SHANGHAI (AdAgeChina.com) -- In a column last year, I suggested domestic Chinese automakers should take a focused approach as Shanghai Automotive Industry Corp. (SAIC) has done towards building a respected brand.
Today, most of these companies are still struggling on that front, because their efforts are focused on the manufacturing side. Companies like Chery and Geely keep rolling out new models, which they hope can lift their brand recognition.
They should take more cues from their older brother in Shanghai. SAIC's experience has shown that to build a respectable brand one also needs to do well on the service side.
Since its launch at the Beijing auto show in April l2008, SAIC's Roewe 550 compact sedan has won wide acclaim for its graceful design and the fine materials it uses.
The Roewe 550 is not cheap. It has a starting price of 127,000 RMB ($18,594), twice the average cost of the cars built by other domestic Chinese automakers.
But the car is selling well. In the first half of this year, sales tripled to 33,424 units over the same period last year, according to Automotive Resources Asia (ARA), a J.D. Power unit.
What is behind the car's strong sales growth?
Its attractive styling and impressive fit and finish have certainly helped. But equally important are the high quality services SAIC and its dealers offer their customers.
According to the J.D. Power Asia Pacific 2009 China Customer Service Index Study, Roewe ranks fourth in customer satisfaction with authorized dealer after-sales service, behind only Guangzhou Honda, Lexus and Mercedes-Benz.
The study measures customer satisfaction with maintenance and repair service at authorized dealerships at 12 to 24 months of vehicle ownership. It examines five key factors: service quality, vehicle pickup, service initiation, service adviser and service facility.
On a 1,000-point scale, Roewe scored 846 points. That's the highest ranking a domestic Chinese brand has ever achieved in the annual study, according to Mei Songlin, general manager of research at J.D. Power Asia Pacific.
High levels of satisfaction with after-sales service will bring in repeat business as well as new customers.
For brands with the highest levels of service satisfaction, 34% of their customers say they "definitely will" recommend the car brand to friends or relatives, while 16% said they would repurchase the same brand, according to the study.
By contrast, recommendation and repurchase rates are merely 20% and 8%, respectively, among buyers of brands with low levels of customer satisfaction with service.
From the Power study, it's clear that giving customers good service is vital to building a brand that commands loyalty.
Too bad, then, that Roewe is the only domestic brand earning more than the industry average of 817 points. In this area, SAIC's compatriot competitors have much work left to do.
Yang Jian is the managing editor of Automotive News China, which is also published by Crain Communications.
Return to the AdAgeChina home page here