Created on Monday, 09 August 2010
As a society, we are obsessed with surveys.
We rate everything from books, movies and TV commercials to pre-packaged foods, hotels and, of course, automobiles. Today, consumer opinions (solicited and unsolicited) are sought on all manner of products and services.
In our business, manufacturers and dealers invest a lot of money and resources to receive feedback from their customers. Their opinions are critical to the development of automobiles and auto-related services.
Prior to the 1980s, customer surveys in the auto sector were infrequent. Since then, automakers have recognized the importance of seeking feedback from the customer and developing their products and services accordingly.
But are surveys really that accurate in gauging customer reactions, opinions and attitudes? Does the industry pay too much or not enough attention to the results?
In 2009, J.D. Power and Associates (a leading research firm specializing in measuring consumer opinions) stated that "those automakers whose dealers provide the highest levels of satisfaction during warranty period retain a greater share of future service visits at the dealerships, even after the warranty period."
The same study concluded that "brands with dealers that achieve particularly high CSI (Customer Satisfaction Index) scores (80 per cent or higher) during the first three years of vehicle ownership retained 70 per cent of dollars spent on maintenance and repairs during the first five years of ownership."
There is a strong correlation between satisfied customers and increased business for automakers and dealerships.
Our industry has several methods of measuring the satisfaction of customers who purchase and service vehicles at new car dealerships. Some surveys are sponsored by the manufacturer or directly by the dealer, while others are generated by independent third parties, such as research firms and consumer groups.
The common survey criterion among auto manufacturers is the Customer Satisfaction Index (CSI). CSI scores measure customer responses to various points of contact within a dealership (new or pre-owned vehicle sales, service, parts, collision repairs, etc.).
Dealers are expected to attain high CSI scores across all departments. Often, scores below 93 per cent are regarded as poor and dealerships that consistently rank below that number are encouraged by the manufacturer to improve their scores.
When a new car dealer achieves consistently high CSI ratings, managers, salespeople and other staff members will often receive special recognition from the manufacturer.
CSI results from one department tend to influence other departments. For instance, when customers rate a dealership highly for their sales experience, they are inclined to visit its service department. Continued satisfaction on the service side will motivate them to patronize that same dealership when it's time to buy a new car.
As insightful as CSI scores are, however, they are not foolproof. Occasionally, automotive survey questions can be misleading – such as, did the Salesperson Explain the Details of Your New Car Warranty?
At some dealerships, this task could be the responsibility of the business manager, so a customer would have to answer "no" to this question, even though they may have been sufficiently informed.
If the question was worded, "Were the details of the new car warranty explained to your satisfaction?" either a positive or negative response would be a more accurate measure.
Lack of response is the most common shortcoming with the survey process. Many completely satisfied customers tend to ignore survey requests. This will skew the results when contrasted with an unhappy consumer, who is more likely to respond when asked.
Our industry relies on your feedback. The next time you receive a survey from an automaker or a dealership, I encourage you to respond openly and honestly.
Your valued opinions are important.