EightBlack.

This is not really a story about cars.

It’s my current thinking on marketing. I have a marketing review for a client next week and in preparation, was surfing around looking for some “inspiration”.

I went to one of my favourite marketing guru sites - Tom Peters.

If you’ve never spent anytime wandering around his site - then you should (and you’ll notice he’s turned his site into a blog). One of his slides, in the many thousands of slides he offers as free content says “Blog everday as if your life depended on it”.

Interesting?

As I flicked through his latest powerpoint deck, it got me thinking about what products or services am I personally passionate about.

The obvious one is Google. More on that later.

The second is Apple. I’m writing this post on a new Mac Mini. More on that later as well.

And the third is Lexus.

I’m a car nut. And truth be told, when it comes to cars, probably a bit of a brand snob.

But I will admit that I’m what Tom Peters calls “a brand evangalist” for Lexus.

Why?

Because it’s not about the car.

Lexus have defined themselves and set the lead in an area that BMW, Mercedes, Jaguar, Porsche et al thought they righteously owned.

And for many of these so called brand icons or brand leaders, Lexus has them scrambling like mad playing catch up in something that they thought they set the lead on.

It’s the customer experience that sets Lexus apart.

And this is driving Mercedes Benz crazy - as it should.

Statistically, Lexus owners are the happiest customers alive. According to JD Power & Associates in the US, Lexus has won for the past 5 years in a row, every customer satisfaction survey ever recorded.

J.D. Power and Associates Reports:
Customer Satisfaction with the Overall Experience at the Auto Dealership
Greatly Impacts Revenue

Lexus Ranks Highest in Customer Satisfaction with Dealer Service

WESTLAKE VILLAGE, Calif.: 20 July 2006 — Customer satisfaction with the overall experience within the dealership can considerably impact a dealer’s revenue gain per customer, according to the J.D. Power and Associates 2006 Customer Service Index (CSI) Study^SM released today.

The study, now in its 26th year, measures the customer satisfaction of vehicle owners who visit the dealer service department for maintenance or repair work during the first three years of ownership, which typically represents the majority of the vehicle warranty period. Overall customer satisfaction with dealer service is based on six measures: service initiation, service advisor, in-dealership experience, service delivery, service quality and user-friendly service.

Lexus ranks highest with an overall CSI score of 912 points on a 1,000-point scale, achieving particularly high ratings from repair customers in the areas of service initiation and service quality.
The study finds that customers who are satisfied with the service advisor and the in-dealership experience are more likely to return for service and more likely to repurchase the same make. They are also more likely to recommend the make, which leads to new vehicle sales.

In Europe and the UK, the leading and fiercely independent Top Gear magazine begrudingly acknowledge Lexus’ dominance in customer service and satisfaction.

For me (as I think for many others) there’s 2 reasons I buy a car.

One is the emotional attachment. And the other is “ownership experience” or it’s liveability.

I think there are better cars to drive than a Lexus - from an emotional, technical, and performance perspective. A BMW 3 series is probably the best mid size car ever built. An Aston Martin DB9 is probably the most beautiful. A Porsche Turbo is close to perfection in terms of driving experience.

But there are to date, none others better to “own” or to live with than a Lexus.

Here’s why.

When Lexus was born, their parents at Toyota said - “Well, if we’re going to take on Benz and BMW, then we had better get it right the first time. Let’s just actually put together a car with zero defects and lets build a dealer network that has carte blanche to do whatever it wants” or something to that affect.

Toyota then gave Lexus their own identity and built a brand. It also helped that it gave them an unlimited supply of money.

So fast forward to today.

Lexus dominates in the most important market of all - the US.

It has achieved what it set out to do.

It’s mantra is simple. Our customers sell our cars. We facilitate the process.

It’s the most basic of marketing principles and “marketing nirvana” for all marketing managers worldwide.

Lexus, for the most part, have a rabid supply of brand evangelists worldwide. Their customers are replicating themselves everywhere.

Here’s why.

1. First Impressions count - Lexus dealerships are immaculate. The product presentation is immaculate. The sales people are dressed impeccibly.

2. They understand the “long term relationship” versus the “one night stand” when selling you a car.

3. Service - first and foremost. This is something you have to behold. When I first experienced this, I thought it was some clever marketing stunt written by some chemically aided copywriter. Lexus go out of their way to make the chore of getting your car serviced an actual pleasure. They’ll either come to your home or office with a loan car, take yours for the day, obviously clean the thing, and then return it. If you want to drop by to the dealership, then you’re greeted like an old friend, offered a decent coffee and given a loan car (and it’s not “oh sorry, this is the only loan car left and its missing a wheel and dont worry about the noise coming from the boot”) it’s sort of “take your pick of the Lexus fleet out front”. If you want to drive a 4WD, no problems. If you want that silly soft top that Britney Spears made famous, ok. If there’s one there, you can drive it.

If you dont want a car, they’ll drive you where you need to go. There’s no sign that says “we have a free shuttle bus that will take you within 5 km’s of the dealership or we’ll give you a bus pass or train ticket or we’ll call you a cab”. Lexus dealers wouldnt know HOW to call a cab for a client because if it got to that point, then I think they would say that they’re not doing their job properly.

4. Lexus know how to market to women - when we picked up our second Lexus, they have a handing over ceremony that makes even the most pompous uncomfortable. If you’re a couple, then they’ll talk to both of you equally. Our car purchase came with a leather wine carrier with a decent bottle of wine, a weekend escape for 2 somewhere (which we havent yet used) and the piece de resistance, was a voucher for $500 to have a family photo taken.

My wife still talks about this.

I have bought cars that cost twice this much and not even received anything that resembles anything like this commitment to ensuring you’ll talk about Lexus to your friends and family.

It’s clever marketing.

Our Lexus is my wifes car. I wouldnt be able to convince her to drive anything else. She’d make me sell a body part to pay for ours if things got bad.

It replaced a Mercedes Benz 4WD. It was our second Benz and personally, I’d never buy another one, despite the fact that I think they make some great product.

Firstly, Mercedes Benz are experiencing their lowest customer satisfaction surveys in history. Current Benz owners (on the most part) are not a happy bunch. Their large volume product like the A Class and M Class have experienced poor quality issues and their dealer network, to me and from personal experience, reeks of arrogance and poor service.

It would take a herculean effort by Benz to bring me back.

Apparently, the MB bosses in Frankfurt have made a decision to take $2 billion of the $3 billion they made in profits recently and re-invest in quality and service.

I’m afraid that the bird may have flown the coup so to speak.

Lexus dont outspend Benz or BMW on advertising. I dont even think their cars are better engineered. But they are as well built - and they do represent value for money.

BMW have made an art form of one of the longest after market or accessory lists on the automotive planet.

Benz are no longer the once admired, built like a tank producer of cars that they once where.

Lexus have demonstrated customer focus. The others have not.

Lexus have happy owners - worldwide. The others do not.

And Lexus customers are a passionate bunch - the others are not.

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This entry was posted on Saturday, August 19th, 2006 at 7:00 am and is filed under News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.