When purchasing high involvement consumer durables such as new cars, consumers are assumed to progress through the following stages: Problem or Need Recognition; External Search; Alternative Evaluation; Purchase or Choice; Outcomes or Postpurchase Evaluation (see, for example Bettman 1979; Engel, Blackwell and Miniard 1993; Howard 1989). Much car buying research effort is directed at the latter stages of this process: buyers' uses of various information sources, choice-making strategies, post-purchase satisfactions, etc. However, the main proposition of this paper is that the initial phases of the consumer decision process have a major effect on the subsequent stages. In particular, it is proposed that the problem recognition "event" and the consequent retrieval of product related decision constraints from memory, substantially influences the ensuing processes of external information search, evaluation of alternatives and consideration set formation. The results from a national sample of new car buyers suggest that the type (rather than the amount) of prior decision constraints, identified as either marketer-related or household-related, that are activated as a consequence of the problem recognition event, significantly affect the "path" customers might follow through the remainder of the purchase process. The findings have important implications for modifying the traditional view of the consumer decision process as an orderly sequence, and for marketers to develop appropriate intervention strategies based on how prior decision constraints affect new car buyers.
Four areas of research pertinent to the measurement of Customer Satisfaction are examined. The four areas and the key findings from each are summarized below. 1. Theoretical Views Regarding Customer Satisfaction Satisfaction results from the confirmation of customers' expectations. Satisfaction is similar to attitude in that it is both multi-dimensional and has an affective component. Customer Satisfaction pertains to a transaction, such as a service experience, while attitude pertains to an entity, such as a vehicle or a marque. 2. Customer Satisfaction Measurement is Analogous to "Quality" Measurement The "Confirmation of Expectations" paradigm of Customer Satisfaction is analogous to the "Quality Function Deployment" paradigm for products, and to the "Gap Model" for services. While satisfaction with individual transactions does not lead to customers' perceptions of high quality, Customer Satisfaction as a major ingredient of quality is explicitly recognized in the criteria for the Malcolm Baldrige National Quality Award. 3. Empirical Findings Regarding Customer Satisfaction According to IBM, a "closed loop" is needed to overcome dissatisfaction. IBM claims to have quantified the revenue potential of one point of customer satisfaction, while AT&T has obtained weights for the components of customer satisfaction. According to AT&T, Satisfaction with Repair Quality is a direct function of "fixed right first time". Burke Research bemoans the lack of actionability in Satisfaction Measurement and also maintains the need for a "closed loop" from measurement to action. 4. Problem Detection and Complaint Resolution Dissatisfied individuals tend not to complain, and retail and field systems filter and discourage complaints. By the mere fact of getting customers to articulate their problems to the company/provider, brand loyalty can be retained and the complaint ratio (multiplier) reduced. The propensity to complain is directly proportional to the perceived severity of the problem and the damage to the respondent. Complainers tend to be the heaviest users of the product/service. Problem experience for those consumers who remain unsatisfied results in substantial amounts of negative word-of-mouth. The author closes with ten -10 recommendations for the design of automotive Customer Satisfaction programs.
BMW (GB) Limited has been conducting Customer Satisfaction studies among new car buyers in Great Britain for about eight years. The prime objective of these studies has been to assess the strengths and weaknesses of both the product and the service provided by BMW dealers through the eyes of their customers. Whilst drawing on the buyer survey for contextual infonnation the main focus of this paper is on a Dealership Study. BMW (GB) Ltd has a network of 155 dealers throughout Great Britain, owned by a total of 114 individuals or organisations. The dealerships are almost all independent of BMW (GB) Ltd, with whom they have a contract to sell BMW cars and parts, offer servicing and repairs, including work carried out under warranty. Customer satisfaction at the Dealer level is perceived by the company as a fundamental requirement of business success. The self imposed commitment is that customer satisfaction must extend through the total ownership er-tperience for all branded products and services. The elements of the partnership between manufacturer and dealer are clearly different from those between dealer and end user but, equally important. The independent nature of the relationship, if the dealers are to retain confidence in the competence of the GB management, serves to intensify the importance of the study in measuring company progress, identifying trends and correcting elements of the relationship that are going wrong. Over the past five years, therefore, BMW has applied Customer Satisfaction research to itself. The study is designed to back-up company thinking and provide the hard numbers helpful for proactive management. Our paper will describe (briefly) how we conduct a census of dealers, some of the more important findings, how the data has been used to implement change and the affect of that action on Dealer Satisfaction levels.
The primary purpose of a Market-Based Decision Network is to provide information and process tools to enterprise and operating management. It is a team of experienced people positioned to assist all levels of management by creating a set of processes and systems that encourage the identification and creation of information for use in knowledge creation for business decisions. The basis for an Enterprise Market-Based Decision Network is the recognition that however competent an enterprise is at collecting and analyzing information, the TRUE value of the information is developed in the minds and in the actions of decision makers and not in the mere collection of information. This added value is tangibly demonstrated in the creation of products and services of high integrity and customer satisfaction. Therefore, a requirement of market leadership is acquiring the best information possible, relating it to what the enterprise knows it is capable of doing, and making sure all functions within the enterprise use both types of knowledge to make quality decisions better than any other company.
This paper questions some of the conventional approaches and ways that many manufacturers look at and use customer service research, in particular, Customer Service Monitors: The use of vague 'scales' to measure performance. The way the importance of different aspects of service is measured The way some Customer Service Monitors fail to reflect importance weighting It also looks at how mystery shopping and Customer Service Monitors (CSM's) results combined can be more useful to dealers and how integrated indices using CSM data, mystery' shopping data and internal performance data can provide an overall Customer Service Index which can give a clearer guide to dealers on how they are performing in terms of service delivery.
In today's high-tech, high-speed markets, as organizations seek more effective ways to reach and hold increasingly unreachable and untenable customers, the application of information technologies (IT) to the processes of marketing has become an important source of competitive advantage. This new marketing involves relationships, networks and continuous interactions. Information technology is not new. What is new is the digital revolution and the convergence of three IT streams: computers, consumer electronics and telecommunications. What is also new is IT's growing pervasiveness into virtually every aspect to do with running a business. In effect, IT has moved from the back end of the business system to the front end - from the accounting department to the process of research and development and thence to the production floor, to the marketing and selling functions, and finally to customer servicing. For some firms, IT has become the aspect of the relationship that customers value most, as the lines between the firm and its dealers and customers get blurred into a smooth, "seamless" network of relationships that are the result not just of fundamental changes in the processes of marketing, but the processes of doing business itself. The objectives of this paper are to: 1. Examine some of the ways in which information technologies are fundamentally changing the processes of marketing; 2. Present a "model" of how tomorrow's information intensive automobile manufacturer is likely to undertake its "relationship marketing" activities; 3. Suggest some important implications for various organizational functions, including marketing, market research, advertising, selling and servicing. One might ask: "Why will we need these as separate functions?"
The aim of this paper is to describe how new methods based around information and geographical technology can be used to help auto manufacturers better understand the markets for their products, their performance within those markets and to assist in planning for the future. We shall support the argument through the development of a framework which both maximises the use of information by generating intelligence (used more in the military sense rather than the A.I. sense) through the use of mathematical models of markets. The need for such a framework in the auto industry is generated by a number of convergent trends that are taking place on a global scale. These are discussed in more detail below. However the simple truth is that when it comes to analysing markets and planning for future action manufacturers have to get smart by using the best available information technology to support their efforts. Then they have to get smarter by using tools that will allow them to accurately predict the consequences of alternative actions. Finally, there is the opportunity to become the smartest by developing approaches that will provide the best answers to strategic and tactical questions, for example how should the dealer network be organised in the future to maximise market share and profitability. Examples of hew these objectives can be achieved are provided later. One of the main aims of the paper is summarised in part of the title - eliminating the emotion from planning in areas surrounding the new car market. In the author's experience the careful use of information and intelligence can allow an understanding of how the market works and how best to respond to it based on hard evidence.
Our paper discusses the importance of image in the automobile industry. It begins by ascertaining how much money manufacturers typically spend in advertising, then other related communications disciplines. It is a substantial amount. We proceed to a discussion of the definition of the word image, and bring the latest perspective on the subject relevant to the late 1990's. We conclude that image as the customer perceives it, and the soul of a company, are essentially inseparable over time. A company that needs to change its image first needs to change its soul. Peugeot and Renault in Europe, and Chrysler in the U.S., are frequently discussed as helpful examples. We then provide a few guidelines about how to maintain a positive image. Looking into the future, we propose Chrysler as an example of the most advanced car company in positive image-building. We draw the lessons for Europe, which to us speak for open markets, free distribution channels, and minimal protectionism.
The car market has a remarquably high proportion of loyal customers. About 50 % of new car buyers choose for their new car the same brand as for the previous one. However, the economic and competitive situation may iead to an erosion of this figure. "Brand equity" may well be diminished in that sense. The goal of this paper is to analyze factors that lead to brand disloyalty. What are the elements in the consumer situation, in his permanent characteristics, in his product experience, in his general attitudes towards automobiles that are likely to lead him to switch to another brand? In order to analyze this problem, we have chosen to study a large number of variables, belonging to several categories (This paper is derived from a larger study on pre- purchase information gathering.). This allows us to assess the predictive power of multiple approaches. Of course, the price to be paid is the relatively small size of the sample, namely 1,008 recent purchasers of a new car. For the analysis reported in this paper, we excluded persons who had no previous car, as brand loyalty or disloyalty obviously cannot be observed in this case. This let us with 981 purchasers.
There are a number of trends both within and outside the automotive industry which suggest that the current rather monolithic brand structure of the car industry' may soon change dramatically. Modern management techniques encourage structural diversity within an organisation and a tendency to increase the number of brands held by an organisation. Increased flexibility in car manufacturers' model ranges driven by customer needs, also lead to a great diversity of product, many of which may require the creation of sub-brands. Finally, changes in consumer behaviour will require the car manufacturers to increase their influence within the life of the consumer, spreading their activities and again giving rise to brand diversification. The common result of all the above is the potential for an explosion of brands. The paper proposes a number of measures designed to address some of the problems that this would engender. In an age of change, brands must also change, the challenge for tomorrow is the management of brand change.