SINGAPORE: 30 August 2013 — Despite strong first half improvements in new-vehicle sales in the Philippines, overall satisfaction with the new-vehicle purchase experience has declined in 2013, according to the J.D. Power Asia Pacific 2013 Philippines Sales Satisfaction Index (SSI) StudySM released today.
Now in its 13th year, the study examines seven factors that contribute to overall customer satisfaction with the purchase experience. In order of importance, they are delivery process; delivery timing; salesperson; paperwork; deal; sales initiation; and dealer facility. SSI performance is reported as an index score based on a 1,000-point scale, with a higher score indicating higher customer satisfaction.
Overall sales satisfaction averages 846 in 2013, down nine points from 2012. The decline in satisfaction is driven by lower scores across all factors, most notably in salesperson.
"Managing the expectations of new-vehicle buyers is a crucial aspect of the salesperson's responsibility at dealerships, and this is where the communication and following through on commitments hold the greatest value in sales satisfaction," said Mohit Arora, executive director at J.D. Power Asia Pacific, Singapore. "Fewer customers in 2013 have been informed about the delivery timing of their vehicle, which impacts the proportion of customers who are delighted with their salesperson's level of commitment."
The study finds that 76 percent of new-vehicle buyers finance their new-vehicle purchase through a loan, an increase of 5 percent from 2012. However, a salesperson's initiative in offering a loan to buyers has significantly declined, as the proportion of new-vehicle buyers who are offered a loan declines to 79 percent in 2013 from 90 percent in 2012. Additionally, among buyers who use a dealer-arranged loan in the purchase of their new vehicle, 69 percent choose an independent financial provider themselves, a significant increase from 44 percent in 2012. Satisfaction scores among these customers is 17 points lower than among those who obtain a loan through the vehicle make's finance provider and 40 points lower than among those who finance through a provider endorsed by the dealership.
"As the Philippines has experienced a growth in credit during the past years, banks have been very aggressive in their auto loan offerings in the market," said Arora. "The convenience of applying online, the speed of having a loan approved, low interest rates, and such other perks as the issuance of credit cards, are among the items that attract would-be buyers to finance their purchase of a new vehicle through a financial provider of their choice."
Arora suggested that dealerships and manufacturers have to adapt quickly to the changing preferences of customers and encourage them to use captive finance providers for which satisfaction scores are highest.
The study also finds that customer satisfaction with the overall purchase experience has a strong impact on their loyalty to the dealer. Approximately 51 percent of "delighted" customers (those providing a rating of 10 on a 10-point scale) say they "definitely would" have their vehicle serviced at the purchase dealer, compared with zero percent of "disappointed" customers (those providing a rating of 5 or less).
"In a market where word of mouth is a critical source of information for new-vehicle buyers, dealerships and manufacturers must not lose focus on delivering exceptional service, which begins during the sales process," said Arora. "Doing so encourages favorable recommendations that, in turn, promote repeat business."
Among the 10 brands ranked in the study, Ford ranks highest with an overall score of 855. Ford performs particularly well in five factors: delivery process; delivery timing; paperwork; deal; and dealer facility. Nissan and Toyota rank second, in a tie, with a score of 849 each. Hyundai ranks third at 847 and performs particularly well in the deal and sales initiation factors.
The 2013 Philippines SSI Study is based on responses from 1,573 new-vehicle owners who purchased their vehicles between August 2012 and April 2013. The study was fielded from February to June 2013.
About J.D. Power Asia Pacific
J.D. Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, Australia, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding J.D. Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected]
About J.D. Power
J.D. Power is a global marketing information services company providing performance improvement, social media and customer satisfaction insights and solutions. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. Headquartered in Westlake Village, Calif., J.D. Power has offices in North America, Europe and Asia Pacific. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power is a business unit of McGraw-Hill Financial.
About McGraw Hill Financial
McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power, and McGraw Hill Construction. The Company has approximately 17,000 employees in 27 countries. Additional information is available at www.mhfi.com.
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