Toyota Prius = Marketing Mastery

It was a month ago that I first read about the Toyota Prius adding solar panels to the top of their sunroof by 2010. At first thought, that is brilliant. As a driver is cruising down the road they can charge their battery even faster and use even less gas. Why didn’t I think of that?

While Toyota expects that the solar panels could increase mileage this is not the reason why they are adding solar panels to the sunroof.

It is obvious that Toyota has done their marketing research. In Japan especially, but also the US and Europe, people like to take naps in their car at lunch time with the air conditioning on full blast. They spend the 40 or so minutes cooling off in their car with the engine running. A waste of fuel? You bet. By watching this behavior and conducting focus groups Toyota recognized a need from the consumer and figured out a way to help these lunch time nappers. As it turns out, the surface area of one Prius sunroof would be just enough electricity to run the air conditioning.

Will this sell more Toyota Priuses? Not immediately. Will this increase customer loyalty? You had better believe it.

Customer loyalty is one of the most important metrics in the auto sales industry. As everyone knows it costs much less to keep a current customer than to go searching for new ones. More to the point, it has been proven that people who buy the same brand and model of car to replace their current brand and model of car are willing to pay about 3% more than a person new to that brand.

So, imagine you have the largest market share of hybrids, which Toyota does, and you have a relatively inexpensive way to “wow” them into only shopping for your cars again by showing you understand their lifestyle. It is a no-brainer. It is all of these little things that the “Big Three” in Detroit are missing. They do not effectively conduct marketing research which leads to products that consumers do not want to buy.

It is easy to see why Prius owners have such a high satisfaction rate with their car. They feel completely understood.

The impact to the Prius customer: 100% satisfaction

The impact to Toyota: 3% higher margins

The Big Three: Discounting SUV’s and Trucks

The process of buying a car

I have decided to buy my first car. After seeing the cost and frequency of repairs increase for my 1992 Cadillac Seville over the past two years I have come to the decision that it is time.

Being in the auto industry you would think I would have some fabulously sneaky insider knowledge about how to bend over dealers and get a screaming deal. Unfortunately, even though I have been through extensive training on dealerships, it basically comes down to sales and a basic working knowledge of the structure of dealerships. There really are no tricks.

Here is what I have heard from truth or rumor:

• Do not tell them the final price you want to pay
• Do not tell them you have a trade until after the price is negotiated
• Tell them you have been shopping around
• Get 3rd party financing from your local bank or credit union
• Come to them at the end of the month to get a better deal
  

This list is certainly not exhaustive, but I am sure it is nothing new to anyone reading this. We are all basically clueless. In order to minimize my cluelessness I tried to find out more.

How I began my search:
I did a ton of research on www.automotive.com which is a site that makes its money by dealers and private individuals listing their cars for sale. They have some of the best and most accurate listings that I have found when comparing competitors sites. They also have an exhaustive analysis of just about every single car being sold on the market.

Further Research:
After my research was complete I took a stroll to a dealership last Sunday, when they were closed, and looked at the brand of car that I wanted and what they had on the lot. I am looking for a 2003 so there was naturally a limited selection.

Why I made the decision to look now:
I was not planning on doing anything until I received my tax return, typical I know, but alas my car broke down again. Another $500.00 for the water pump. I guess I would break too if I had to pump 160,000 miles of water. Regardless that was my reason to contact the dealership. I was fearing that next big repair that would be the big repair. So there you have my buying motivation: Fear.

First Contact:
This morning, after driving my car to the shop and consequently arriving late to work, I got a wild hair and contacted the local dealership via their lead generation tool ...err website. you know the drill. You can click to view their inventory and if you do not see what you want you can fill out their form with all of the information. I clicked send and not one minute later I got a generic e-mail from the dealership telling me I would be contacted in 24 hours. It was probably 5 minutes after that that Shawn, my dealership representative, sent me an e-mail requesting more information. Impressive.

First quote:
I responded to his further inquiry and let him know what I wanted:(this is basically verbatim the e-mail I sent)

• 2003
  
• 30-50k miles
  
• price range of $18,000 to$ 24,000
• Anything but Red exterior
  
• Sunroof, Brembo brakes, spoiler, leather, no Navigation, 19inch performance wheels etc...
  

Based on my research there are probably 30 of these cars listed as of today in Dayton/Cincinnati/Columbus. Not exactly a rare car. Shawn responded back within an hour with a 2006, Red, 18 inch wheels, no spoiler, stock brakes, with Navigation and the price was $41,000.00 and was only good until 8:00pm today. Final offer.

Here's your test as a consumer: How did he do meeting my stated, specific requirements?

Idiots:
I politely responded that while I am sure that car was great, it met none of my requirements. It is not hard to imagine what happened on his end. The dealer probably told him that he has some 2006 that didn't sell and he is simply pushing it on everyone possible. It is the typical sales technique of "one size fits all" or "throw it on the wall and see what sticks". I filled out the form they specifically created for lead generation and they did not use any of that information.

*Insert rant*

Unfortunately that is where I am currently in the sales process and this article is getting quite long.

To be continued...