Written by Steve Shannon, Advisor and Former CMO at Hyundai Motor America

The auto industry is going through the most disruptive period in its 100+ year history. With the advent of autonomous vehicles, electric vehicles, car sharing, ride sharing, subscription services, new OEM start-up entrants, etc., all the “rules” of the business are being re-written.

And there is another place where the rules are changing…in the Customer Experience. As younger Gen X, Y, and Z customers make-up a greater share of car buyers and service customers, and even Boomers become more tech-savvy, their expectations are different and higher.

Carmakers are watching these changes closely…just look at the number of OEMs that have created ‘C’ Suite positions with job titles that include “Customer Journey” or “Brand Experience” or just “CX,” the shorthand for Customer Experience. And these positions have dedicated teams studying the changes and developing strategies and tactics to improve their brand’s performance and meet the new expectations.

Dealers are certainly also making changes in their processes to meet the new customer expectations, implementing a wide range of new technology tools, training, hiring processes, focus on culture and values, and other measures.

So, both OEMs and dealers are hard at work understanding and improving the customer experience, and there is some good progress. But like many things, the overall pace is lagging consumer expectations, and there is a wide variance in delivery.

With over almost 3,000 dealers on the Podium platform, we are watching the changing expectations of customers very closely too and want to be part of the solution. So, to understand the space better, we turned to the auto research experts at J.D. Power.

We asked J.D. Power to dig into their rich data and look for insights on an issue central that is core to what we do, the communication between the customer and the dealer. They poured through two of their studies:

  • The 2019 Sales Satisfaction Index (SSI), a survey of 28,000 sales customers
  • The 2019 Customer Service Index (CSI), a survey of 58,000 service customers.

The insights for improving the customer experience were profound, and we offer below a summary of their key findings.

But first, just a quick high-level look at the scale we’ll be using.  The chart below ranks the non-Premium brands by their overall 2019 SSI score. The score, for example, Buick’s 795, is an index JD Power creates that includes all the dozens of questions on the survey, then summarized in 6 categories including “Dealer Personnel,” “Working out the Deal,” and “Delivery Process.” So, as we look at the insights below, we will be referring to the change in this overall Index score driven by various processes.

Ok…on to the insights. Below we summarize JDP’s 6 key takeaways, with a data point or two for illustration.

  • Based on feedback from over 28,000 sales customers and 58,000 service customers, dealership use of texting during the shopping and after-sales experience supports a significantly improved customer experience.
  • While customer preference for text communications has increased at a steady rate, dealership usage has not kept pace. For example, service customers’ preference for text updates is 34%, and yet just under 9% actually receive texts. And for younger Gen X, Y, and Z customers, over 50% prefer to text, but just 11% receive them.
  • Almost all brands benefit from text usage. Yet no brands consistently provide their customers a text-friendly customer experience.
    • In the Non-Premium segment, CSI increases 26 points with service customers who text, and 18 with new car shoppers texting
    • In Premium, CSI is up 27 points and SSI is up 10 points
  • Text messaging is superior to all other forms of customer/dealer communication. For example, the table below illustrates that as car shoppers move from texting, to phone, to chat, to email, SSI scores fall between 6 and 27 points.
  • Average SSI score by message type for “Contacted Dealer Prior to Visit”.

Non-Premium

  • Text                                   837      Diff.
  • Phone                                831      -6
  • Chat                                   831      -6
  • Email/web form              810      -27
  • Average SSI score by message type for “Contacted Dealer Prior to Visit”.

Premium

  • Text                                   857      Diff.
  • Phone                                848      -9
  • Chat                                   836      -21
  • Email/web form              838      -19

And among service customers, in the move from the most effective communication method (texting) to the least effective one (“not kept informed”), the drop in CSI is even more dramatic.

  • Average CSI score by message type for “informed on progress of Service work” question.

Non-Premium

  • Text                                               853      Diff.
  • Dealer Called                               828      -22
  • Customer Called                          712      -141
  • Not kept informed                      680      -172
  • Average CSI score by message type for “informed on progress of Service work” question.

Premium

  • Text                                               889      Diff.
  • Dealer Called                               876      -13
  • Customer Called                         741      -148
  • Not kept informed                     699      -190
  • Among all communication channels, text contributes to the most significant decrease in sales process time: 33% of customers who use texting spend less that 2 hours at the dealership.
  • Use of text service creates the highest intended service loyalty among communication channels, with 61% of non-Premium and 64% of Premium customers intending to return to their dealer for paid service.

So, what did data from 86,000 car shoppers and service customers reveal…one simple truth. 

It’s really important to communicate with people the way they want to be communicated with. It improves their experience, reduces the time in the dealership, and drives increased loyalty. Download the full J.D. Power report below.