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Toyota Exec Talks About the Scion Experience

March 20, 2007

Speaking at the Motor Press Guild (MPG)’s March 6 meeting, Scion’s Stephen Haag talked a lot about what Toyota has learned since launching its youth-targeted nameplate in the summer of 2003. The one challenge that’s remained constant, he noted, is that the transaction time still takes too long for the brand’s time-obsessed young buyers.

“Generation Ys are extremely crunched for time, and we need to make the most of every walking moment,” he said. “So we developed our processes like the Pure Price buying process to connect with these young buyers, and we worked to provide quick and efficient service and fast transaction time. Why? Because they’ve experience it their entire lives. It’s what they expect and they won’t settle for any less.”

Haag said educating customers about the F&I process is one of the challenges Scion must overcome, as is improving product knowledge on the sales floor. A bigger problem, he said, was better connecting Scion’s Web site with dealerships.

Often times, he said, a prospect will configure a Scion online and use the payment calculator assuming they have first-rate credit. But once at a dealership, the prospect may learn that he or she has to pay more interest because they lack credit history.

“There are probably 10 big things we could do much better,” said Haag, a 25-year-old Toyota Motor veteran who took over the Scion post in 2005.

Haag said he didn’t blame dealers for not paying more attention to Scion, as he estimates that only 5 percent of the 930 Toyota dealers who carry the brand do enough Scion volume to warrant a dedicated sales staff.

“We really, honestly, wanted to have maybe 400, 500 dealers nationally,” he said. “We have 930, and we’re on a fast trip to 1,200.”

For the most part, Scion can’t refuse a Toyota dealer from becoming a Scion franchise. Haag said most dealers grabbed the franchise so they weren’t the only ones who didn’t. However, many stores split their sales and F&I departments between Toyota and Scion, which Haag said has hurt the Scion experience.

“Well, our preference is to have enough sales at a store that we can have a dedicated sales force,” he said. “That’s the ideal – all they sell is Scion.

“The reality is that we’re going to have that in probably less than five percent of the dealerships. Next best thing is, instead of taking an entire open floor, all 50 salespeople to sell Scion, we say take 10.”

Haag also talked about Scion’s summer release of the brands redesigned xB and new xD, and about the company’s viral Web site (www.want2bsquare.com) that does little to connect to the company’s products.

“We could sell a lot more Scions if we blasted TV ads,” Haag said. “But everything we do comes back to the goal of capturing the people who otherwise would not consider a Toyota product.”

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