J.D. Power: Customer Satisfaction with the New-Vehicle Sales Experience Improves Significantly

Efforts by automakers and franchised dealers to improve buyers’ satisfaction with the new-vehicle sales process is paying dividends based on the results of the J.D. Power and Associates 2011 U.S. Sales Satisfaction Index Study.

The SSI Study released on Thursday showed consumer satisfaction improved notably from 2010.

Among buyers, analysts explained satisfaction is examined across four measures, which they listed in order of importance. Coming out on top was working out the deal (17 percent) followed by salesperson (13 percent), delivery process (11 percent) and dealership facility (10 percent).

Among rejecters, J.D. Power indicated satisfaction is examined across five measures, again listed in order of importance. Topping this cluster was the salesperson (20 percent) followed by fairness of price (12 percent), facility (6 percent), inventory (6 percent) and experience negotiating (5 percent).

J.D. Power determined overall sales satisfaction averaged 648 on a 1,000-point scale this year, improving by 13 points from an average of 635 a year ago.

Analysts believe this gain suggests that, as market conditions improve, manufacturers and dealers are placing renewed focus on and investment in providing buyers with satisfying retail experiences.

J.D. Power went on to mention all measures improve notably from last year with the greatest gain in the delivery process, despite the fact that the average length of time to complete the delivery portion of a new-vehicle sale has increased by four minutes to an average of 32 minutes this year from an average of 28 minutes in 2010.

Overall, the average length of time a buyer spends at the dealership has increased by 11 minutes, to an average of 4.3 hours this year from 4.1 hours last year.

J.D. Power discovered a primary reason for the lengthened delivery process is the increasing proportion of buyers who are receiving more in-depth demonstrations of technology in their new vehicle (including audio, entertainment, navigation and communications systems).

Approximately 88 percent of buyers who made a purchase this year told J.D. Power they received a technology demonstration at vehicle delivery.

“Although technology demonstrations add time to the delivery process, those explanations substantially improve satisfaction, as well as customer loyalty and advocacy,” explained Jim Gaz, director of automotive research at J.D. Power.

“It would intuitively seem that buyers are most satisfied when the sales process is completed in the shortest amount of time possible,” Gaz continued.

“However, buyers actually appreciate it when sales staff spends additional time with them, as long as that time provides them with added value,” he added.

According to Gaz, an increasing proliferation of technology demonstrations may also help improve perceptions of new-vehicle quality.

The J.D. Power U.S. Initial Quality Study (IQS) has found that rates of owner-reported problem incidence with audio/entertainment/navigation technology systems have increased steadily between 2009 and 2011.

Some of these perceived problems may stem from users not understanding how to operate features, so technology demos provided by sales staff can be a powerful tool in lowering problem rates and improving satisfaction with vehicle design.

Which Brand Topped Study Rankings?

After sharing the overall readings, J.D. Power delved into which brand fared best in the Sales Satisfaction Index Study

Lexus ranked highest among luxury brands in satisfaction with the new-vehicle buying experience. Cadillac and Mercedes-Benz followed in the luxury-brand segment rankings.

The luxury brands with the greatest improvement from 2010 are Lincoln (moving from ninth rank position to sixth) and Audi (moving from 11th rank position to ninth).

Mini ranked highest among mass market brands for a second consecutive year. Buick and GMC, respectively, follow Mini in the mass market segment rankings.

Analysts pointed out the mass market brands with the greatest improvement from 2010 are Volkswagen (moving from 13th rank position to fourth), Scion (moving from 11th rank position to fifth) and Nissan (moving from 18th rank position to 12th).

In reacting to Thursday’s announcements, Toyota officials stated, “We are pleased with the improvement off all three of our brands in the 2011 J.D. Power and Associates Sales Satisfaction Index (SSI) study.

“The Lexus brand improved its score over last year and ranked as the top premium nameplate. Both Toyota and Scion showed significant improvement and each placed higher in the rankings and above the industry average,” they continued.

“Credit must go to our dealer body for their investment in upgrading many of their facilities and their dedication to satisfying their customers,” Toyota management insisted.

“Sales satisfaction is more important than ever, and we will continue work with our dealers to find ways to increase the quality of the sales experience for all of our customers,” the Japanese OEM went on to stress.

J.D. Power reiterated its SSI Study is a comprehensive analysis of the new-vehicle purchase experience and measures customer satisfaction with the selling dealer (satisfaction among buyers).

The analysis also measures satisfaction with brands and dealerships that were shopped but ultimately rejected in favor of the selling brand and dealership (satisfaction among rejecters).

The 2011 U.S. Sales Satisfaction Index (SSI) Study is based on responses from 24,045 buyers who purchased or leased their new vehicle in May. The study was fielded between August and October.