Loyalty by the Custom Publishing Book
By John Hennessy
Volkswagen views its vehicle owner’s manuals differently than other automakers. Equal emphasis is place on thoroughness, usefulness and stylish presentation. It not only strives to make its car manuals more attractive but also more informative than those available from other auto companies. Volkswagen has sought – and apparently achieved – a competitive advantage from its owner and service manuals.
Jan Rüger, project lead in the service division at Volkswagen’s world headquarters in Wolfsburg, Germany, said there are good reasons why the company puts so much emphasis on its manuals. “They are the business card of the company,” he said. “The look and feel and appearance are really better than the competition’s, and we’ve found they are perceived very well in the marketplace.”
According to a report on the Baseline magazine Web site, back in 1997, Volkswagen was looking to enter new markets in Eastern Europe and Russia. At the same time, the auto manufacturer was also looking to completely revamp how it produced owner and service manuals.
The goals, Baseline reports, were: “Replace a creaky, paper-targeted production system with one that was better able to work across all media; extend the number of languages in which manuals were produced by a factor of four or more; streamline the entire production process while reducing errors and the need for rework; and handle a diverse and growing range of technical manuals, wiring diagrams, data sheets and other publications.”
The company was also looking at adding functionality to its manuals. At the time, Volkswagen was in the process of bringing the Phaeton luxury sedan to market. With a price tag of $60,000, the company wanted to give its customers something extra in their owner’s manuals for the money.
The result was the company customized each owner’s manual to describe specific features and options selected by the buyer. The manual was not simply a Phaeton manual, but John Doe’s Phaeton’s manual.
At this juncture, Volkswagen has no plans to create customized manuals for its mass-produced models. As Baseline reports, “While its new editorial system could easily produce such manuals, the company would face a potentially huge logistics problem. Volkswagen produces cars at two-dozen facilities around the world, at a rate of about 3,000 cars per day and with myriad combinations of engines, radios and other equipment. With all manuals printed in a single plant in Germany, nobody has yet figured out how to match manuals to cars on such a global scale.”
Moderator’s Comment: What elements of their business that perhaps retailers take for granted can be improved to strengthen customer relationships?
Most of the Baseline article is about Volkswagen’s refining the process of creating its manuals. What caught my eye was how the company didn’t view
this process as a necessary evil but as something that could be used to better connect Volkswagen with its owners. That kind of thinking leads to different results.
For retailers, a few suggestions: How about posting a calendar of local and major events in several places in your store. Your busy customers will appreciate
being reminded that there’s a holiday weekend they need to stock up for or a local event for which they may need treats and juice boxes. You could even offer a spot where local
youth sports teams could post their schedules in your store and on your Web site.
What about keeping copies of your annual report in the waiting area of your pharmacy? Give your customers a chance to learn more about what your company
is all about.
While we’re in the pharmacy, how about borrowing a page from Ikea – it hangs disposable tape measures around the store – and hang disposable magnifiers
in your pharmacy to assist shoppers with the small print on medications. I bet you could even get a vendor to sponsor them.
Your turn. –
John Hennessy – Moderator
A custom owners manual feels like fine tuning, but fine tuning should be done only if you are getting the basics right first. VW’s ranking near the bottom of JD Power’s Initial Quality survey is a basic. Having adequate inventory, and enough variety of inventory, at all of the dealerships is a basic. Having as many standard features as your competitors, for a similar price as your competitors, is a basic.
It is far easier to kill someone’s warm fuzzy regarding a brand than it is to build it. A custom owners manual probably would help build one, but only if everything else has gone right up until then.
There’s an overlap between this discussion and today’s other one about knowing customers’ names. One foolproof, basic and easily achievable objective should be courtesy. Following the old golden rule about doing unto others etc and treating all customers alike. It doesn’t matter how much they’re spending today, being friendly, helpful, cooperative, polite will build loyalty whether or not you actually know their names. You never know what they’ll tell other people or how frequently they will be back or how much they will spend. Here’s a simple slogan – invest in your customers.
Let’s remember that Volkswagen is not a retailer. It is a wholesale manufacturer. Their independently-owned stores are the true retailers – at least here in the U.S. – and these retailers are really VW’s customers. I’ve worked closely with one VW store owner – and thus with his “20 group” of additional VW stores – and became pretty familiar with how VW retailers are treated by their wholesale supplier.
All of us associated with sales of any kind were trained to “underpromise and overdeliver.” VW has a worse record than many auto manufacturers in this regard, and their new “business card” product manuals are an example of this. During recent years, VW has fallen behind competitors in the design, production, and delivery of new models, thus putting their retailers at a disadvantage. Additionally, the rate of needed repairs of new VWs is generally higher than other brands, thoroughly frustrating retailers who must perform more warranty repair work while having to face irate customers who’ll never be repeat purchasers.
Therein lies a lesson for retailers, who must depend on their wholesale suppliers for superb products. Manufacturers’ national advertising hyperbolicizes new products, often overpromising and underdelivering. But consumers never come face-to-face with manufacturers. Instead, they hold retailers responsible for the quality of the branded products they carry.
Retailers must thoroughly investigate and become familiar with the products they carry, because in the eyes of consumers they are ultimately responsible. One reason that private label products have enjoyed popularity, such as those offered by retailers as diverse as Sears and Trader Joe’s, is that the retailers take personal responsibility for the quality.
Having better owners manuals is a great start, but only a start. Whatever happened to “mass customization”? If I recall, just about everything was supposed to be made to order by now. Guess that didn’t happen. It’s kind of amazing to think that a huge company like VW can’t handle the logistics of producing a customized manual for each car that rolls off the assembly line. Makes you wonder how the cars themselves ever get produced.
For retailers, John had some great suggestions. To add to that, how about personalized shopping offers? Why do we keep getting irrelevant offers jamming our physical e-mail boxes, as well as our e-mail boxes? At some point soon, we’ll figure out how to really start reducing junk mail and newspaper inserts and making truly customized offers to shoppers. This would seem to be a great opportunity for regional and independent operators to establish a deeper connection with their shoppers than the big guys who compete mainly on price.
It takes only one dropped ball to lose the ball game. Creating an amazing customer experience requires ‘flow’ – that is from the first point of contact to the end of the process (if there is an end) EVERYTHING has to contribute positively to the experience in a consistent and aligned way.
The tape measures at IKEA help do that. The personalized manuals when someone buys a luxury car help do that. But frankly it’s not hard to create sporadic ‘moments’ that impress a customer. The challenge is to put the entire experience together.
Just yesterday I read a review of the Porsche 911 Carrera – $74,565. The guy drooled over this car but then added “there are some plastic bits like cheap-looking door handles and a seat adjuster that came off in my hand.” That is a dropped ball and a personalized manual doesn’t make up for it. That’s why I’m not buying one now.
Too many retailers think up clever little bits designed to impress a customer but fail to look at the overall flow of the experience. The best thing they could do is to locate where the ball gets dropped in their customer’s experience.
What’s important here is that Volkswagen actually thought about the customer experience and acted on it. They put forth the effort to treat the customer as an individual and not a “tweener, gen exer, baby boomer.” While market research is fine, actually treating a customer as an individual seems to be the mantra of the future. With the advent of the internet and consumers having the ability to communicate directly with manufacturers – consumers now, more than ever, have the ability to customize products to their exact wants. Our US manufacturers have followed McDonald’s with bundled packages of options and forbade the consumer from buying leather seats unless he agrees to buy 20 other (sometimes) unwanted options first. If GM and Ford are listening, I would encourage them to use technology to sell more made to order cars and trucks. There are thousands of ways to more deeply involve the consumer with a purchase. Volkswagen seems to be committed to involving their customers; making them a part of the family. Why don’t our manufacturers ever seem to lead the way?
The “force to sell” and the “need to relax anxious customers” are always in potential conflict with auto dealers. All kinds of marketing gimmicks have been employed by auto dealers to reassure the customer that they have the customer’s interests at heart. Ha, who really believes that? My guess – nobody!
I presume that’s why they’re called “dealers” not retailers. Perhaps VW’s manual could be an exception with a few drivers.
Auto dealers should always search for honest ways to get potential customers into their showrooms when they aren’t yet in the market for another car; work at building a personal and relaxed relationship aside from the frequently combative sales and financing experience. There are numerous ways dealers could do that but it would seem that the relentless pressure is always on selling something, somehow, to somebody the very moment they make contact and before they can get out of the showroom. A visit to an auto showroom is hardly a visit.
The VW web site allows a customer to “build” his/her own VW, specifying colors, options, etc. The same technique could easily be used to allow customers to access manual sections on-line, custom tailored to the individual. The 3-year old VW manual (for a Passat) I’ve seen has a very awkward binder, a hard-to-find-what-you-are-looking-for index, and childish repetitive legal disclaimers on half the pages.
On-premise flu shots are a customer-driven service that some drug stores adopted. Why not sublet space to walk-up “doc in a box” chains? Why don’t supermarkets sublet space to nutritionists? Why not sublet space to the self-prepared meals franchises (covered a few weeks ago in www.RetailWire.com)? Why not sublet space in the parking lot for farmer’s markets, see what is most popular, and then bring the most popular offerings inside the store?
One comment mentioned getting the basics right. Another mentioned that VW ranks low in initial quality. Another mentioned that VW really isn’t the retailer, their independently owned dealers are the retailers. All these areas are and should be more of the concern for VW than their manual. The manual is of limited necessity if you have a dealer taking care of you properly.
For some months now, I have had the president of one VW dealer call me personally to ask for a second chance. This is the perfect example of the position that VW is in today.
The problems with initial quality relate more to how these small items are taken care of by their dealers and less about the actual production quality of the vehicle itself. This is an internal struggle for VW in dealing with their dealer network. In their decline some years ago they fell to being a non-primary brand and thus lost much of their ability to control their dealers in order to simply stay in the market. Today, even though they are back as a player in the market, their position as a non-primary brand in dealers hasn’t changed. Thus, their end consumer connection hasn’t changed in a positive way. This type of transition takes longer and will hamper their ability to continue their growth at this point.
These struggles with their dealers and basic services need VW’s full attention. While improvements to their manual are admirable, they miss the target of their struggle at this point. My experience with them with two different dealers in two different geographic regions was much the same. They were all about selling me a very fun car to drive at a fair price. They both fell flat on their faces in their ability to provide even a minimally acceptable ownership experience.
Cars, at least in my part of the world, sell themselves. Unfortunately, the ownership experience doesn’t. For me personally, it’s less about the car and more about the long term ownership experience. I’ve found a ‘different kind of car company’ for that.
Retailers in general miss that point. VW’s position is difficult. Without rapid change in dealership controls and expectations, their hard work in returning as a player in the market could be over quickly.