Ways To Make Them Happy

Small acts can boost dealership customer satisfaction in big ways, says Brad Larsen, Toyota Motor Sales U.S.A. Inc.'s national manager-customer retention.

For instance, when a customer takes delivery of a vehicle, dealership personnel should explain operating features, offer to customize settings and offer to schedule a first maintenance visit.

“We've found these delivery tips work, and none of them cost money,” Larsen says. “When all three are followed, satisfaction levels are at 94%. If they are not followed, satisfaction levels are around 64%.”

Although most dealerships explain operating features to buyers, most stores don't offer to customize settings, schedule an initial maintenance visit or acquaint customers with the service department, he says.

Most service managers think showroom sales people tout or otherwise tell their customers about the back shop in the hopes of directing future business there.

In fact, such service-department introductions only occur about 60% of the time, Larsen says. “Why wouldn't it be 100%?”

Toyota is trying to impress dealership personnel that they all are on one team despite their different job descriptions.

“That sold car is why the service department has business, and if the service department treats customers right, they'll be back to buy another car,” Larsen says.

He is part of an effort to try to raise satisfaction levels at Toyota dealerships, which tend to score below average.

Part of that is due to the brand's popularity, creating a seller's-market mentality at many Toyota stores, although the current industry-wide sales slump has done much to change that way of thinking.

Consumers show greater loyalty to Toyota's products (65%) than its dealerships (50%), according to corporate data.

“The difference is too great to ignore,” Larsen says. “For every customer who leaves one Toyota store and buys at another Toyota store, there is a customer who leaves a Toyota store and buys from another brand's dealership. That gets our attention.”

Technicians, sales people and managers are undergoing training, “so we have better customer experiences delivered at every touch point, from the dealer to the valet,” he says.

Toyota recently began using NADA 24, a feedback system in which dealership customers are immediately contacted by phone to determine if they're satisfied with services provided. “It lets dealers fix problems fast,” Larsen says.

It's paying off, he says. Toyota has decreased the number of customers who reject a dealership due to perceived ill treatment. “It's not rocket science,” Larsen says of customer-satisfaction efforts. But sometimes it's not easy.

One impediment is that dealerships typically experience high employee turnover rates, sometimes as much as 100%. “It doesn't mean the top people are leaving, but it means the bottom 25% may churn three to four times a year,” Larsen says. “That's something to look at as a root cause.”

Overcoming the obstacles is worth it because happy customers are 10 times more likely to purchase a vehicle from the same store, more likely to purchase a higher-priced product and require less marketing to bring them in, he says.

“Yet, many dealerships keep making the first sale over and over,” he says. “They spend a lot of time and money to bring customers in for the first time, but fail to make them feel like welcomed guests.

“It's more than just greeting them. It's using their name, letting them speak; finding out why they are there and what they need.”

Toyota's satisfaction-efforts include ensuring proper inventory levels and urging dealers to expand facilities, some of which have not kept up with the growth of the brand. Toyota has about 1,250 dealers in the U.S. Many of them have invested a total of $6 billion in a facility-upgrade program.

Another customer-satisfaction goal is to speed things up at dealerships. Main beefs about delays include waiting too long for paperwork to be done and for delivered parts to arrive.

“If customers perceive their time is wasted, they perceive the time is longer than it actually is,” Larsen says. “We know our dealerships are busy. But don't let customers sit there with dead time.”