Automotive Customer Experience: Are Auto Dealer Incentives Muting the Voice of the Customer?

Shifting focus from auto dealer incentives and survey scores to listening to feedback and acting on it helps brands truly optimize the automotive customer experience.

The automotive industry has always been aware of the importance of customer satisfaction. Expensive transactions require attention to customers and their needs. Consider the emphasis placed on scores and rankings by most of the automotive brands. Every year customer satisfaction studies are released, and winning automotive brands communicate results to consumers through marketing channels. 

But with all this focus, why do consumers continue to complain about the car-buying process? Why are disruptors so beloved by consumers who use them? After all these years, shouldn’t the automotive customer experience be seamless by now?

After over 30 years of working in the automotive business, I have seen initiative after initiative attempt to solve for customer experience, only to miss the true mark. As disruptors shape the industry and the pandemic accelerates the digital transformation already underway, automotive brands are at yet another crossroads today to reprioritize the customer experience. But, the strategy needs to move beyond just the scores. The industry is at another turning point to truly listen to the voice of the customer and take action.

The truth behind automotive customer satisfaction scores

How could the industry place so much emphasis on customer satisfaction scores yet offer a customer experience that many consumers still complain about? Focus. For too long now, the focus has been on customer satisfaction scores coupled with auto dealer incentives! 

On paper, incentivizing dealers and salespeople on customer satisfaction scores seemed like a great idea and a way to ensure that customer satisfaction is prioritized. But scores became the priority and true experiences are forgotten about — because dealer employee livelihoods have depended on them, and paying for scores is inherently problematic. 

In fairness, automotive manufacturers have pushed dealers to genuinely improve their processes and to make the car-buying process easier and more efficient for customers. And, many automotive brands either have moved away or are slowly moving away from score-based incentives to focus more on behavioral incentives that foster engaging in customer experience rather than score chasing. 

The conundrum: Scores may go up, but the true experience remains the same. The buying process has not kept up with customer expectations. Survey score manipulation and coaching of customers are known tactics that help to pad scores. We have all heard the stories after taking delivery of a new car, a salesperson will say, “Please make sure you give me a 10 on the survey or little Johnny will not be able to eat” — or any other of the dealer’s top survey coaching lines. That means it’s difficult to paint a clear picture of the automotive customer experience. 

Disruption and the digital transformation: Time to adapt

Enter disruption. Whether it is Carvana, Tesla or the like, there are options for buying vehicles that are more aligned with the ever-increasing population who wants to shop and purchase a vehicle (hint: it’s not just millennials) in a digital format. Yes, there is still tire kicking and test driving, but many customers want an end-to-end digital experience. 

Think about all the benefits consumers have when they shop online: transparency on price, condition and availability, convenience of not needing to spend an entire day to purchase at a dealership, and less pressure from salespeople and negotiation tactics — all things that translate to a better customer experience. For example, someone recently told me that he purchased a car from one of the online disruptors and loved the experience. He then took his primary vehicle to the dealership for service. By stark contrast, he said the dealership service experience felt the same as it did 20 years ago, except the building was newer.

In fact, the COVID-19 pandemic has given rise to the digital automotive marketplace. When the pandemic first hit the U.S., dealerships felt the initial pinch of lost business due to consumers staying home. Consumers turned to a new way to shop, and online car buying increased. Much like the way Buy Online/Pickup Curbside in the retail space is changing customer behavior beyond the pandemic, online car buying is expected to stick. Consumers have reported in recent industry surveys that they are more satisfied with the price they paid online for a car versus the price they receive via traditional negotiation methods used at physical dealerships. Customers were also more likely to purchase add-on services such as extended warranties and tire protection when they could review the offerings online.

The lesson? There are dealers that have done an exceptional job at adapting to the changing needs and wants of their customers. As many of the brands saw sales drop off at the start of the pandemic, they shifted gears to prioritize the customer experience preparing for the new normal. Simply put, they listened to customers and then acted.

So, what’s the solution?

In order to build customer relationships that matter, automotive brands must focus on what customers are saying and not only how they are scoring on satisfaction surveys. Dealer incentives that depend on scores only serve to blur the focus. Scores do not provide feeling or sentiment; words do.

Some brands are reexamining customer experience incentive programs at dealerships. Why has it taken so long, and why aren’t more doing it? Risk. What if my ranking falls? What if the internal scores/metrics fall? Will dealers still focus on customer experience if they aren’t paid? What if vehicle sales fall?

While these are all valid concerns, the provocative question is: Given the continuing disruption, will the auto industry take the opportunity to rethink score based strategies and invest in technology to evolve with customer expectations? In order to better understand what automotive customers are looking for, industry leaders are looking for richer feedback throughout the customer journey. 

Rather than simply asking customers a standard set of questions after they purchase or service their car, brands can “capture signals” throughout the entire ownership experience. These additional signals include direct feedback at key touch points before the purchase and indirect signals captured from social media, website interactions, contact center and finance department conversations, and more.

Technology is the key to managing all of this data across speech, digital, video, surveys, and social media. Not only can the latest technology collect insights in one place, but it can help brands and dealers make actionable decisions and communicate with customers in real time, bringing the customer experience to the forefront — not just the score. The result is a clearer picture of customer satisfaction, a true understanding of pain points that need to be addressed, and a more seamless experience that works for both the customer and industry.

Interested in learning more about how a customer experience strategy can work for you? Connect with a Medallia Expert on Demand, where you have direct access to our experts who will guide you to strategies that can help your organization emerge stronger than ever.