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Exclusive: Mercedes beats rivals for sales satisfaction
JD Power SSI study of luxury brands ranks Mercedes well ahead of Audi, BMW
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10 Oct 2017
By TERRY MARTIN
MERCEDES-BENZ has emerged as the top-performing prestige automotive brand in Australia for sales satisfaction among new-vehicle buyers, placing ahead of Audi and BMW in the JD Power Australia Sales Satisfaction Index (SSI) study for luxury marques released today.
The result comes two weeks after Hyundai was awarded top honours among the mass-market car companies in the independent and internationally recognised SSI study, which is now in its second year but for the first time has split the mainstream and luxury brands into two distinct reports.
The study is a significant indicator of how well customers are being treated at the leading marques’ prestige dealerships in Australia at the time of purchase – and whether they are likely to become (or remain) advocates of the brand as a result of the experience – at a time when they are all managing a significant increase in showroom traffic, first-time and increasingly younger buyers and, up until this year, unprecedented sales volume.
Mercedes was not included in the inaugural 2016 SSI report due to an insufficient sample size but JD Power executives have revealed to GoAuto that its 849 points in this year’s study – calculated on a 1000-point scale and based on six factors: salesperson, ‘the deal’, delivery timing, delivery process, dealer facility and sales initiation – marks a continuation of its standout performance in this field.
Indeed, Mercedes would have ranked as the highest luxury brand last year, and among the top two brands overall (luxury and mass-market combined), had the sample size been large enough.
Audi, on 818 points, remains below the industry average but has taken a huge leap forward of 69 points over last year to overtake BMW, which has fallen three points to 782 over the same period.
JD Power’s ‘power circle’ ratings show that Mercedes performed well across all six factors used to determine the level of customer satisfaction, while Audi scored ‘about average’ in most categories but ‘better than most’ in ‘the deal’ which covers the ease of coming to an agreement, clarity of explanation of purchase and finance documents, timeliness of completing the paperwork and fairness of the price paid.
BMW scored only two out of five in each of the six categories.
In highlighting the discrepancy between the three brands, JD Power representatives point to the salesperson category – the biggest single factor (at 19 per cent) in calculating overall satisfaction – where Mercedes scored 861 points compared to Audi on 814 and BMW on 773 – 88 points behind Mercedes and 53 points behind the industry average for this section (826).
This category covers customers’ views on the salesperson’s knowledge about vehicles, courteousness and friendliness, concern that they purchased the best vehicle for their needs, appropriateness of sales pressure and fulfilment of commitments and promises made throughout the process.
In announcing the results, JD Power senior country manager (Australia) Loi Truong told GoAuto: “Audi has experienced improvements from last year, where they ranked last, to finish just below the luxury average this year, while BMW remained relatively unchanged.
“Mercedes-Benz’s strong performance is attributed to achieving ‘best make’ for 18 out of 22 sales standards that our study measures.
“Each of these sales standards are what drives satisfaction for Australian luxury car buyers.”
Mercedes is the market-leading brand by sales volume and currently the only one among the ‘Big 3’ German prestige brands to be experiencing year-on-year sales growth – after all three have routinely posted record annual results in recent years – as VFACTS figures released last week put the three-pointed star up 7.5 per cent for its passenger cars/SUV sales (to 28,800 units) and 15.9 per cent ahead for its light-commercial vehicles (4088).
BMW, on the other hand, is experiencing a sales downturn of 16.1 per cent so far this year (to 18,906 units) after a 12 per cent increase for the full year in 2016, while Audi is down 11.7 per cent to the end of September (16,044) and is facing a negative annual result after 12 successive years of record sales growth.
Senior management from all three brands have told GoAuto at various times that they were working overtime on building brand loyalty through improved customer service at both the front and back end of the dealerships in their respective network.
BMW’s result is particularly surprising given its efforts in rolling out new dealer standards in recent years and bringing new concepts and technologies to showrooms aimed at improving the buying experience.
In overall terms, the 2017 SSI study has found that more than a third (34 per cent) of new-vehicle buyers experienced sales pressure by the salesperson at the prestige dealership – a much higher proportion than buyers among the mainstream brands (27 per cent) – and that satisfaction among these customers is only at 730 points, 93 points below the average.
Examples of pressure experienced by prestige car buyers include purchasing unwanted accessories (18 per cent) – a notable factor given the long list of options typically available on any given prestige model – as well as purchasing the vehicle on the same day as the visit (18 per cent) and paying more for the vehicle than they wanted to (16 per cent).
In contrast, satisfaction among those who did not experience sales pressure (66 per cent) is 47 points above the luxury average, with basic things like courteousness and friendliness of the salesperson making all the difference.
A salesperson who fails to engage with customers, neglecting to ask questions such as current car owned, previous driving experience and intended usage of the new vehicle, also sees satisfaction plummet.
A notable 21 per cent of owners reported this, with satisfaction at 785 points (38 below average), whereas the level was well above average (833) among those whose salesperson took the time to interact with customers and better understand their needs.
Mr Truong said salespeople should be aware of the fine line between being attentive to a customer and applying too much pressure, particularly when the SSI study also found that more than a quarter of customers (28 per cent) were still unsure of either the make or model of the vehicle they wanted to purchase at the time they entered the showroom.
“Customers need to feel that the dealership values their business,” Mr Truong said. “When the salesperson asks a new-vehicle buyer the relevant questions to understand their needs and profile, customers are certainly more engaged and satisfied.
“A more dedicated and efficient approach to customer engagement also goes a long way toward building a lasting relationship.
“Simultaneously, the salesperson should remain cognisant of these needs without putting too much purchase pressure on the customer, as there is a fine line between being attentive and being pushy.” Among other results, younger customers – lured into prestige showrooms by increasingly affordable new model lines – are harder to please, with this under-35s group making up more than a third (35 per cent) of all buyers but coming out 10 points below the average in the satisfaction stakes.
This compares to older buyers (50-plus) who have a satisfaction level 45 points above the average.
The younger cohort also reports experiencing higher sales pressure (46 per cent) than those in the older age bracket (15 per cent).
The 2017 SSI study (luxury) is based on responses from 405 new-vehicle owners who purchased their vehicle/s between June 2016 and June 2017. The study was fielded from late January through to June this year.
Land Rover and Lexus were included in the study but not ranked due to small or insufficient sample size.
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