A friend of mine recently bought a new car.  In itself, this isn’t noteworthy since we all have friends who have bought new cars.  The interesting thing is the large difference in customer experience he had throughout the process.  (To protect the guilty, I’ve used generic names, but if you’re interested, write me a note directly and I’ll let you know who the offending Lexus dealer was.)

Dealer #1

  • Convenient and Nearby
  • Not Approached by Salesperson on Lot
  • Lengthy Delay (9 days) to Email Inquiry

Dealer #2

  • 3-Hour Drive to Lot
  • Immediate Email Response/Phone Call
  • Personalized Service

Lessons [yet to be] Learned by Dealer #1

  • Customers Have Choices – In this case the choice was to drive 3 hours each way for the promise of great service.  Unless your company delivers customer service in a monopoly, what your customers think and say matters!
  • Customers Value Service – Customers value different attributes of service.  Here a speedy reply using multiple avenues (phone, email) made a difference.  The tacit message the other dealer sent was “we don’t need you.”
  • Customers Vote with their Wallets – As I’ve written about previously, in the B2C arena, some customers will pay 25% more for better customer service.
  • Customers Talk – Word-of-mouth or referral sales are hugely powerful.  One study indicated that trust in a peer group increased from 20% in 2003 to 68% in 2006.  I heard the story and I guarantee others will too.

The good news for the brand is that my friend was already a loyal customer.  The bad news is that the experience at Dealer #1 was so lackluster that it could have pushed him to another brand altogether.

The pivot point is that customers really are willing to pay more for a positive experience and exemplary service.  In this case, Dealer #1 lost at least 2 sales (the one to my friend and the word-of-mouth sale that was created by the great service at Dealer #2).

How much would you be willing to invest in the customer experience to win a loyal customer?

The Cost of a Negative Customer Experience
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