GM scopes dealerships' customer loyalty scores
DETROIT -- If the customer loyalty rate at Stingray Chevrolet in Plant City, Fla., dips below that of competing stores, dealer principal Steve Hurley wants to know about it. So does General Motors.
As of November, GM dealerships have had a better view than ever of how many customers return for their next purchase -- and how many defect to rival stores.
The information comes via dealership loyalty scorecards provided by R.L. Polk & Co., a suburban Detroit research firm that tracks new-vehicle registrations.
GM has rolled out the tool across its network to give dealers a clearer view of the competitive landscape and compare their customer loyalty rates with their peers', says Alicia Boler-Davis, GM's vice president of customer experience and global quality.
"It's surprising what you can see happening when you get to that level of detail," Boler-Davis says. "Now we're working with dealers to identify what are the key drivers of retention as well as defection."
For instance, the scorecards might lead to GM more heavily mystery shopping stores that rank below their market averages. The data also will help GM field personnel identify problems at specific stores.
Automakers long have closely scrutinized brand loyalty. But increasingly, they're drilling down to the retail level to monitor which stores are effective at retaining customers, says Brad Smith, director of Polk's loyalty management practice.
Polk has offered the loyalty scorecards since 2006, but demand from automakers has spiked over the past two years, Smith says. Now, the vast majority of automakers in the United States use some version of the service, he says.
Hurley, co-chairman of the Chevrolet National Dealer Council, says the data can help dealers flag problems. For instance, a Chevy dealer who has a higher-than-average share of customers defecting to rival Chevy stores is a red flag.
"They may be loyal to Chevrolet, but they're not coming back to buy from you," Hurley says. "If some dealers are really roughing up customers in the showroom on price or whatever, that's going to be reflected in those numbers."
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