Service and sales operations improve at vehicle franchises, says Ipsos survey

001-off-my-wheelsFranchised retail motor dealers in South Africa, obviously driven by the demands of manufacturers and distributors, continued to raise the bar in terms of their sales and service operations. This is according to the annual Ipsos Quality Awards Purchasing and Servicing customer research for 2014, which was released this week.

Ipsos, which is one of the world’s largest market research companies, has been conducting syndicated market research on behalf of the SA automotive industry since 1991, albeit under various names including Proactive Marketing and Synovate.

The company conducts telephonic interviews with 25 000 customers annually about their experience at franchised dealerships when purchasing a new vehicle of having their vehicle serviced. The brands that participated in the 2014 survey represent more than 85% of the new vehicles sold via the dealership channel in SA. The representation of the study is calculated on new vehicle sales.

The research of the customers’ experience at franchised dealerships follows a syndicated format with various manufacturers and distributors contributing ideas and funding. Any motor company can participate if they supply names for interviewing, agree to the rules of syndication and participate in meetings and the making of decisions regarding the syndicate business in a transparent and open manner.

The research by Ipsos has shown an improvement in both the sales and service operations virtually every year since this comparative research was first conducted in 2004, despite growing technological complexity in motor vehicles, a shortage of skilled technicians and more demanding customers.

Perceptions of the purchasing experience when buying a passenger car has crept up from 90% in 2004 to almost 95% last year, while buyers of light commercial vehicles are similarly satisfied, moving up from a score of 89% to more than 92% in the past decade.

The way customers perceive the servicing experience has improved even more dramatically though and here it is interesting to note that owners of LCVs are even happier than car owners as their scores have been better than those of the car owners every year except for 2013. The customer satisfaction score for servicing passenger cars has risen from 78% to just over 88% in the past 10 years, with service ratings by LCV owners going from just over 78% to 88.5% over the same period.

According to Patrick Busschau, the Ipsos Automotive Business Unit Director, the biggest improvement in the purchasing experience for both cars and LCVs in the latest survey was due to a courtesy follow-up call after delivery. “The courtesy call is a great opportunity to once again deliver a branded experience, and is the perfect way to complete the transaction. However, it is not just the act of performing courtesy calls, but a combination of how professionally, memorable and courteously they are done as well as how effectively problems, complaints and queries are resolved,” said Busschau. He confirmed that dealer commitment metrics have also improved in several aspects. This included the likelihood of continuing to use the same dealer, building a lasting connection with the dealer and having confidence in the dealer taking ownership during the buying transaction.

Top rated attributes included dealers listening to their customers and being aware of their needs; the vehicle being delivered according to the agreed specification and the dealer offering a vehicle that suits the buyer’s budget.

Dealers also performed well where it came to salespeople explaining maintenance requirements and operational features, and making an effort to understand the customer’s needs and providing an exciting hand over experience.

It was interesting to note that the buyers of LCVs gave their highest ratings for virtually the same attributes as the car buyers, with the top four LCV attributes mirroring the PC market. However, explaining the total cost of ownership of the new vehicle displaced exciting hand over experience as the fifth best attribute according to LCV customers.

There were differing views in the two groups of customers when it came to the servicing experience.

Here the top three attributes that impressed car owners most were:  trusting the dealer to take good care of the car, fixing any problems the first time and the servicing staff being prepared for the car.

LCV owners reserved their highest ratings for having the vehicle ready at the promised time, (with this attribute only ranking fourth in the passenger market). Dealerships found providing transportation services to LCV customers a challenge, with this metric receiving the least favourable ratings from LCV customers. In part, this could be attributed to the higher incidence of remote customers in the LCV market having to travel great distances to have their light commercial vehicles serviced.

Nevertheless, great strides have been made in offering transportation services, with PC ratings for this aspect improving by 2.8% vs 2013 and LCV ratings by an impressive 3.3%.  The advances made in this respect were largely responsible for the improvements in the overall servicing experience of passenger as well as LCV customers, followed by improved perceptions of courtesy follow-up calls and work being done correctly in the LCV and passenger markets respectively.

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