First New Vehicles, Now New Dealerships

After launching a slew of new products in the U.S. during the last few years, Nissan North America Inc. says it now is turning its attention more than ever to pleasing its customers.

The Japanese auto maker is trying to fill the pipeline with the products that people want, plus trying to improve the buying experience at its U.S. dealerships, says Jed Connelly, NNA's senior vice president-sales and marketing.

Buying a vehicle can be a “long, slow, arduous process” he says. Because of this he says Nissan is working to update its dealerships, which had the oldest signage in the industry and hadn't been refreshed since the mid-1980s. Connelly says the remodeling has led to better employee morale and CSI scores.

“We have 300 dealerships that are in process (of updating their facilities),” he says, adding those not finished yet should be completed by the end of Nissan's fiscal year (March 31, 2005).

“We will have had 500 consults done, so basically we have 500 dealerships that are done or are in process out of about 1,050 dealers,” Connelly says of Nissan's U.S. showrooms.

Of the dealers updating their facilities, he says some 60% are exclusive Nissan stores. Eighty percent of sales are generated at standalone Nissan dealerships, Connelly says.

“The dealers who've done what we call the ‘N Ready’ program are up an additional 50% (in sales),” he says, adding employee caliber has risen, there is less employee turnover, grosses are higher (with profits up 25% on average) and CSI scores also have risen at its U.S. dealerships.

Although its Infiniti luxury marque performed well, the Nissan brand came in below the industry average in 2004's J.D. Power & Associates Customer Satisfaction Index (CSI) survey, which measures customer satisfaction with dealer service departments in the first three years of vehicle ownership.

“We're getting a little more sophisticated with some of our processes,” says Connelly. “We should be better in touch with customer demands up front, but you're always going to miss something. The key is to adapt and make good adjustments, and I think we've done that.”