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Market Focus: Automotive: Adapting to Altered Buy Environments
Consumers buy cars differently from how they did a generation ago. Makers and distributors must respond to the changes or become last year's model.
For the rest of the March 2007 issue of CRM magazine please click here
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As automotive dealers, manufacturers, and third-party firms (e.g., parts suppliers, auto finance companies, and insurance companies) struggle with the realities of a changing market, top-flight customer service can help separate the profitable portions of the industry from the laggards, according to Belis Aksoy, associate analyst for Jupiter Research. The industry is battling changing consumer tastes--with the high price of gasoline, the sales of large SUVs waned in 2006, and though gas prices have fallen, SUV sales haven't returned to what they once were. Consumers are also shunning the minivan and moving toward the crossover vehicle, so reacting to these changing desires is important for the future profits of auto manufacturers. Ford and GM have announced they will be dropping minivans from future production. Add to that a much tighter credit picture than in the last few years due to higher interest rates--meaning less financial resources for a consumer to buy an auto--and the need to provide good customer service to attract customers to the dealership and to close sales, and the value and necessity of CRM is clear. A critical factor in meeting these CRM needs is responsiveness via the online channel, particularly when it comes to responding to customer emails, Aksoy says. "The speed of Web-site responses to email inquiries is very important to online consumers making purchase decisions. However, CSRs of only 16 percent of automotive sites respond to such inquiries via email in six hours, while 41 percent [of consumers] expect them to do so." Another key factor is the quality and depth of the response. Consumers are no longer satisfied with a message that acknowledges receipt of their email with a promise to provide an answer within 24 hours. Consumers want the answer or the appropriate information from which they can determine the answer (e.g., online information from the owner's manual) within six hours of sending an email. Beyond email responses, progressive auto sites are providing proactive text chat capabilities, Aksoy says. If the user clicks a certain number of times at the Saturn site, for example, or if the click stream indicates he's "lost" on the site, a window will pop up asking if he'd like to chat with a CSR.
Aksoy expects more dealers to start offering more robust customer feedback options on their sites. "Those capabilities are available today, but so far few dealerships have employed them." Top 3 Vendors in Automotive: Oracle Microsoft SAP (Source: Forrester Research) Case Study: Boosting Customer Responses Surveys only provide valuable information if there are enough respondents to draw conclusions. While typical survey responses fall in the 2 percent to 4 percent range, Moore Auto Group has found a system that results in nearly a 25 percent response rate. According to the National Automobile Dealers Association, service and parts typically provide 58.5 percent of a dealership's profits. Moore's service department had used generic hang tags that included customer information, the customer's keys, and a satisfaction survey that was designed to provide feedback used to improve customer service. But the surveys were rarely completed and returned, according to Ed Troutman, fixed operations director for service in the parts and body shop. He came across the ScanTRAX hang tag system from DiversiForm, at another dealership. The system includes the photo of the service manager who handles a specific vehicle, and colorful, prepaid postcard questionnaires that DiversiForm scans upon receipt to provide comprehensive feedback information to the dealership and service managers. Moore recognizes those with the top scores for their efforts. DiversiForm notifies dealers and service managers of dissatisfied customers within hours via email, fax, and/or phone. This service is important, according to Troutman, because the manufacturers require dealers to maintain certain customer satisfaction levels to keep their ratings (e.g., Chrysler's five-star program), and in some cases to get or retain the franchise. Troutman wants the type of quick feedback that DiversiForm provides so that any problems can be corrected before a customer complains to one of the manufacturers the different dealerships within the group represent. --P.B.
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