The Automotive Industry has a Trust Issue

When you see the process of buying a car unfold from the customer’s perspective, the problems become obvious. And the experience is that bad. Building on findings from C Space’s annual Customer Quotient (CQ) study, the new Trusted Automotive Brand Study from automotive consultancy AMCI Global has pinpointed the central issue.

Jessica DeVlieger

President, Americas at C Space

Back in 2009, at an industry gathering, then-CEO of Hyundai Motor America John Krafcik proclaimed that “Americans would rather go to the dentist than visit a car dealer.”

As someone who has both had a root canal and purchased a car, I can’t disagree! Why is that? Because, even though buying a car is a big financial commitment, car shopping should be fun. You get to test drive new models, blast the sound system, take in that new car smell. It’s an experience most people have only a few times in their life.

But when you see the process of buying a car unfold from the customer’s perspective, the problems become obvious. The haggling, the manipulation, the mind games. The experience is that bad.

Building on findings from C Space’s annual Customer Quotient (CQ) study, the new Trusted Automotive Brand Study from automotive consultancy AMCI Inside has pinpointed the central issue.

“Historically, automotive companies use self-referential, closed-loop focus on customer satisfaction rankings and the minutiae of quality score,” the study says. “Turns out this may have been the wrong thing to measure all along. Using the CQ methodology, we proved that there is one very highly reliable predictor of loyalty and advocacy – Trust.”

AMCI’s study includes the 100-point Trust Index, which identifies 10 “Trust Drivers” that, when taken as a group, predict with over 90% accuracy how much customers trust an auto brand, and how trusted by an auto brand they feel. What I find particularly eye-opening is that not one single auto brand – evaluated by customers as either a manufacturer or a retail dealer – scored above 50 on the Trust Index.

It’s clear: auto brands have lots of work to do in the trust-earning department. But doing the work will pay off for them. The benchmark CQ research shows that the brands that deeply understand and make an emotional connection with customers maintain better revenue performance, enjoy higher return on assets, earn more repeat purchases, and have a customer base that is more likely to recommend them.

What’s the upshot for auto brands? The AMCI study makes it explicit: “Every automotive brand is potentially leaving hundreds of millions of dollars on the table by not focusing on building trust. Trusted companies will win and untrusted companies will lose market share.”

The Trusted Automotive Brand Study shows that increasing your Trust Index score is associated with higher rates of repeat purchase. If you put that into practice, the study points out, “a typical mid-sized brand could expect as much as $100 million in increased revenue on improved customer retention on returning leases alone with just one point of improvement on the AMCI Inside Trust Index.”

The pace of innovation in the automotive industry is staggering. New technologies are becoming the new normal. And all of this is advancing the industry and our lives. However, auto brands must acknowledge that product innovation alone is not enough to appeal to consumers and to earn their trust and loyalty. For them, buying a car is an emotional experience. It plays a major role in how they feel walking into a dealership, and driving out of it. As the AMCI study shows, auto brands would be well served to work as hard on improving their emotional connection with customers, and the experiences they have, as they do on innovating their product.

They should seek inspiration from outside the industry, too. Beloved brands like Starbucks and Harley Davidson, for instance, have focused on bolstering the brand qualities – such as empathy, authenticity, and shared values – that customers say matter. As a result, good things have followed, like recommendations, increased loyalty, more revenue, and, of course, trust.

Trust breeds loyalty. The key for auto brands in earning it is to see their experience from customers’ perspectives. Once they do, we’ll want to visit the car dealership more than the dentist.

You may be interested in:

The Lifestyle Experience

The Lifestyle Experience Thirty years ago, the brand was advertising. TV and radio commercials, billboards, print ads – these, along with word-of-mouth, were just about the only interactions customers had with a brand before they bought its products,...

Tina Sharkey, Brandless CEO: It’s Gotta Have Soul

Tina Sharkey, Brandless CEO: It’s Gotta Have Soul Subscribe to the Outside In podcast: Tina Sharkey is an entrepreneurial force. Since the days of the dial-up modem, she has been building communities, companies, and brands “with soul.” Today, she’s...

What Retailers Need to Know to Own Customer Experience in the Apparel Industry

What Retailers Need to Know to Own Customer Experience in the Apparel Industry

by Robert Howie (C Space)
Apparel Magazine

Although the market has proven uncertain for several brands, retailers can survive these difficult times. For the apparel market to succeed in delivering better experiences for customers, it needs to go back to basics.

Jeff Beer, Fast Company: The Best a Brand Can Be?

Jeff Beer, Fast Company: The Best a Brand Can Be? Subscribe to the Outside In podcast: Trend chasing does not make for great advertising. It’s not a business model, either. As Jeff Beer, staff editor at Fast Company sees it, advertising is everything a...

Customer experience metrics must be adaptable

Customer experience metrics must be adaptable

by Sarah Ramirez
Luxury Daily

As more luxury brands are getting up to speed with ecommerce, companies also need to adapt how they value and measure customer experience.

Beth Comstock: An Outsider Inside

Beth Comstock: An Outsider Inside Subscribe to the Outside In podcast: As Beth Comstock sees it, most companies simply aren’t ready for the massive change happening in the world. After nearly three decades in senior leadership roles at GE and NBC...

Is Optimism Dead?

Is Optimism Dead? As we approach 2020, the future feels less certain than ever for customers. So that’s why we’ve launched Life as a Customer, a window into the worlds of 700 customers, powered by C Space. We share our first findings in this article......

Customer Experience Lessons Retailers Can Learn From the World’s Best Companies

Customer Experience Lessons Retailers Can Learn From the World’s Best Companies

by Rieva Lesonsky
Small Business Trends

How can your retail store deliver a best-in-class customer experience? Learn from the best, that’s how. Global customer agency C Space recently released its report on the best customer experiences of 2018, and retailers dominated the top companies on the list. Nine of the top 25 companies were retailers: Trader Joe’s, L.L. Bean, Nordstrom, Amazon, Costco, REI, Bath & Body Works, Sephora and Aldi.

Best Agency Above £20m and Best Place to Work: C Space

Best Agency Above £20m and Best Place to Work: C Space

by Katie McQuater
Research Live

At the 2018 MRS Research Live Awards, C Space was awarded Best Agency with a turnover above £20m and was also named Best Place to Work.

Rita Gunther McGrath: What’s Next for Strategy?

Rita Gunther McGrath: What’s Next for Strategy? Subscribe to the Outside In podcast: Author and Columbia Business School Professor Rita Gunther McGrath is a world-renowned expert on strategy, innovation, and growth. Her work has been a beacon for companies...