China's new-vehicle buyers are becoming increasingly open to considering more brands, according to the 2017 China Sales Satisfaction Index (SSI) Study released on Thursday by J.D. Power, a global market research firm.
The study showed that when dealers attract 100 new customers, they simultaneously lose 110 old customers, with 90 percent of this customer loss happening at the dealers. This means their dealership performance in the "last mile" needs to be improved urgently.
"We've noticed that more and more buyers are becoming open to different brands… [Which] actually provides more exciting opportunities and challenges for dealers," said Ann Xie, senior research director at J.D. Power China, noting dealers need to focus more on operational efficiency and customer experience.
Online channels are being used more often to select vehicles, with 65 percent of new-vehicle buyers having used at least one online channel to research their purchase. One quarter of them consider online channels as the most influential factor, according to the study.
Customers born in the mid-1980s and 1990s made up 54 percent of buyers in 2017, up 5 percent year-on-year, and they are attaching more importance to the online experience when buying a car due to factors such as pricing transparency and brand reputation, Xie said.
"Dealers in the U.S. are more prone to sharing online information with their customers before they walk into the 4S [full service] stores, which is helpful for providing rich and personalized services to the customers when they arrive," Finbarr O'Neill, president and CEO of J.D. Power, told the Global Times in an interview.
The study also finds that the satisfaction gap between China's domestic car brands and mainstream international brands has narrowed by around 76 percent compared with 2016. The ratio of customers moving from international brands to domestic ones is on the increase in 2017.
In terms of China's domestic brands going global, O'Neill said, "It is crucial to understand the needs of different markets and make the first impression right because there is only one chance."
"It's also important to be future-oriented, embracing new disruptive trends such as the new-energy vehicle. China is expected to become a global leader in this sector in a decade based on its advantages in market size and relatively low cost of technologies," he added.
