Big Three try harder than ever to make customers happy
Thursday, February 08, 2007
Chicago Auto Show
Big Three try harder than ever to make customers happy
Sharon Terlep / The Detroit News
CHICAGO -- Never before have consumers been so courted by Detroit's automakers.
Now more than ever, the companies that once ruled the American car market almost by default have to fight to win over shoppers being wooed by a fast-growing legion of foreign rivals.
That competition is grinding away at Detroit's Big Three, evidenced by the financial turmoil engulfing General Motors Corp., Ford Motor Co. and DaimlerChrysler AG's Chrysler Group.
But if there's a bright side to the troubles, it's that people in the market for a new car or truck will find themselves deluged with attractively priced options better tailored to meet their specific needs.
This consumer-minded strategy is on display this week at the Chicago Auto Show, where Detroit automakers have announced everything from the revival of a once-beloved brand name to the launch of a sales strategy that includes letting potential buyers test drive a vehicle from their home.
New tactics tried
More broadly, automakers are employing technology and new tactics to find out exactly what it is that buyers want. Chrysler, for example, sends researchers out to watch how real people use their vehicles to gain insight into how to make improvements.
"The standard that used to satisfy people 10 or 12 years ago is completely unacceptable today," GM product czar Bob Lutz said on Wednesday in an interview during the auto show's media preview. "And if consumers aren't happy, there's plenty of places they can go."
Domestic automakers, while making major strides in fixing quality problems that helped drive consumers to foreign makers, still battle image problems. Executives at each of the Detroit automakers have said they can't just match product being churned out by Japan's Toyota Motor Corp. and Honda Motor Co. -- they have to do better.
Striking a chord with potential buyers is a key part of that strategy.
Appealing to customers is important enough to GM that the company on Wednesday rolled out an entirely new customer service strategy at its Saturn brand.
Saturn dealers will now deliver a vehicle to a consumer's home or office so it can be taken for a test drive. Some individual dealers have already adopted the practice, but Saturn will be the first brand to do so on a large scale.
Help available 24 hours
Saturn also will now have representatives available to chat online 24 hours a day with anyone looking to buy or with questions about a vehicle they already own.
"We really looked at what great brands are doing to differentiate themselves in the marketplace," Saturn General Manager Jill Lajdziak said, pointing to industry giants such as Starbucks Coffee Co. and Apple Computer Inc. Flawlessly aligning their product with consumer demands is a strength of both companies, she said.
More Saturn-like approaches are likely on the way from Detroit carmakers, said Joseph Phillippi of AutoTrends Consulting in Short Hills, N.J. The fact that the U.S. car market is relatively stagnant means competition between brands is likely to heat up.
"How do you win back market share?" he said. "You continually have to throw new ideas into the market to at least have a shot.
"This is the classic case of the oft-noted axiom, 'It takes one bad car to lose a customer but it takes you massive amounts of money to win that customer back.' "
Winning over customers has always been a goal for automakers, but it's getting more difficult as the competition increases. More than 350 models are sold in the United States today, a 50 percent increase in just seven years.
"This hypercompetitive environment, it's going to make you do things you wouldn't have done before," said Cisco Codina, head of marketing, sales and service for Ford in North America.
Keeping its customers happy was part of the motivation behind Ford's decision, announced Wednesday in Chicago, to rename the Five Hundred sedan Taurus.
The decision was partly fueled by auto dealers who said their customers missed the Taurus.
Ford did a market study and found that more than twice as many people recognized Taurus than the Five Hundred, and most had a positive impression.
"When you have such a crowded marketplace, you have to have a more articulated message," Codina said. "The problem is, how far do you go?"
At Chrysler, the company is trying to be hyper-sensitive to customers. Last year it began having people watch unwitting drivers in their vehicles -- someone trying to load groceries into a trunk, for example. It also sends engineers and marketing staff to speak with owners about what they like and don't like about their vehicles.
"As there's more competitors and more market segmentation, you've got to be more precise," said Frank Klegon, Chrysler's vice president of product development. "It's not just 'I think blue is the favorite color' anymore. You've got to get objective data and apply that."
You can reach Sharon Terlep at (313) 223-4686 or sterlep@detnews.com.
© Copyright 2007 The Detroit News. All rights reserved.
Chicago Auto Show
Big Three try harder than ever to make customers happy
Sharon Terlep / The Detroit News
CHICAGO -- Never before have consumers been so courted by Detroit's automakers.
Now more than ever, the companies that once ruled the American car market almost by default have to fight to win over shoppers being wooed by a fast-growing legion of foreign rivals.
That competition is grinding away at Detroit's Big Three, evidenced by the financial turmoil engulfing General Motors Corp., Ford Motor Co. and DaimlerChrysler AG's Chrysler Group.
But if there's a bright side to the troubles, it's that people in the market for a new car or truck will find themselves deluged with attractively priced options better tailored to meet their specific needs.
This consumer-minded strategy is on display this week at the Chicago Auto Show, where Detroit automakers have announced everything from the revival of a once-beloved brand name to the launch of a sales strategy that includes letting potential buyers test drive a vehicle from their home.
New tactics tried
More broadly, automakers are employing technology and new tactics to find out exactly what it is that buyers want. Chrysler, for example, sends researchers out to watch how real people use their vehicles to gain insight into how to make improvements.
"The standard that used to satisfy people 10 or 12 years ago is completely unacceptable today," GM product czar Bob Lutz said on Wednesday in an interview during the auto show's media preview. "And if consumers aren't happy, there's plenty of places they can go."
Domestic automakers, while making major strides in fixing quality problems that helped drive consumers to foreign makers, still battle image problems. Executives at each of the Detroit automakers have said they can't just match product being churned out by Japan's Toyota Motor Corp. and Honda Motor Co. -- they have to do better.
Striking a chord with potential buyers is a key part of that strategy.
Appealing to customers is important enough to GM that the company on Wednesday rolled out an entirely new customer service strategy at its Saturn brand.
Saturn dealers will now deliver a vehicle to a consumer's home or office so it can be taken for a test drive. Some individual dealers have already adopted the practice, but Saturn will be the first brand to do so on a large scale.
Help available 24 hours
Saturn also will now have representatives available to chat online 24 hours a day with anyone looking to buy or with questions about a vehicle they already own.
"We really looked at what great brands are doing to differentiate themselves in the marketplace," Saturn General Manager Jill Lajdziak said, pointing to industry giants such as Starbucks Coffee Co. and Apple Computer Inc. Flawlessly aligning their product with consumer demands is a strength of both companies, she said.
More Saturn-like approaches are likely on the way from Detroit carmakers, said Joseph Phillippi of AutoTrends Consulting in Short Hills, N.J. The fact that the U.S. car market is relatively stagnant means competition between brands is likely to heat up.
"How do you win back market share?" he said. "You continually have to throw new ideas into the market to at least have a shot.
"This is the classic case of the oft-noted axiom, 'It takes one bad car to lose a customer but it takes you massive amounts of money to win that customer back.' "
Winning over customers has always been a goal for automakers, but it's getting more difficult as the competition increases. More than 350 models are sold in the United States today, a 50 percent increase in just seven years.
"This hypercompetitive environment, it's going to make you do things you wouldn't have done before," said Cisco Codina, head of marketing, sales and service for Ford in North America.
Keeping its customers happy was part of the motivation behind Ford's decision, announced Wednesday in Chicago, to rename the Five Hundred sedan Taurus.
The decision was partly fueled by auto dealers who said their customers missed the Taurus.
Ford did a market study and found that more than twice as many people recognized Taurus than the Five Hundred, and most had a positive impression.
"When you have such a crowded marketplace, you have to have a more articulated message," Codina said. "The problem is, how far do you go?"
At Chrysler, the company is trying to be hyper-sensitive to customers. Last year it began having people watch unwitting drivers in their vehicles -- someone trying to load groceries into a trunk, for example. It also sends engineers and marketing staff to speak with owners about what they like and don't like about their vehicles.
"As there's more competitors and more market segmentation, you've got to be more precise," said Frank Klegon, Chrysler's vice president of product development. "It's not just 'I think blue is the favorite color' anymore. You've got to get objective data and apply that."
You can reach Sharon Terlep at (313) 223-4686 or sterlep@detnews.com.
© Copyright 2007 The Detroit News. All rights reserved.
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