Gerardo Gomez
Director General México
J.D. Power
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View from the Top

Technology Not Only Drives the Car, It Sells It

Thu, 09/01/2016 - 12:17

Q: How have studies by J.D. Power impacted the sales and service segment of the auto industry?

A: Because OEMs are focusing heavily on the requirements of Mexican customers, we syndicated and published three studies that measure satisfaction. The first study evaluates sales satisfaction, while the others consider dealerships’ aftersales service and product quality. These provide key information for OEMs to improve their dealership network. It is gratifying to see companies leveraging this information and coming to us for more. Customers are interested in having clear information throughout the sales and service process, which includes promises on delivery times being kept and the customer being informed when deadlines cannot be met. Mexican carmakers must prioritize this kind of transparency to build trust in their brand. Regaining the trust lost over decades among Mexican customers is a long process. Many younger customers are more influenced by their elders’ opinions on brands than by advertising or marketing, meaning we have to contest backdated ideas across generations. Transparency is vital to generate trust and customers particularly value a clear explanation of what they are paying for and why.

Q: How do you encourage manufacturers to become more service-oriented?

A: The brands that produce the greatest product volumes, especially those that have been around for 50-70 years, struggle to update such a deeply engrained mindset. Realistically, new brands entering Mexico, such as KIA, are at an advantage because they can build this employee awareness from scratch, a much faster task than retraining the entire staff. Nonetheless, J.D. Power has witnessed new market entrants contracting employees from existing brands and retaining them efficiently, proving it is possible to change this mindset. The most important advice we can give to clients is to identify the final impact on end-users and to adjust processes to improve customer satisfaction. Technology offers great advantages to car dealerships, enhancing options for clients and providing assistance to sales advisors. The dealership owners are responsible for showing their teams how to get the most out of technology but until now few have directed investment to that area.

Q: How can OEMs best incorporate new technology systems?

A: All new vehicles are being updated with novel technology but in all fairness it is a challenge just to keep up, let alone innovate. We believe that OEMs should prioritize making technology affordable and easy to use but frequent updates in technology make this extremely difficult. J.D. Power offers information regarding these issues to OEMs, advising them on how a new customer with no special knowledge might perceive their vehicle’s technology so that engineers can appreciate difficulties from a different perspective.

Telecommunications are universal and access to information that is available elsewhere is desirable. The real barriers are the infrastructure in Mexico, which may not be ready for new technology, or simply the price. Prices must be decided by the market’s purchasing power, not the other way around as most brands seem to believe. This is creating an obstacle to more Mexicans adopting electric cars. Nonetheless, although some technology may be difficult to implement in Mexico, others flourish. For instance, traffic applications work perfectly and experience high demand. One of the overlooked advantages of the introduction of specialized technology in the Mexican market, such as traffic apps that would not be as successful elsewhere, is that they provide companies with extremely valuable feedback on the market.

Q: How is demand spurring the evolution of safety systems?

A: Consumers are becoming more sensitive to safety mechanisms. Any addition to a vehicle is well-received and OEMs are incorporating items such as airbags in all vehicles, not just high-end vehicles. As consumers, we now assume basic safety features will be included in all cars and although OEMs are sometimes limited by costs as to how much safety technology they can include, they endeavor to provide as much as possible as standard. Collision avoidance systems are just starting to reach all vehicle segments, and as customers begin to fully understand this technology it will be taken as a given, in the same way that electric windows have become the norm