Mercedes-Benz USA
2013 After Sales Marketing Strategy
Marketing Plan
MBUSA Customer Commitment
A Differentiating Approach Externally and a Guiding Effect Internally
•
CustomerOne is our internal business strategy which aims to espouse a culture that
empowers all MBUSA and dealership employees to be ‘DRIVEN TO DELIGHT’ every
customer at every touch point
•
A commitment by our employees and dealers to be recognized as #1 in customer
experience across all industries. The foundation for our road to our 2020 objective
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MBUSA Customer Commitment
From VIN to Customer Focused
•
Passenger Vehicles – My Service: Individuality (rational) & Appreciation (emotional)
•
Parts Business – Part of your success: Competence (rational) & Closeness (emotional)
•
Commercial Vehicles – Driving force: Availability (rational) & Partnership (emotional)
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Marketplace Overview: Customer Trends
Passenger Car Market
“Luxury customers are becoming increasingly less satisfied,
seeking ‘intimacy, meaning, story, quality, provenance and a true
sense of wonder’.”
- 360 Connect; Nov. 29, 2012: Jeannie Walters
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Marketplace Overview
Customer Trends Optimistic Achievers
73%
57%
43%
•
58% in post-family life stage, however, MB
consumers are more likely to have kids at
home than segment (31% vs. 27%)
•
Affluent: Median income of $170,000
(avg. for segment: $145,000)
•
Well-educated
•
Male
Source: Merkeleytargetwork
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Female
Married
‒
72% have college degrees
‒
47% have post-grad degrees
Accomplished/Successful
‒
Professional/Exec with a higher proportion
of entrepreneurs
‒
Index highly on: banking/finance, started a
business, sold a business and/or professional
Marketplace Overview
Customer Trends The Changing Landscape
• Women are the fastest growing segment of car buyers at
car dealerships
• 9 out of 10 women are involved in their household's vehicle
maintenance and repair decision-making process*
• 65-70% of the customers taking cars in for service and repair
are women
• Women and younger vehicle owners (those in the Generation Y
and Generation X demographics, between ages 23 and 47) are
less likely to choose the same vehicle brand for their next
purchase, compared with men and older owners**
*Source: Automotive Aftermarket Industry Association
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Marketplace Overview
Customer Trends The Changing Landscape (continued)
• Women and younger vehicle owners are more likely to
experience changes in their life circumstances, including
growth in household size or changes in income levels, that
would lead them to purchase vehicles that better
accommodate their new lifestyle**
• Many automotive brands are expanding their array of models
in an attempt to capture more buyers, but this isn’t enough in
and of itself…Manufacturers need to integrate specific
attributes and features that delight vehicle owners to
maximize their opportunity to both retain customers and
conquest from other brands – Raffi Festekjian, director of
automotive product research at J.D. Power and Associates
**Source: JD Power 2012 Customer Retention Study
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Marketplace Overview
Customer Trends Evolving Customer Base
The Face of Affluence is Shifting
34%
Of Millennials (age 18 – 33) have been wealthy throughout their lifetime as compared to less
than 10% of all other generations
17%
Of affluent and wealthy working Millennials are CEO’s running their own business, with many
coming to market fully informed and engaged with luxury categories in ways that belie their
youth
75%
Of affluent Millennials want brands that are Pro-social
85%
Of affluent Millennials want brands that have a reputation for design
77%
Of affluent Millennials want brands that have history and heritage
72%
Of affluent Millennials want brands that make them feel they own something rare
Source: American Express Publishing and Harrison Group 2012 Trend Data from the Annual Survey of Affluence and Wealth in America
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Marketplace Overview
Customer Trends Communication Preferences
Preferred channel and frequency of communication from service providers
Channels Preferred
Open to communication
18-35
35+
Frequency Preferred
Every 2 to 3 Months or More Often
Overall
18-35
60
60
50
50
40
40
30
30
20
20
10
10
0
email
Mail
Live Calls
Source: DMEautomotive Survey, August 2012
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Recorded
Calls
Mobil APP Text Messing
Notifications
0
email
Mail
35+
Live Calls
Overall
Recorded
Calls
Mobil APP Text Messing
Notifications
Market Overview
Customer Trends How Customers Learn About Maintenance
Source type
18-34
35+
Twitter
6%
1%
Blogs
13%
3%
Family/Friends
50%
37%
Online message boards
16%
3%
Social networking sites
18%
3%
Auto store locator and review websites
13%
7%
Owners Manual
43%
61%
Auto print media
12%
8%
Online video
23%
6%
Service centers
32%
33%
Vehicle review websites
24%
13%
OEM websites
24%
19%
Owners Manual
43%
61%
Source: DMEautomotive Survey, August 2012
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Marketplace Overview
Customer Trends Pest Analysis
•
•
•
•
•
•
•
78% believe that the US is currently in a recession
5.2% believe the recession will continue for another year
70% say that the recession has made them a more
resourceful person
80% say that having more confidence in the future would
lead them to increase spending*
•
One in five customers ($250,000 + income) are worried
about being disparaged for being financially successful.
•
‒
•
This is magnified among successful Millennials and GenXers at
36% (compared to Boomers at 17%)
Trends of careful and resourceful spending, cash savings,
self-sufficiency and conservative continue
Affluent’s purchase behavior is shifting from value-priced
goods to products and services that provide “worth” and
superior craftsmanship*
•
•
•
For New Affluents ($100K + HH/$206K mean),
the environment ranks 2nd behind the U.S.
economy as one of the most important
external factors in personal decisions
49% of New Affluents place importance on
protecting the environment**
New Affluents are highly opinionated and
share their views with others
Are tech and media savvy. Texting, tweeting,
searching, blogging and “liking”
90% of New Affluents talk about brands
and 84%
recommend others purchase a specific brand
For 85% of New Affluents, technology
permeates all aspects of life
*source: American Express Publishing and Harrison Group 2012. Trend data from the American Survey of Affluent and wealth in Americans
** Dwell Media LLC – 2012 New Face of Affluence Survey – Top Line Findings
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Marketplace Overview
Customer Trends Loyal Customers Matter
•
•
•
•
Acquiring new customers can cost as much
as five times more than satisfying and
retaining current customers
A 2% increase in customer retention has the
same effect as decreasing costs by 10%
Customer profitability tends to increase over
the life of a retained customer
Depending on the industry, reducing your
customer defection rate by 5% can increase
your profitability by 25 to 125%
Source: Leading on the Edge of Chaos by Emmet C. Murphy and Mark A. Murphy
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Marketplace Overview
Customer Trends Loyalty in the Luxury Car Market is Imperative
Service Plans can more than double service business that typically bleeds to the aftermarket,
while also having a profound impact on retaining the young, traditionally dealer-averse,
service shopper’s business
• 56% of consumers with a prepaid or “complimentary”
service plan are likely to continue servicing at
dealership after expiration
• Roughly 1 in 4 U.S. vehicle owners have a
dealer/OEM prepaid or free service plan
• 62% of those that use plans for “all” maintenance are
likely to stick with their dealer
• Next-generation servicers (under age 35) are more
likely to have a plan (31%) than those over 35 (18%)
Source: DMEautomotive Survey, August 2012
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• Next-generation servicers (under age 35) are more
likely to have a plan (31%) than those over 35 (18%)
• Next-generation servicers are more likely to have all
maintenance done under the plan/at dealer (72%)
than those over 35 (61%)
Marketplace Overview
Customer Trends Why Customers Leave
•
Among new-vehicle owners who switched
3%
Move away
vehicle brands for their latest purchase, 33
percent indicate that their previous brand didn’t
offer the type of vehicle they wanted
•
Although this is a primary reason for switching,
9%
Begin doing
business
with the
competition
5%
Seek
alternatives
other key reasons relate to dissatisfaction with
68%
Become upset with
Customer service
the previous vehicle, including the vehicle costs
too much to own or maintain; there are too many
problems with the vehicle; and the vehicle didn’t
14%
Are dissatisfied
with the product or
service
retain sufficient resale value
1%
Pass away
Source: J.D. Power and Associates 2012 Customer Retention StudySM
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Source: The U.S. Small Business Administration and the U.S. Chamber of Commerce
Marketplace Overview
Customer Trends Customers are Keeping Their Cars Longer
• Americans are now holding onto their new vehicles for a
record 71.4 months
• On the used vehicle side, that interval has risen to 49.9
months, a new high mark
• Collectively, the ownership period currently stands at 57
months, up from about 38 months back in 2002
• The average age of the passenger car and light truck fleet
in America has now reached an all-time high of 10.8 years
• Vehicle age drives increased service costs and customer
pay, however as the vehicle ages the customers decide to
repair less of the items needing to be repaired, focusing on
the most critical service items
Source: R.L. Polk & Co
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Retaining service customers
is more important than ever
Marketplace Overview: Competitive Trends
"Luxury is not about price; it's about longevity and trust in a brand.
It's about the emotional experience more than the function."
- Jan-Patrick Schmitz, president and CEO of Montblanc N.A
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Marketplace Overview
Retention and Satisfaction Reflect Brand Equity
CSI
BMW
Mercedes Benz
Retention
Mercedes
BMW
70
Lexus Cadillac
60
Infinity
Lincoln
Volvo
BMW
58.71
Lexus
Audi
50
40
61.02
Mercedes
54.40
Cadillac
58.39
Acura
56.32
Infiniti
56.19
30
Lexus Cadillac Infinity
20
Audi
Lincoln
Volvo
Audi
10
0
800
810
820
830
840
850
860
870
Category Average
50.00
CSI – source: JD Power & Associates CSI Study 2012
Retention – source: : JD Power & Associates 2012 Customer Retention Study
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55.36
54.78
52.00
54.00
56.00
58.00
60.00
62.00
Source: 2012 Harris Poll EquiTrend Luxury Automotive Brand of the Year
Marketplace Overview
CSI Ratings on the Rise
2012
2011
2010
Lexus
861
Lexus
846
Lexus
837
Cadillac
852
Cadillac
830
Cadillac
827
Audi
828
Lincoln
817
BMW
816
Mercedes
827
BMW
814
Mercedes
805
Infinity
824
Mercedes
810
Lincoln
803
BMW
823
Infinity
801
Audi
794
Lincoln
817
Audi
794
Infinity
784
Volvo
811
Volvo
788
Volvo
763
Source: JD Power & Associates CSI Studies 2010-2012
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Marketplace Overview
How Luxury Brands "WOW" with Service
"We are ladies and gentlemen serving ladies and gentlemen." One of its remarkable policies is to permit every
employee to spend up to $2,000 making any single guest satisfied. The concept is to do something, to create
an absolutely wonderful stay for a guest. Significantly, there is no assumption that it's because there is a
problem, but simply to create an outstanding experience. Example: hiring a carpenter to build a shoe tree for a
guest.
Known for their customer service, Nordstrom employees work to exceed the expectations of every guest. “He
asked to see a pair of shoes, and the salesman brought out six pairs – The one he wanted plus five similar
ones. He told the guy he only needed the one, and the salesman said, well, he wanted to give him more
options, just in case.”
“On every one of our cards there’s a date, a reminder, that before this date, we have to exceed expectations.
We have to find new ways to help make life easier, more convenient, and more rewarding. It’s the reason why
we don’t have customers. We have members.” In 2011, American Express created guest lounges at high end
malls where card holders could check their coats and bags or simply take a break from hectic holiday shopping
and enjoy a cup of coffee or tea.
A group of Mercedes-Benz executives visited a Mont Blanc store recently. The store was closed to all other
guests while MB executives toured the store and learned about Mont Blanc’s products. There was no hard
selling and though no one present made a purchase that day, each person received a personal follow up from
Mont Blanc. "Luxury is not about price; it's about longevity and trust in a brand. It's about the emotional
experience more than the function." Jan-Patrick Schmitz, president and CEO of Montblanc N.A.
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Thank you
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