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Jaguar, Mini top US sales satisfaction index
Study shows treatment at the dealership is more important to buyers than price
29 Nov 2010
By TERRY MARTIN
AS NEW-VEHICLE sales continue to strengthen in the United States, JD Power and Associates has found the treatment of customers at the dealership the most important factor behind their decision to buy – more so than the actual transaction price – and that Mini (among mass-market brands) and Jaguar (among luxury brands) lead the way in buyer satisfaction.
In its just-released 2010 US Sales Satisfaction Index (SSI) study, which was done between August and October and is based on responses from 25,244 new-vehicle buyers who purchased or leased their vehicles in May, JD Power found that 52 per cent cited treatment at the showroom as the reason to buy their new vehicle from a specific dealer.
This compares to just 38 per cent citing vehicle price or the deal being offered as the reason for selecting a retail outlet, while the rejection of a dealer through poor treatment caused most respondents go on to buy a vehicle from a different brand.
JD Power’s director of automotive research Jon Osborn said dealers could not afford to drive away customers through poor treatment.
“In addition, most of these rejecters go on to purchase a different brand of vehicle entirely, meaning that both the individual dealer and the auto-maker lose out,” he said.
According to JD Power, once a buyer selects a dealer, the ease of coming to an agreement on the final price has the single-greatest influence on buyer satisfaction, surpassing the importance of fairness of the actual price paid.
The survey also found that that, with the exception of selecting a vehicle, negotiating the deal was the aspect of the new-vehicle buying process that took the longest time (53 minutes, on average).
Among the best-performing mass-market brands in the US, JD Power rated Ford’s soon-to-be-discontinued Mercury brand (795 out of 1000) and GMC (792) second and third respectively behind Mini (805) in the SSI, which measures customer satisfaction across four factors: working out the deal, salesperson, delivery process and dealership facility.
In descending order, Chevrolet (787), Buick (784) and Ford (770) were ranked next, while the brands demonstrating the greatest improvement from 2009 were Hyundai – which moved from 16th to seventh this year – and Chrysler, which rose from 15th to eighth.
Suzuki (759) and Kia (753) were the only other brands above the mass-market brand segment average of 751 points, leaving some major brands trailing behind.
These include Honda (750), Subaru (747), Toyota (742), Toyota’s youth brand Scion (736), Mazda (727) and Volkswagen (719), while Chrysler’s Dodge, Jeep and Ram brands each came in with 714 points.
At the bottom of the table were Mitsubishi and Nissan, both on 707 points.
With 828 points out of 1000, Jaguar’s top ranking among the luxury brands was its third in succession, satisfying Americans with the new-vehicle buying experience more than its rivals and performing particularly well, according to JD Power, in the salesperson and working-out-the-deal factors.
In second and third place respectively, and holding their ranking from 2009, were Cadillac (819) and Mercedes-Benz (815), while Ford’s Lincoln brand (814) demonstrated the greatest improvement in the space of a year, moving from sixth position last year to fourth in 2010.
Often regarded as a benchmark at the retail level, Toyota’s Lexus brand was rated only fifth best on 812 points, ahead of Land Rover (809), Porsche (800) and BMW (799).
These were the only brands above the luxury segment average of 798 points, with the four marques below this point being Honda’s Acura brand (768), Nissan’s Infiniti (768), Audi (764) and Volvo (754).
The study found that 60 per cent of buyers visited more than one dealership during the shopping process, and while many dealers were rejected for not having a vehicle that the buyers wanted to buy, a significant number of buyers (18 per cent) ended their showroom visit “primarily due to poor customer treatment by the dealer’s salespeople”.
Interestingly, JD Power said that while some buyers complained about dealer sales staff applying too much sales pressure, an “equal proportion” complained about receiving insufficient attention from salespeople.
Other frequently mentioned complaints included dealer staff being discourteous or not being straightforward with the buyer.
Mr Osborn said the process of working out the deal was the “primary indicator of whether new-vehicle buyers have a satisfactory purchase experience” and stressed that, given many people find it the most unpleasant part of purchasing a vehicle, it was “particularly important for retailers to make this process as efficient and collaborative as possible, given its importance to overall satisfaction”.
JD Power also found that the internet continues to play an increasingly important role in new-vehicle shopping, with 79 per cent of buyers using the web during the process.
The company said 24 per cent of buyers in 2010 submitted an online request for a quote to a dealer, and were, on average, more satisfied with the negotiation process and the price paid.
However, perhaps expecting a quicker sales process, these buyers were more likely to express dissatisfaction with the length of the sales process than buyers who did not submit an online request.
“Dealers need to streamline the new-vehicle buying process for customers who do a lot of research online,” said Mr Osborn.
“These buyers tend to be affluent, well-informed and time-sensitive. They generally know the exact vehicle they want and how much they expect to pay for it.
“Despite often having little familiarity with the dealership they are buying from, they want to get in and out as quickly as possible. Dealers need to balance respect for the customer’s time while still providing what the customer needs.”
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