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Customer Expectation: Product & Support Services

Dr Ranjana Bansal
 
The automobile industry has witnessed an unprecedented growth in the last 20 years. The Indian market opened up to the global auto majors as a result of the Government policy of liberalisation, privatisation and globalisation. A country of billion people woke up to the world outside. The Indian customer is now exposed to automobiles with new models and variants, with top quality standards and upgraded technology. Their innovative designs and dynamic performance makes driving an enjoyable experience. The market has changed from a sellers' to buyers' market.

The customer welcomed this "CHANGE" and enjoyed the "CHOICE" made available to him by the "COMPETITION". These 3 Cs'-Change, Choice and Competition revolutionised the profile of the customer, gave him the focus when every one in the industry is emphasising on his Need, Want and Demand. For both manufacturers and dealers, customer is the only source of sale, profit and growth; therefore, the CUSTOMER is the BUSINESS.

"Share of Customer" is now more important than the "Share of the Market".

What is the Customers' Expectation? A Customer wants a total solution to his transport needs in the form of High Value Product and High Value Services with both functional and emotional benefits and with integrated services and facilities, both tangible and intangible-all packed to give him a wonderful experience. Earlier, the customer was satisfied just with the product but, he is now looking for a Total Hassle-free Customer Sales Experience and Driving Pleasure. The perception of "Feel" of the customer is as important as the product and the services offered to him. The customer is not just looking for highly technical products and superior support services but also a relationship resulting from a multiplicity of company activities that combine to forge a strong bond with the customer - "One that is Emotional As Well As Rational".

3 Cs'-Change, Choice and Competition have revolutionised the profile of the customer.
"Share of Customer" is now more important than the "Share of the Market"
Customer Satisfaction is a journey rather than a destination.

Customer Satisfaction is no longer enough to survive today's competitive market place. Those in the auto trade are looking for Customers' Delight and further to that adding little extra that causes Customer to think "WOW THAT WAS GREAT" or "WOW THAT'S WHAT I CALL SERVICE". Such services can turn "Customer for Life" and "Once a Customer - Always a Customer" a reality. Customer Satisfaction is a journey rather than a destination. This means an ongoing process to meet the customers' needs and behaviour in order to develop stronger relationships with them. Good customer relationships are the heart and soul of business success. And all the people in the auto industry are focussing on processes engineered to build relationship with the customer by knowing his product preferences, budget and shopping habits and also understanding the customers' profitability.

"Getting a customer is not difficult but what is difficult is retaining him" and the key to this is "Maximize the value of Customer Relationship".

All the manufacturers are competing to give the best of the Product, the best Price, and the best of Promotion Activities - the 3 Ps of the Marketing and the 4th P - Place - The Distribution Place. The dealer has to add new dimensions to the product by offering superior quality services and a long term Relationship Bondage with the Customer. In the current automobile scenario, the dealer is the SPOC (Single Point Of Contact) for all customers whether it is selling or servicing. So to reach out to any customer, the manufacturer has to focus on this channel.

Dealer and the manufacturer are in business together to meet the needs of the customers profitably. They both can only achieve this profitability if they are able to create superior Customer Values required in the process of acquiring and retaining customers. We can take the Dealer as the First Customer to the Manufacturer. Dealer is the active stakeholder in the distribution channel of the manufacturer. A dealer and the customer are the mirror image in terms of Expectations. So a smooth selling would demand equilibrium between a Dealer's Expectation from the Manufacturer and the Customer's Expectation from the Dealer. There would be little difference - "Manufacturer - Dealer Relationship" should generate profit and "Dealer - Customer Relationship" should additionally bring satisfaction and delight in the process of creating Superior Service Values. A harmonious relationship between the three can jointly and effectively meet the customers' expectation. It is not enough to give the tangibles to the customers, but it is equally important to provide the intangible in order to affect the sale because, customer is looking for total sales experience and not just a delivery. The experience has to be such that the customer is elevated from the Driver's seat to a King's throne. This further increases the importance of the dealer in attaching emotional tinge to the sales process. Therefore, the dealer plays the most important part in Retaining and Acquiring Customers by using his Skills, Knowledge and Attitude.

With the advancement of technology, the customer expects the product to have innovative features, latest designs, dynamic performance and superior after-sale service package. He wants the integrated service of Sale, Service, Spares, Finance, Insurance, Claim Settlement, Body Shop, and Machine Shop - all under one roof. He wants a fully equipped workshop, full range of spare parts inventory, 24-hour service facility, toll-free call centres, and all-time service to give Customer an UPTIME of 365 Days to his vehicle. The Customer now does not want Warranty, but, a Customized Annual Maintenance Contract to ensure him of his after-sale service expectation.

In order to meet the expectations of the customers, the dealerships' viability has become questionable. Here are some of the factors, which are threatening the existence of the dealers.

INFRASTRUCTURE COST

In order to cater to J D Power's recommendations and dealer's identity norms, the dealers have to invest heavily in giving "state-of-the-art" infrastructure, like, showrooms and fully equipped workshops befitting the product's profile and for meeting the service demands of the customers. The dealer has to employ trained personnel for various positions, which further increases the outflow. This huge investment is not commensurate with the dealers' returns. Therefore, the viability of an automobile dealership is under tremendous pressure.

A dealer and the customer are the mirror image in terms of Expectations.
A smooth selling demands equilibrium between a dealer's expectation from the manufacturer and the customer's expectation from the dealer.
A customer is today looking for total sales experience and not just delivery.
Today's world is full of choices for the customer, but a dealer is a customer without a choice.

INTEREST COST

Not only this, the dealer has to carry huge stock of both vehicles and spares of models accepted in the market as also of models not accepted in the market, besides new variants and with them their spare parts. They also have to carry a test drive vehicle for each model. Sounds crude but true - dealers have become the stockyard of the company's products to meet their monthly, quarterly and annual targets and also to give choice to the customers (customer's expectations). The interest cost of carrying these huge stocks is detrimental to the dealer's financial health.

MARKETING SCHEMES AND DISCOUNTS

At times, the margins of the dealers are utilised by the manufacturers for new schemes, such as, "0% interest" and "free insurance" with the vehicle.

A customer wants the dealer to give a "good bargain" and "value for money". In an attempt to "beat the competition" and "sustain the market share", the dealer succumbs to squeezing his profit margin. The new concept of DMAs (Direct Market Agents) who are getting commission to source the business are earning with "0" cost and no obligation of service, has only added to the burden on the dealers. These DMAs are the ones who start discount wars among dealers.

A WORLD FULL OF CHOICES!

Today's world is full of choices (various makes and modes) for the customer, but a dealer is a customer without a choice. The manufacturer has a choice to add a new dealer in the territory of an already existing dealership. In addition to this, a dealer is also hit by this territorial infringement by another dealer in the vicinity who offers higher discount. This leads to discount wars hitting the margins of the dealers.

As a channel partner, the dealer wants to grow with the manufacturer but the introduction of new dealers jeopardises the profitability of the existing dealer. An auto dealership entails huge investments and a dealer who has pledged his sincerity and fidelity should be given the confidence of being the business partner. He would be more than willing to extend his activities to support the manufacturer to meet the demands of the growing market. If there is a mismatch in the growth of the dealer and the manufacturer's profile, only then the harsh option of addition of new dealer/s or discontinuation of the old dealer should be exercised. A customer today, expects "functional benefits" and "emotional bondage" in his sales experience and the same should be reflected in the dealer-manufacturer relationship.

IS THE CUSTOMER ALWAYS RIGHT?

As the dealer is the SPOC (Single Point of Contact) for the customer, he has to bear the brunt of the customer's ire if the product is not conforming to the customer's expectations. The dealer takes care of the needs, wants and also the demands of the customer. The customer has become so aggressive that a dealer is hauled up before the consumer court even for the non-genuine demands of warranty and, at times, finds himself at the receiving end of police harassment. The dealer has to face the legal cases for the technical defects of the products and for not giving the warranty as required by the customer.

In this competitive automotive market, the dealer has to meet the expectations of both the manufacturers and the customers. Today, it has become the responsibility of the manufacturer to support the dealer (Manufacturers' First Customer) to become profitable and to maintain the balance of manufacturer-dealer-customer relationship and expectations.

A customer today expects "functional benefits" and "emotional bondage" in his sales experience and the same should be reflected in the dealer-manufacturer relationship.
It is the responsibility of the manufacturer to support the dealer (Manufacturers' First Customer) to become profitable and to maintain the balance of manufacturer-dealer-customer relationship and expectations.

Note: Author, a medical professional, is a Dealer at Agra for TATA Motors (CVD & PCD).
 
        
        
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