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J.D. Power: Online Ratings, Social Networks Impact Dealer Selection

The research firm’s newest study shows that males are significantly more likely than females to consult ratings/review sites when selecting a dealer, whereas females are significantly more likely to consult social networking sites.

by Staff
November 29, 2012
4 min to read


WESTLAKE VILLAGE, Calif. — Nearly 80 percent of new-vehicle buyers use the Internet during their shopping process, among whom nearly one-third consult online ratings or review sites when selecting a dealer, according to the J.D. Power and Associates 2012 U.S. Sales Satisfaction Index (SSI) Study.

"For years, new-vehicle buyers have accessed the Internet to research model information, vehicle features, configurations and pricing," said Chris Sutton, senior director of the automotive retail practice at J.D. Power and Associates. "Now, neutral online ratings/review sites are playing a key role in dealer selection. Whether the online reviews are positive or negative, they impact buyers' willingness to visit a dealer."

The study finds that new-vehicle buyers are much more inclined to use a ratings/review site than a social networking site when selecting a dealer. However, satisfaction with the dealership experience is significantly higher among new-vehicle buyers who use social networking sites than among those who consult ratings or review sites.

"That's the power of the network," said Sutton. "New-vehicle buyers are using the Internet to read the reviews and recommendations of other buyers who have experience with a particular dealer, so it would be prudent for dealers to ensure their customers have had a satisfying experience, given their influence on prospective customers."

Among new-vehicle buyers, males are significantly more likely than females to consult ratings/review sites, whereas females are significantly more likely to consult social networking sites. Both genders are equally likely to visit blogs, forums, or social networking sites (7 percent each); however, females post considerably more positive online statements regarding their dealer experience, compared with males (86 percent indicate comments "mostly positive" vs. 77 percent, respectively).

The study is a comprehensive analysis of the new-vehicle purchase experience and measures customer satisfaction with the selling dealer. The study also measures satisfaction with brands and dealerships that were shopped but ultimately rejected in favor of the selling brand and dealership. Among buyers, satisfaction is examined across four measures: working out the deal (17 percent); salesperson (13 percent); delivery process (11 percent); and facility (10 percent). Among rejecters, satisfaction is examined across five measures: salesperson (20 percent); fairness of price (12 percent); facility (6 percent); inventory (6 percent); and experience negotiating (5 percent).

Overall sales satisfaction among both buyers and rejecters averages 664 on a 1,000-point scale in 2012, improving from 648 in 2011.

Satisfaction with the selling dealer averages 776 in 2012, a five-point increase from 2011. Satisfaction improves in three of the four measures that examine satisfaction among buyers, with salesperson achieving the highest score.

Among buyers whose salesperson asked them questions to determine their vehicle needs, only 21 percent perceive some or too much pressure from dealer sales staff, compared with 32 percent among those whose salesperson did not ask questions about their needs. These results indicate that customers prefer salespeople who invest the time up front to listen to them and ensure they select the right vehicle. Perceived pressure decreases when sales consultants establish a business relationship and understand customer needs.

“Given the increasing complexity of technology in today's new models, there is a growing need for dealers to spend time explaining complicated audio, entertainment and navigation systems so buyers can fully utilize all the benefits these technologies offer,” the report stated. “A majority (86 percent) of new-vehicle buyers indicate that the dealer staff spent ‘just the right amount of time’ with them during the delivery process.”

Among the 8 percent of new-vehicle buyers who say that the dealer staff did not spend enough time at delivery, nearly three-fourths indicate they would have preferred staff to spend more time reviewing their vehicle's features and technologies, such as pairing their phone to Bluetooth or demonstrating the navigation system.

Satisfaction with the dealership where rejecters shopped but did not buy their vehicle improved to 553 in 2012, a 28-point increase from 2011.

Lexus ranks highest among luxury brands in satisfaction with the new-vehicle buying experience for a second consecutive year, with an index score of 737. Rankings are based on the experiences of both buyers and rejecters. Infiniti (728) and Cadillac (725) followed in the luxury segment rankings to round out the three highest-performing brands. Year-over-year sales satisfaction improved the most for Infiniti (+52 index points), moving the up from the eighth spot in 2011 to the second spot in 2012.

MINI ranked highest among mass market brands for a third consecutive year with a score of 712, followed by Buick (706) and GMC (683). Honda improved the most among mass market brands (+30 index points) and moved from ranking 12th in 2011 to rank 8th in 2012.

For a comprehensive perspective of automotive retail trends, click here.

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