Car buyers consider the total sales-and-service package when deciding to buy
The way customers are treated by the dealership is more important to overall new-vehicle buyer satisfaction than the actual transaction price, according to the 2010 U.S. Sales Satisfaction Index Study from J.D. Power and Associates, a Westlake Village, Calif., research company. For the study, overall customer satisfaction was measured across four factors: working out the deal; salesperson; delivery process; and dealership facility.
Over one-half of new-vehicle buyers cite dealer treatment as a reason to purchase their new vehicle from a specific dealer. In comparison, 38 percent of buyers cite vehicle price or the deal offered as the reason for selecting their dealer. Furthermore, once the dealer is selected, the ease of coming to an agreement on the final vehicle price has the single-greatest influence on buyer satisfaction, surpassing the importance of fairness of the actual price paid. With the exception of selecting a vehicle, negotiating the deal is the aspect of the new-vehicle buying process that takes the longest time (53 minutes, on average).
The study also finds that 60 percent of new-vehicle buyers visit more than one dealership during the shopping process. While many dealers are rejected for not having a vehicle that the buyers wanted to purchase, a significant number of buyers (18 percent) end showroom visits primarily due to poor customer treatment by the dealer’s salespeople. While some new-vehicle buyers complain about dealer sales staff applying too much sales pressure, an equal proportion complain about receiving insufficient attention from salespeople. Other frequently-mentioned complaints include dealer staff being discourteous or not being straightforward with the buyer.
For a third consecutive year, Jaguar ranked highest among luxury brands in satisfying buyers with the new-vehicle buying experience. Jaguar performed particularly well in the salesperson and working-out-the-deal factors. Cadillac and Mercedes-Benz followed in the luxury brand segment rankings. These two brands also ranked second and third, respectively, in 2009. Among luxury brands, Lincoln demonstrated the greatest improvement from 2009, moving from sixth rank position to fourth in 2010.
MINI ranked highest among mass-market brands, performing particularly well in dealership facility, salesperson and delivery process. Mercury and GMC followed MINI in the mass-market segment rankings. The mass-market brands demonstrating the greatest improvement from 2009 were Hyundai (moving from 16th rank position to seventh in 2010) and Chrysler (moving from 15th position to eighth in 2010).
The Internet continues to play an increasingly important role in the new-vehicle shopping process, with more than three-fourths of new-vehicle buyers using the Internet during the shopping process. Twenty-four percent of buyers in 2010 submitted an online request for quote to a dealer and were, on average, more satisfied with the negotiation process and the price paid. However, perhaps expecting a quicker sales process, these buyers were more likely to express dissatisfaction with the length of the sales process than buyers who did not submit an online request.
“Dealers need to streamline the new-vehicle buying process for customers who do a lot of research online,” says Jon Osborn, director, automotive research, J.D. Power and Associates. “These buyers tend to be affluent, well-informed and time-sensitive. They generally know the exact vehicle they want and how much they expect to pay for it. Despite often having little familiarity with the dealership they are buying from, they want to get in and out as quickly as possible. Dealers need to balance respect for the customer’s time while still providing what the customer needs.” For more information visit www.jdpower.com.
The average global consumer is worried, broke
Despite talk of the recession being a thing of the past, consumers found a full economic recovery in 2010 to be highly unlikely, as consumer confidence declined in 19 of 53 global markets according to the third-quarter 2010 Nielsen Global Consumer Confidence Index from New York researcher The Nielsen Company. One in four North Americans and one in five Europeans had no discretionary income. Rising food prices were a top concern for one in four Asians, whereas increasing utility prices were Europeans’ biggest concern. Recovery is back on track in Northwest Europe, while the recessionary mind-set lives on in Southern Europe. Nine of the top 10 most confident nations hail from the Asia-Pacific region.
After an upbeat start to 2010 with two consecutive quarters of increased optimism, global consumer confidence fell three points in September to an Index of 90. Consumer Confidence Index levels above and below a baseline of 100 indicate degrees of optimism and pessimism. The 90 Index mark reflects that consumers around the world were largely pessimistic about job prospects, personal finances and their ability to buy the things they want and need over the next year.
For many consumers, spending on non-essential goods was more restrained last year compared to the height of the global recession two years ago. Discretionary income reached an all-time low for many consumers in the third quarter, with 27 percent of Americans, 19 percent of Europeans, 17 percent of Middle Easterners/Africans and 16 percent of Latin Americans left with no spare cash after paying essential living expenses.
In addition to economic issues, many consumers in Asia and Europe grappled with additional concerns such as rising food and utility prices, which squeezed already-constrained family budgets. In Europe, increasing utility bills replaced the economy as the No. 1 concern over the next six months, and in Asia-Pacific, one in five consumers were most concerned about rising food prices, an increase of 13 points over the second quarter of 2010.
The economy remained the No. 1 concern for 27 percent of North Americans and worries about health jumped 5 percent. Health is now the No. 1 concern for 10 percent of respondents in North America. Among Latin Americans, consumers ranked work/life balance, job security, debt, crime and children’s education ahead of the economy as the No. 1 concern. For more information visit www.nielsen.com.
Older workers use social networking for business but still have faith in traditional meetings
Professional behaviors and attitudes among different generations vary greatly, and it isn’t only the difference between who’s on LinkedIn and who’s still using a Rolodex. On the whole, younger generations put less stock in in-person meetings and meetings in general, but they’re not the ones rushing to collaborative technologies and social media to get the job done. Gen X workers - and not their younger Gen Y counterparts - make up the majority of those who use social networking for business, followed closely by Boomers ages 55+, according to a global study conducted by Forrester Research, Cambridge, Mass., on behalf of Citrix Online, a Santa Barbara, Calif., software company. The study asked information workers of all ages in the U.S., U.K., France, Germany and Australia about their business communication habits.
The study showed that older generations - not Gen Y - have a monopoly on technology use and social tools during the work day. Gen Y is least likely to share information via text message (26 percent of Gen Y vs. 47 percent of those 55+) and least likely to use videoconferencing, videochat and Webconferencing tools. Gen Y uses social networking the least frequently (40 percent of Gen Y workers who use social media for business do so daily vs. 50 percent of those 55+). Older Boomers have increased their business use of social media 79 percent in the past year. Use is on the rise overall, with 64 percent of those who employ social networking tools in business doing so more than the previous year. Videochat, team document-sharing sites and Web conferencing also experienced significant increases in usage, at 56 percent, 55 percent and 52 percent, respectively.
Social networking may help make work more efficient but the traditional office meeting is far from obsolete, despite widespread disenchantment with meetings. Eighty-four percent of all respondents have in-person meetings, although meetings often don’t achieve their goals. Only 45 percent are very satisfied that planning meetings achieve the task at hand, and only 30 percent believe such meetings to be very efficient. Across all categories of meetings for designated tasks (e.g., review of documents, plan projects or initiatives, decision on a course of action, etc.), less than half of respondents believe those meetings are very efficient.
Additionally, the younger you are, the less you value meetings and pay attention during them. Gen Y is least likely to think meetings are efficient, and only 29 percent of Gen Y workers think meetings used to decide on a course of action are very efficient, compared to 45 percent of older Boomers. Gen Y is also least likely to pay attention in meetings, as barely half believe it’s very important to do so in meetings to decide on a course of action.
In America, however, perhaps contrary to conventional wisdom, workers have more meetings but pay more attention instead of less. Ninety percent of Americans meet in person to communicate and build relationships, more than any other nationality. Of that 90 percent, 51 percent meet daily, compared to a mere 31 percent of French. Seventy-five percent of Americans believe it’s very important to pay attention in meetings to decide on a course of action, compared to 50 percent of the French. For more information visit www.forrester.com.
Canada scored a coup in 2010 ranking of country-as-brand
The 2010 country brand rankings are in, and it takes more than a high GDP to get to the top - or stay there. In fact, the commerce and manufacturing meccas of the world are markedly absent from the highest-ranked countries. While many believe strong economic performance is vital to brand strength, it is not enough to guarantee a high world ranking. It is much more - a strong country brand should make peoples’ lives better through safety, stability and political freedom.
New York research company FutureBrand’s Country Brand Index annual study is a global quantitative research study with 3,400 international business and leisure travelers from 13 countries on five continents, qualified by in-depth expert focus groups that took place in 14 major metropolitan areas around the world. The strength of a country brand is determined by measures of awareness, familiarity, preference, consideration, advocacy and active decisions to visit. However, the most important factors that truly differentiate a nation’s brand are its associations and attributes, which the study measures these in five dimensions: tourism; heritage and culture; value system; quality of life; and good for business.
The leading countries for 2010 country brands share some common features. They are all democratic; progressive; relatively politically and economically stable; and do business in English. As ever, there are rising and falling stars, but position is not the whole story. Themes emerged in 2010 that hint at future drivers of country brand strength, including the importance of value systems and the freedom of communications.
2010’s weakest country brands struggled variously with political instability, security concerns, corruption, economic turmoil, natural disasters and high levels of state control, all of which confirm an unavoidable correlation between perceived brand strength and political, social and economic realities in the world’s most challenged countries. As a group, these country brands performed poorly in the assessed dimensions of tourism and value system. But it is important to consider that low awareness remains a strong part of the problem for these country brands, rather than merely negative associations. The best country brands have strong sense of identity, developed over time and presented consistently across touchpoints, which is critical to brand success of any kind. Country brand strength is a nation’s ultimate intangible asset and goes beyond its geographic size, financial performance or levels of awareness.
Rising from second to first place, brand Canada displaced the U.S. in a coup that mirrored its ice hockey gold-medal win at the Vancouver Winter Olympics. In fact, as host of the Games, Canada not only secured a record number of gold medals but delivered a successful event overall - a fact that must have helped its image as a safe, friendly, fun, world-class country. All things considered, it is perhaps not surprising that Canada enjoyed increased awareness and visitation scores this year. But paradoxically, while Canada performed consistently well across every country brand index measure, it failed to achieve the highest rank in any category - unlike its rival the U.S., which continued to dominate when it came to consideration and other scores.
The U.S. fell from the top spot in 2009 to fourth in 2010, showing that the Obama effect can work both ways. Just as its rise to the top spot in 2009 reflected global attention, hope and anticipation of change promised by the new administration, the U.S. suffered in parallel with the waning approval ratings of President Obama. This could indicate that brand U.S. was artificially stimulated by the charisma of an individual, masking some of the U.S.’s challenges in the wake of the global economic crisis. With unemployment nearing double figures and a slower-than-predicted recovery, the world’s largest economy has also been affected by the Gulf of Mexico disaster and sustained criticism over foreign policy. Brand U.S., however, continues to communicate strong and desirable values in everything from popular culture and entertainment to food and retailing brands.
The economic crisis was also a powerful factor in country brand strength in 2010, but mainly for those that avoided it. The top three brands managed to escape the worst of the banking collapse and maintain relatively strong economies throughout 2010. Australia and New Zealand both enjoyed consecutive-quarter growth thanks in part to continuing demand for commodities like iron ore, timber and milk from China. Canada also showed strong performance among the G7 nations, being the last into recession and the first out, not least thanks to fiscal conservatism that helped it to avoid the sub-prime crisis. Other countries that fell in the rankings - notably the U.S. and the U.K. - have both suffered conspicuously as a result of high-risk ventures and the banking collapse.
Perhaps most interestingly in 2010, the top-20 performance of Sweden, Finland, Norway and Denmark revealed a strong emerging preference for brand Scandinavia across the world. From Denmark’s role as the host of the Copenhagen Summit to Sweden’s internationally-renowned welfare state, brand Scandinavia represents a commitment to freedom, well-being, global citizenship and quality of life that unites these Northern European countries in people’s perceptions.
As a rising star in 2010 - moving from 21 to 10 - Sweden in particular cultivated very strong perceptions around the dimensions for value system and quality of life. Specifically, Sweden performed well in attributes such as environmental friendliness, education and health care system, which are all ranked at number two. The strong performance of brands like the airline SAS that bring Scandinavia together shows the power of unifying individual country brands behind regional flag-carriers or corporations that represent common values.
Among the other rising stars of 2010, Chile (No. 40, up 19 spots) improved across every measure with huge leaps in awareness and advocacy, as well as in perceptions of political freedom. The San José miners’ rescue became a global news event generating extraordinary goodwill for President Pinera and brand Chile. This, coupled with growing economic stability, makes Chile a brand to watch in the region. With significant marketing investment for tourist destinations, Israel (No. 30, up 11 spots) moved in the right direction, particularly in tourism metrics like authenticity and history, which align with campaigns promoting heritage and culture. Argentina’s scores (No. 33, up 10 spots) were up across the board, namely for advocacy. After a quarterfinals position in the World Cup and significant GDP growth in the first half of 2010, Argentina became the first Latin American country to legalize same-sex marriage, a move signaling a triumph of liberal values in the region.
Greece (No. 22, down 8 spots) presented the most conspicuous shift, set against a high-profile financial crisis and subsequent industrial relations problems following government spending cuts and tax increases. Associations of Greece as a tourist destination are traditionally strong in this study, but during sustained periods of bad news - affecting confidence around core services and infrastructure - consideration and advocacy were threatened.
India (No. 23, down 5 spots) was another falling brand, straight off the back of negative global media coverage of health and safety concerns at the 2010 Delhi Commonwealth Games, as well as tourist attacks leading up to the event. The Olympic effect seems not to have lasted long for China (No. 56, down 8 spots), with 2010 bringing public relations challenges around post-Copenhagen environmental impact and high-profile censorship battles with Google. Significant decline in perceptions of political freedom contributed most to the drop in the rankings. A fall for China despite its promotion to the second-largest economy shows that financial growth is no guarantee of brand strength. For more information visit www.futurebrand.com.
E-books have yet to make the grade with college students
Despite headlines proclaiming the death of the printed book due to burgeoning digital content and electronic reading devices, the printed page remains the big man on campus among college students, according to October 2010 data from OnCampus Research, an Oberlin, Ohio, division of the National Association of College Stores (NACS).
Only 13 percent of college students had purchased an electronic book of any kind during the previous three months, and of that percentage, 56 percent stated that the primary purpose of their e-book purchase was required course materials for class. The survey also confirmed a finding of NACS’ 2010 OnCampus Student Watch survey in which 74 percent of college students preferred print over digital. Overwhelmingly, students are reading e-books on a computer rather than a dedicated e-reading device. In fact, 92 percent of students indicated they currently do not own an e-reader, and of those, 59 percent said they didn’t plan to purchase one in the next three months. Approximately 77 percent of the students who said they recently purchased an e-book indicated that they used a laptop computer or netbook to read it. Desktop computer was the second most popular choice (30 percent), followed by a smartphone (19 percent). Another 19 percent reported using an e-reader like a Kindle or Nook. A tablet computer, such as an iPad, was the least-common reading device used by students, selected by only 4 percent of respondents. For more information visit www.oncampusresearch.org.