere, you know, from point A to point B, and it's going to cost you $30 in a cab and take you half an hour. It's going to cost you $10 in an Uber or a Lyft, and it's going to take you, you know, 12 minutes. It became a pretty kind of compelling value proposition. And, you know, compound that with the ease of just doing it in the app and seeing how close the person is and all of the amazing features that. That came so very, very different time. I would argue that they advertised a ton, and in general, they marketed a ton. Right? Like, whether it was actual campaigns or, of course, everything they did from a content standpoint, a partnership standpoint, you know, partnerships with anyone they could partner with. I remember when I was at Lyft, we stole the USC partnership from them that they had with the University of Southern California. So it was a battle. To answer your question, today, for us, the game has changed. And I think it's. It's about a couple things. One, you know, you have the, the creator economy. You have all of these incredible sort of social circles beyond just traditional social media, where, where conversation is happening. Of course, we have, you know, online travel aggregators. And so even, even Uber, who, you know, was our enemy, now our friend, we are. You can find Turo on Uber Rent. Right. So we're in their marketplace as well, and we have partnerships with other OTAs as well, like Kayak.
- [15:50]
Fergus
So I've noticed, I've noticed when you look at Uber, you look at Airbnb. When you look at you guys, you have strategically picked a villain. Like for Uber, it was taxis. For Airbnb, it was the generic experience of a hotel, the inflexibility of hotel locations, etc. For you guys, you've picked a villain. Can you tell us about that villain and why the villain?
- [16:24]
Matt Kerbal
Well, it's a good question. And if I'm being completely transparent, we're.
- [16:29]
Fergus
Always working, which is what we expect.
- [16:30]
Matt Kerbal
Yeah, we're always, we're all.
- [16:32]
Fergus
Well, we're all.
- [16:32]
Matt Kerbal
We're always refining that. You know, I think for us, where we're at right now is.
- [16:41]
Fergus
People.
- [16:42]
Matt Kerbal
People want to feel one, valued and two, in control. And, you know, to your point, even having a Hertz Gold experience and being with your better half and crossing your fingers and toes and hoping that you get something, you know, is like a. It's, it's. It's like waiting for a present at Christmas and not knowing what you're going to get. Like, that can be exciting, but at the same time, it can also be disappointing.
- [17:07]
Fergus
Most of the time it's disappointing.
- [17:09]
Matt Kerbal
Yeah. Whereas, like, when our kids ask us for something and then we get them, that, that's like everybody wins every time with a hotel.
- [17:17]
Fergus
Right. It's like when you walk into the hotel, your first thing, you're walking down the hallway, you're hoping the room is a good room. Right. Because you haven't picked it. You only know the room number.
- [17:29]
Matt Kerbal
Yeah. And here's what I'll say. I think this is a poignant thing that we've thought about a lot, is people may call us, or even sometimes we may describe ourselves as the Airbnb of cars just for posterity. Because it's easy, it's understandable.
- [17:47]
Fergus
Yeah. But what.
- [17:48]
Matt Kerbal
But when I really think about where we're at, maturity wise, you know, I, I think about just thinking about Chime going public recently. Right. Chime has been successful by helping people realize that there is a better alternative than bank of America or Wells Fargo, these very old, very antiquated establishments. That, you know, you have to deal with their fees. You, you know, may not get your paycheck kind of on time. You, of course, have to go and wait in lines and talk to people behind, like, bulletproof glass. And. And, you know, it's. It's very cold. And I think that we feel like sometimes the traditional car rental experience can also feel very cold and very frustrating.
- [18:36]
Fergus
The villain that I'm thinking of is the long lines at waiting counters. That seems to be the message that you're communicating now through your advertising.
- [18:45]
Matt Kerbal
Sure. It is a sort of representation of it. You know, I think the reason why I hesitated to answer the question directly at first is because I would say we have a bigger fish to fry than just the rental car counter. It's a great representation of our guests having control and feeling valued and doing so in a modern way on their terms. That is such a great, you know, representation for Turo. But I think as we think bigger, we're. We're thinking about that villain, what we call that monster as, you know, what. What is the. What is the kind of pain behind the pain, the source of it all? And how can we really, you know, help in a. In a bigger way? And, and, you know, I go back to those lift days where it wasn't just about, you know, being better than taxis. It was about creating community. That. That was people helping people, you know, and. And that could manifest as getting people to John job interviews, getting people to polls, you know, creating, Creating. I remember a product for, you know, women such that they could choose women drivers only so that they could feel more comfortable in the cars they got into. So there's so many layers, nuances that go into that. When you have a really wonderful, well established brand platform, do you think of.
- [20:12]
Fergus
Your marketing challenges being an issue of upper funnel or mid funnel? Because, you know, we've thought. We've talked to Tracksuit about. About you guys, and they think of it as being upper funnel, and I think you feel it's more mid funnel. Tell us about that.
- [20:27]
Matt Kerbal
Yeah, yeah. No, I mean, it's. There's opportunity for both, for sure. First of all, Tracksuit's been an amazing partner. Absolutely love what they're doing and grateful to be a client of theirs. And, and they're an important part of what we're doing because they help us to. To see these opportunities. Look, there's no doubt that from an upper funnel standpoint, we have massive upside. You know, I mean, like I said, Airbnb is 90% awareness, and the majority of. Of this country and certainly the others that we're in of. People don't know us. They don't. There's so many people that, that don't know us. And that's, that's, that's an, that's a massive opportunity to make a remarkable first impression. But then I think there's also the conversion of the people who do know us. And there's, you know, there's a risk premium for companies like Turo, like Chime, you know, as. As well, who are up against, for better or worse, very, very known commodities. Right. It's on us to help people understand. One, we are not new or small. Two, we have an incredible infrastructure. Three, we have, you know, countless people who have, who, who do and have and will continue to use Turo and, And, you know, have. Have remarkable much, much better and more preferred experiences with us. And somebody said something recently which I love, which is, you know, you can't just jump from the first date to marriage. There is a messy middle, and we need to crush the messy middle for, for everyone. We need to make them realize whether you are an individual going for a business trip, a family going on vacation, whether you are, you know, want to go on a road trip in a cool car, you want to test drive an EV or whatever. Like, we need to make it extremely apparent that we are the right, you know, and most convenient choice.
- [22:22]
Fergus
I guess how Airbnb did it, because when they started out, it was. It was renting a room. And so the ick factor was, who am I going to be? Whose home am I going to be in that may. And so that in a vacuum that makes you lean on the rational, the fear, the anxiety, the what if, the risk, if you face the same thing, the way to do it is to create more of an emotional connection to the brand, just in the same way airbnb did. But Skip, the rental counter is starting me off from a point of frustration. It's the villain. Right. Which I get. Right. It's a different emotion than taking me in a different place. That's more hopeful. Yeah. The joy of it all.
- [23:04]
Matt Kerbal
Yeah.
- [23:04]
Fergus
Rather than the avoidance of tension.
- [23:07]
Matt Kerbal
For sure. For sure. And we need to help people. You know, we're at a point now where we have to straddle the sort of pragmatic with the emotional because, again, we're still early enough that we have to help people understand what problem are we actually solving for them. The value that people have on their time is so important. And so we really want to communicate to people that, you know, we get that. Right. You need a. You need a 2025 solution, not a 1995 solution. Right. Is what I like to say.
- [23:38]
Fergus
You know, so well, it's a fun category. Sixth is also in that space with you. They're in the more they focus on the premium vehicle segment. Thank you, Matt. Kerbal is global, had a brand strategy for Turo in San Francisco. Thank you, Matt. I appreciate your time.
- [23:54]
Matt Kerbal
Thank you so much, Fergus. And for anybody that's curious about this, go download the Turo app, check it out.
- [24:01]
Fergus
Yeah. It's a fun thing to do. Thank you, Matt. And we will see everybody on the next episode.