Chevy Dealers Deliver Best Customer Experience in Auto Industry

This post examines the 1o auto dealers included in the 2012 Temkin Experience Ratings.

Chevrolet was the top rated auto dealer and the only one to receive a “good” customer experience rating, and 57th overall out of the 206 companies in the ratings. Three auto dealers were next in line with “okay” ratings: Toyota, BMW, and Honda. The remaining six auto dealers earned “poor” ratings with Kia falling to the bottom of the list.

The average rating for the overall auto industry placed it 14th among 18 industries, only outpacing health plans, Internet service providers, TV service providers, and computer makers.

Looking across the three components of the Temkin Experience Ratings, Toyota leads in functional experience and Dodge is at the bottom; Chevy and BMW lead in accessible experience and Hyundai is at the bottom; and Chevy leads in emotional experience and Kia is at the bottom.

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: Chevy dealers are setting the CX pace in the auto industry

The US Auto Industry Needs More Customer Focus

Given the current struggles in the auto industry, I revisited at a post called GMs customer experience woes. It referenced an article written by HBS professor John Quelch that outlined eight reasons why GM failed as a marketer. The number one item on his list was GM’s focus on products, not customers. For regular readers of this blog, you’ll recognize that this directly conflicts with the first principle of Experience-Based Differentiation: Obsess about customer needs, not product features.

The post also referenced some data from the 2008 American Customer Satisfaction Index (ACSI). I examined the data again and developed this chart which shows how US car brands rate in terms of their customer satisfaction and the change in satisfaction levels between 2007 and 2008.

2008autosatisfaction_small

Some things pop out quickly on this chart:

  • The top four brands are all foreign; and three of them are from Japan.
  • The bottom five brands are all American; and three of them are from Chrysler.
  • GM owns the top three US brands; and four out of the top five US brands.
  • Saturn is the top US brand; and it is also the brand that improved the most since last year.
  • Eleven brands improved over 2007; and only four of them were from the US.
  • Seven brands declined from 2007; and six of them were from the US.

The bottom line: The US needs a more customer-centric car industry.

Top Execs Share Their (Sad) Thoughts On The Economy

BusinessWeek interviewed eight corporate execs about the their thoughts on the economy. It’s really interesting to hear their perspectives. Here are excerpts from their comments:

  • FRED SMITH, FedEx: It is by far the worst I’ve seen in the 35 years I’ve been in business… The only good thing is that if anything turns this around, it’ll be pretty quick, since inventories are at such incredibly low levels. But I’d be very surprised if anything started to turn around before the middle of next year.
  • ROBERT NARDELLI, Chrysler: …our 6.5% unemployment rate… could go to 10%-plus. Even with aggressive resizing, we can’t keep up with it because we haven’t seen the bottom.
  • RALPH DE LA TORRE, Caritas Christi Health Care: We live and die on the tax-free bond market, and right now we’re dying… I think there’s going to be a pretty substantial consolidation in health care. As many as 20% of hospitals could close. There’s going to be no capital spending for at least the next year or two.
  • MILES WHITE, Abbott Laboratories: If you’re on a drug that’s reasonably discretionary, you might cut back as a patient. But if you’re on a drug for a chronic problem, you’re not cutting back… I wouldn’t call [our situation] severe.
  • LEWIS HAY, FPL Group: Probably 25% of our customers are past due. Normally, it’s more like 15%… With such a shortage of access to capital, how are we going to get all these alternative energy projects going?
  • DENNIS DAMMERMAN, former GE vice-chairman:  And while I don’t agree with much of what Barack Obama wants to do, I think that for a great chunk of our consuming public, he has improved that confidence. I hope this enthusiasm doesn’t die.
  • TIMOTHY MANGANELLO, BorgWarner: We’re preparing for nothing good until mid-2010… it’s possible it won’t improve by then… the cost structure in the U.S. has to improve. Health-care costs are too high. Tort reform is too difficult. And business taxes are too high.
  • FRED HASSAN, Schering-Plough: The key is inflation. If inflation stays under control and confidence returns, we’ll come back early. If inflation starts to roar in mid-2009 and thereafter, we have a problem. It might start to look like the mid-1970s.

My take: Overall, this doesn’t sound too encouraging for 2009. The only positive notes are that inventories are already pretty low and that President-Elect Obama may be able to bolster consumer confidence.

I’m hopeful that Obama will remain as inspirational and as non-partisan as he appeared to be during his acceptance speech.  I’ve also posted a couple of pieces of advice to the new administration: Appoint a Citizen Experience Officer and Revive “Brand USA.” 

For senior executives, I think the basic decision remains: Are you going to manage your way through the recession or lead your company out of it?

 The bottom line: I’ll keep offering advice on how to manage in a recession.

The Satisfaction Quarterly Report, Q2 2008

The American Customer Satisfaction Index (ACSI) just released its Q2 2008 report that covers the following sectors: Internet news & information, portals & search engines, automotive, electronics, major appliances, and personal computers. As I mentioned in a previous post about the ACSI, it’s a great research effort that doesn’t gets enough visibility.

Here are some highlights of the new data:

Ratings Of Firms

  • Top rated: Toyota and BMW
  • Top rated relative to industry average: Apple and Google
  • Largest improvement (since last year): Google and Apple
  • Lowest rated: AOL and HP
  • Lowest rated relative to industry average: AOL, Chrysler Jeep, and Ask.com
  • Largest decline (since last year): Whirlpool and HP

Ratings Of Industries

  • Top rated: Electronics
  • Largest improvement (since last year): Internet Portals & Search Engines
  • Lowest rated: Personal Computers
  • Largest decline (since last year): Major Appliances

While it’s interesting to look at the data, I also like to read the commentary by Professor Claes Fornell who puts the customer satisfaction results in context of the overall economy. Here’s an excerpt from his Q2 2008 comments:

Future consumption growth is impeded by many factors, chief among them house-price deflation (which has trimmed household wealth), tougher credit conditions, a worsening labor market, and continued high fuel and food prices… Under these circumstances, even if customer satisfaction were rising, it would be difficult to offset pocketbook limitations. But since ACSI shows no aggregate growth, the outlook for more aggregate spending growth continues to be bleak… The ACSI forecast suggests a third quarter spending growth of no more than 2.3% and the economy will continue to struggle… But all is not doom and gloom. E-business and technology lead the way. Customer satisfaction for e-business is up by almost 6%.

The bottom line: Satisfaction may be down, but Apple and Google are doing something right

Chrysler Avows New Customer Experience Religion

Yesterday’s USA Today provided a double-header for my blogging. In addition to the ad from AA pilots, there was also a full-page ad from Chrysler that started as follows:

Quality is one of those fluffy words. After you see it or hear it enough times, it doesn’t mean anything anymore

The ad announced that the auto maker had created a Chief Customer Officer position and that it aims to put the customer first, which it described as a “basic rule of corporate etiquette.”

My take: The beginning of the Chrysler ad reminded me of My Manifesto: Great Customer Experience Is Free. In that post, I discussed how customer experience is a lot like quality. So, hopefully, Chrysler execs are reading my blog and/or research.

If they are reading this blog, then I suggest that they also follow my advice about how to successfully implement the role of Chief Customer Officer. That research outlined five broad areas of focus: 1) Make sure that you’ve got the right environment; 2) Prepare to take on a broad change agenda; 3) Establish a strong operating structure; 4) Kick off high-priority activities; 5) Look ahead to the future.

But the presence of a Chief Customer Officer does not immediately convert Chrysler to the customer experience sect. The entire executive team needs to learn, internalize, and dedicate themselves to a new set of sacred rituals. What text can they use for guidance and inspiration? You guessed it: Experience-Based Differentiation (EBD). EBD is a blueprint to customer loyalty that builds upon three principles:

  1. Obsess about customer needs, not product features
  2. Reinforce the brand with every interaction, not just communications
  3. Treat customer experience as a competency, not a function.

As a start to the conversion process, the executive team should take the EBD self-test and use the results as a basis for discussing where to invest their time and energy.

The bottom line: You can’t convert to the customer experience religion by proclamation; you need to dedicate your professional life to it.

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