Nearly Half of Customers Visiting Car Dealerships Undecided on Vehicle Purchase, J.D. Power Finds
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Hyundai Ranks Highest in Sales Satisfaction in Australia among Mass Market Brands
MELBOURNE: 26 Sept. 2017 — Nearly half (43%) of customers who enter car dealerships have not yet decided on the exact make or model they plan to purchase, according to the J.D. Power 2017 Australia Sales Satisfaction Index (Mass Market) Study,SM released today.
Non-determined buyers are relying more heavily on the dealer’s or salesperson’s recommendation (49%), compared with those knowing in advance which make or model they will buy (35%). Additionally, overall satisfaction among SUV customers (811 on a 1,000-point scale) is 5 index points below the mass market average, in contrast to satisfaction among passenger-vehicle customers (819), which is 3 index points above average. This is particularly noteworthy given that SUV sales account for 42% of all new-vehicle sales in Australia. Notable gaps in satisfaction are centered on delivery timing (820 points vs. 800 points among passenger-vehicle and SUV customers, respectively) and the deal (814 points vs. 806 points among passenger-vehicle and SUV customers).
Customers are more appreciative of vehicle pricing when they are walked through the details both during the sales process and at the time of their vehicle delivery. Nearly half (45%) of SUV customers, who indicate their salesperson did not spend enough time at delivery, say they paid more than they expected, 6 percentage points higher than passenger-vehicle customers. Overall, satisfaction increases significantly (+41 points) when customers receive free value-added services—such as complimentary car wash, pick-up and delivery. Satisfaction is also positively impacted by free gifts (+37 points); free vehicle service package (+34); free extended warranty (+24); free first-year car insurance (+23); and free accessories (+16).
“Australia is now becoming a full import car market and SUVs continue to substantially drive vehicle sales growth,” said Loi Truong, Senior Country Manager at J.D. Power. “However, customers’ needs should not suffer as a result. Understanding changing customer expectations, keeping customers updated pre- and post-sales, as well as delivering consistent customer experiences across the network are key to ensuring an elevated sales experience and can, ultimately, go a long way toward securing customer retention.”
Once the decision to purchase a vehicle has been made, it is vital for the salesperson to keep the customer informed about the status of their vehicle delivery. More than one-fourth (26%) of SUV customers whose salesperson did not keep them informed of the vehicle delivery status indicate that the delivery time was worse than they expected, compared with 20% of passenger-vehicle customers who say the same. The average satisfaction among passenger-vehicle owners increases to 843 points (to 831 points among SUV owners) when their salesperson keeps them informed of the delivery status. With an average delivery time of 12.4 days for SUV owners (2 days more than for passenger-vehicle owners), 13% of these owners indicate that the delivery timing was worse than expected (vs. 8% for passenger-vehicle owners).
Following are additional findings of the 2017 study:
- Satisfaction is higher among older car owners (50 years or older) than among younger owners (younger than 35 years)—849 vs. 786, respectively. More than 4 in 10 (41%) younger owners experienced pressure from dealer staff, compared with 17% of older car owners. More than 1 in 5 (22%) customers younger than 35 years old say they felt under pressure to purchase accessories they did not want, compared with 8% of older car owners.
- Among the top five main vehicle purchase reasons, those that most drive satisfaction include exterior styling (+23 points); previous experience with the brand (+17); good reputation of the brand (+16); vehicle with the latest features (+7); and vehicle safety (+6).
- Among highly satisfied customers (overall satisfaction scores of 919 and higher), 84% say they “definitely would” repurchase the same brand of vehicle and 90% say they “definitely would” recommend the brand to family and friends. In contrast, among customers who are highly dissatisfied (scores of 745 and lower), only 33% say they “definitely would” repurchase the same brand and recommend the brand to others.
Of the 12 brands ranked in the mass market segment, Hyundai ranks highest with a score of 827, followed by Kia with a score of 824 and Holden with 823.
About the Study
The 2017 Australia Sales Satisfaction Index (SSI) Study examines six factors that contribute to overall customer satisfaction with the new-vehicle purchase experience. In order of importance, they are salesperson (19%); deal (18%); delivery timing (17%); delivery process (17%); dealer facility (16%); and sales initiation (14%).
The study, now in its second year, is based on responses from 2,779 new-vehicle owners who purchased their vehicle from June 2016 through June 2017. The study was fielded from end-January through June 2017.
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About J.D. Power in the Asia Pacific Region
J.D. Power has offices in Singapore, Bangkok, Kuala Lumpur, Beijing, Shanghai and Tokyo that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries in the Asia Pacific region. Together, the six offices bring the language of customer satisfaction to consumers and businesses in Australia, China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan, Thailand and Vietnam. J.D. Power is a portfolio company of XIO Group, a global alternative investments and private equity firm headquartered in London, and is led by its four founders: Athene Li, Joseph Pacini, Murphy Qiao and Carsten Geyer. Information regarding J.D. Power and its products can be accessed through the internet at asean-oceania.jdpower.com.
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