Sales In The Digital Age: The Exotic Disconnect

Respect For The Customer QuoteThe following saga contrasts the experiences between two corner-case consumers of exotic sports cars. Despite their “first-world problem” nature, the embedded customer experience anecdotes hold lessons for any executive, entrepreneur, brand manager, department head, or visionary aspiring to be one of those things.

Customer ownership experiences reflect a manufacturer’s corporate culture and degree of respect for the customer. Resourced intelligently, even customer problems become sales and loyalty drivers, more than making up for inevitable engineering or production quality assurance failures. Short-shrift the post-purchase customer experience and wronged customers in this digital age are motivated and empowered to create terrible brand drag. Disappointed customers degrade expensive marketing ROI. Just a few pissed off customers can wreak havoc on an entire brand, driving away future sales.

Wouldn’t you think luxury brands that cater to an exclusive customer pool would manage problems well in this connected age? It doesn’t have to be expensive, so it’d be the height of folly not to. Right?

Crazily, many luxury brands still fail epically at managing problems in even the simple ways that can mean so much to dismayed customers. I refer to this kind of failure as an Exotic Disconnect because it’s so prevalent in boutique, luxury companies like those producing exotic cars. The exotic disconnect is what happens when a company goes to great lengths and huge expense to engineer and position its products or services–its brand–as distinct, as coveted, as exclusive, but has placed all emphasis on engineering and marketing while failing basic management of the post-purchase customer relationship. It’s painful to behold, even if you’re not the dismayed consumer victimized by such a failing. Ferrari used to be famous for their Exotic Disconnect. Their brand defines high-performance exotica among those whose impressions are based on marketing more than reality, but Ferrari has labored for decades under the sales-harming perception of apathy, if not disdain, toward owners.

Before venturing irreversibly down the entrepreneurial path, I spent significant corporate time doing customer, product, technical, and community support for large corporations. My term in corporate purgatory spawned conviction that responsive, anticipatory customer relations drives sales. Handling failures adroitly turns them into customer acquisition multipliers. I carried that religion into my entrepreneurial ventures and count that caring execution as a success factor.

But great CRM grows from a culture and processes integrated throughout a company’s execution channels. But focusing on it is rarely sexy because it requires people to contemplate failures in areas for which they’re responsible. Very few executives chomp at the bit to champion corporate anticipation of their professional face plants. It’s not so much pride goeth before the fall as pride causing the fall. So few companies list managing the post-purchase experience as a core competence. As a result, CRM efforts are rarely assigned superstar talent, commensurate authority, or the resources allocated to more conventional slices of revenue development initiatives. But organizational success increases when all members feel invited to anticipate failures and contribute to building the processes that convert production problems into customer loyalty and evangelism.
mclaren-mp4-12c

So when I’m subject to product failures that get poorly handled by companies that under invested in my post-purchase experience, it chaps my ass. It means the company has been lazy–because doing this well doesn’t have to be expensive. Conversely, when a company excels, I’m motivated to evangelize and repeat purchases. I damn sure take care of companies that take care of me. If a company earns my loyalty, that investment will return in their sales. I am not alone in this.

Porsche, and more specifically my local Porsche dealer’s service center, does this really well. Alas, my poster child for Exotic Disconnect failures in this blog post is McLaren, whose policies and dealer service center have repeatedly screwed this pooch six ways from Sunday.

As a car guy, I’ve embraced a life-long love affair with performance cars. I buy the most performant cars I can get my wife to approve, and then I drive them. By that I mean at every excuse, including tracking the shit out of them every chance I get. Unlike those who buy exotic sports cars primarily as garage ornaments so they can practice their wax-on/wax-off, kung-fu skills between occasional (and ginger!) Sunday drives, I stress my cars (safely and with all recommended maintenance, of course). As far as I’m concerned, if a company markets a car as bred for the track, that’s where the owner should be expected to spend at least some of their time. My friend the McLaren owner feels the same way. So we both track sports cars when life allows.

His car cost more than twice what mine did. Both have needed warranty repairs. Neither one of us is dismayed by this; shit happens, and complex systems are subject to failure. My car, the Porsche 997 GT3 pictured as the header image on this blog, has suffered component failures that could arguably be attributed directly to my repeated stressing the car’s systems in both autocross and HPDE events at various race courses. My friend’s McLaren problems have all been the kind of component failures that sometimes plague high-end boutique manufacturer’s hand-built cars and are often expected and accepted by those consumers as long as they’re professionally handled. None of the problems he’s had have anything to do with the way his vehicle is driven.

Enter the Exotic Disconnect. Contrast our experiences.

I have my Porsche service tech do periodic tech inspections of my GT3 before driving it 150mph in HPDE’s. He has discovered cracks in my car’s rotors that exceed the recommended spec (7mm) on two occasions.  His (and Porsche’s) attitude is: It’s a car that’s designed as a track car. The customer shouldn’t be penalized for using it for the designed purpose (I’ve heard that approximately 70% of GT3 owners track their cars). A warranty shouldn’t only apply to babied or garaged cars. From my position as a consumer, Porsche’s corporate culture says: We build performance cars that will stand up to performance driving. At the same time, they recognize that complex systems will have the occasional inevitable failure. So they’ve established processes that minimize customer inconvenience–solid communications, professional and personal service, and a free loaner car while yours is in the shop. The dealer’s service center reflects the manufacturer’s culture. They both recognize they’re links in a critical chain and handling the occasional failure is an investment in the brand and future sales, not just an expense to be minimized at any cost.

And now this blog post’s poster child: My friend bought a McLaren because his research indicated that McLaren owners tended to be more satisfied with their cars than Ferrari owners, and the McLaren MP4-12C was developing a reputation as both unbelievably capable on the track but also comfortable and reliable for daily use. Ferrari’s Exotic Disconnect cost them a sale. However, when the time came for my friend to send his McLaren in for its first annual service and a couple niggling warranty repairs, it took 3 weeks and multiple calls to get the dealership to pick up the car (the transport service is paid by the customer, which he knew going in, but the lack of follow through by the service center was frustrating). Strike one. Eventually the car was picked up. Then, nothing, not a peep from the service center. Ten days later he calls, and the car hasn’t been serviced yet. Another week goes by without communication from the service center. He calls and they’re “just about to get to it.” Strike two. Long story short, as the car approached its third week in what has begun to feel like a service black hole, my friend finally has to give the service center an ultimatum because he’s scheduled to drive the car in a parade and HAS to pick it up. The morning he begins the trip to the dealership, 340 miles away, it’s still not ready! Though the car was (just about) ready by the time he got there, it’d been a six week ordeal just to complete basic service and a couple of warranty repairs that weren’t dependent on parts availability.

Fast forward to last week. He’s driving his McLaren back from the barber shop. The 12C is still under warranty with less than 5000 miles on McLaren Left Rear Turn Signal Loosethe odometer. He pulls into his garage and gets out to find the left-rear turn signal light has fallen out of the fender and is hanging by the electrical wire. The car wasn’t hit or otherwise damaged; a light-assembly retaining tab had simply broken and it was obvious that light assembly would need to be replaced–something he could easily do himself upon receiving the part. No biggee, shit happens. So he emailed a description of the problem and a picture to the dealership’s McLaren service manager. The picture clearly showed the problem, and that there’d been no impact damage to the light assembly or surrounding fender. The piece just broke and fell out. He got no answer to his email. Several days later he calls and is directed to another service manager, who asks that the email be resent to him. My friend does so immediately. …a day later that service manager calls him back to say, “We will have to check with McLaren to see if that will be covered under warranty.”

McLaren service then added insult to injury when they called the next day to admit McLaren would cover the issue under warranty but they wanted the defective light (which still worked and was usable if held in with tape) sent to them before they would send out the replacement light. When my friend complained that would render the car inoperable for the 2+ weeks it would probably take for the part order and exchange, he was grudgingly told they could cross ship the items, but they would need his credit card so they would be able to charge him the cost of a new light if he didn’t follow through by sending the defective light back (remember, he’d sent a picture of it clearly showing it was broken and hanging out of the car).

As I heard this, I found myself thinking, “Are you freaking KIDDING me?” How does a company clever enough to build a world-class super car with such advanced engineering bumble such basic customer relations opportunities? They’re striving to sell vehicles to a market segment that is willing to buy cars that cost literally TEN TIMES the price the average consumer will pay, and McLaren can’t be bothered to streamline post-purchase problem handling with an eye toward making their customers feel valued?

When pleased, this McLaren owner is an evangelist. I mean, sometimes you can’t shut him up! And he typically buys an exotic super car every couple years and is happy to let others drive it to check it out. Like many in that community, he browses and occasionally participates in forums where people of like interests congregate and share anecdotes. All it takes for companies to harness his enthusiasm and benefit from his extensive network and communications with other super car buyers is to respect him as a customer. He’s not a prima donna; he merely expects a prestige company to reasonably manage their service links. There are well-understood process and market examples for establishing processes that flag failures in service scheduling, work quality, and streamlining expectation-exceeding responses to issues any technician should be able to evaluate as reasonably likely to fall under warranty and be empowered to handle. Do those things and that company will benefit from customer evangelism.

Why in hell would a company NOT care about having their customers voluntarily, enthusiastically, sell that company’s products for them? How dense do you have to be as an executive or dealership owner to forsake that kind of revenue multiplier?

Does my friend still love his McLaren? Yep. But he’s also pissed that his ownership satisfaction, which is a BIG part of owning a prestige, exotic car, has been degraded. In this case, McLaren, the McLaren dealer, and the McLaren service center chain had an enthusiastic customer that would have been a source of significant future revenues and referral sales. Instead, they motivated him to broadcast his dismay in conversation and online, potentially driving potential customers toward another brand.


Leverage your customers

My friend has heard from others that their service centers take better care of them, but my friend is stuck with the dealership closest to him. Consistency is part of complete brand management; it’s the individual’s experiences that drive their opinion of the brand.

My friend won’t buy another McLaren no matter how many cool videos journalists post in articles or to Youtube. Nor would I after talking to him. On the other hand, I’ll buy another Porsche and after talking to me, my friend probably will now, too. His future Porsche won’t be as exotic, as head-turning as his McLaren was, but he’ll expect to be happier with the ownership experience. He’ll feel respected and appreciated by Porsche. That’s important when you’re spending hard earned money.

Someone at McLaren should fall onto their sword for saddling their company with that kind of uncompetitive thoughtlessness.

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