Transcript Slide 1

Methodology
AASA Image Campaign:
Phase 1 | Research of Independent
Service Professionals
Marketing Executives Council Meeting | March 17, 2009
© 2009 AASA and The Catevo Group | Confidential
Methodology
Methodology
 Review existing quantitative data
• Validate focus group data
• Challenge findings of focus groups
• Provide basis for focus group questions
– dive deeper into some of the issues
Marketing Executives Council
March 17, 2009
Methodology
 Our hopes:
• Obtain a better understanding of the service
community regarding value-added programs,
generic/name brands, country of origin,
decision-making processes, etc.
• Obtain a better understanding of the service
community for the development of an image
campaign
• Capture feedback on marketing messages and
spec creative created by Catevo
• Develop image campaign recommendations
Marketing Executives Council
March 17, 2009
Quantitative Data:
A Review of Existing Data
What We Knew
 Research was collected by the
Automotive Service Association and
Babcox Publications
 This data was used to validate some
of the findings of the MEC focus
groups and to enhance some of the
overall findings
Marketing Executives Council
March 17, 2009
ASA Surveys
 ASA surveys its members in 2007 and
2008
 The study examined the use of OEpurchased parts vs. aftermarket-purchased
parts and country-of-origin issues
 This study revealed that service providers
want more information about the parts
they purchase (i.e., country of origin,
specifications, certifications, labeling, etc.)
Marketing Executives Council
March 17, 2009
ASA Surveys
They still buy the majority of their products from
aftermarket sources
Marketing Executives Council
March 17, 2009
ASA Surveys
 The survey also showed that ASA
members really don’t have a good
understanding of the globalization
issue:
• How parts are sourced
• Overseas manufacture standard
validation
• They want to know more about “what
goes into the box”
Marketing Executives Council
March 17, 2009
ASA Surveys
60 percent of respondents said that aftermarket parts had a
positive impact on their business; 74 percent said OE parts had
a positive impact
Marketing Executives Council
March 17, 2009
ASA Surveys
About 29 percent said that quality problems with aftermarket
parts had a negative impact on their business, compared to
only 6 percent for OE parts
Marketing Executives Council
March 17, 2009
Babcox Tech Group Survey
 Results from Babcox’s every-other-year survey
of techs were very consistent with results from
the MEC focus groups
• Specifying particular brands
• Consumers’ preference in brands
• Where they receive information on
products
• Importance of factors in deciding on a
particular brand
• Type of parts purchased from OE dealer
Marketing Executives Council
March 17, 2009
ASA Surveys
 Contrary to the focus group findings
• The ASA study revealed that service providers
are concerned about the quality of products
outsourced from other countries
 Consistent with the focus group findings
• The ASA study found that service providers do
trust the parts they purchase from the OE
dealers more; they see them as more reliable
than parts purchased from aftermarket sources
Marketing Executives Council
March 17, 2009
Qualitative Data:
Focus Group Findings
Background
 Focus groups held in:
• Raleigh
• Chicago
• Los Angeles
 Included a mix of:
•
•
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Shop owners (50 percent)
Techs (26 percent)
Shop owners/techs (15 percent)
Service writers (9 percent)
Marketing Executives Council
March 17, 2009
Background
 Decision makers on the brand of
parts purchased
 Had at least five years of experience
 Shop had at least three service bays
 Worked on all makes of vehicles
 More than 50 percent of work was
not tires and oil changes
 More than 50 percent of purchases
were from aftermarket sources
Marketing Executives Council
March 17, 2009
Background
 Participants included representatives
from shops implementing “best
practices”
 Every effort was made to recruit the
“questionable” service shop
 Findings may be skewed
Marketing Executives Council
March 17, 2009
Key Findings
Key Findings
 Quality of aftermarket parts has
significantly improved
• Not a concern the way it once was
 Brand comes before country of origin
• Service community trusts the manufacturers
 House brands sell on price alone
• Sentiment was that house brands were reboxed generics that couldn’t compete on
quality
Marketing Executives Council
March 17, 2009
Key Findings
 Few people (if any) claim they buy generic
brands
• Only if nothing else was available (and not
safety-related)
 OE quality is still important
• Instills confidence in service community and to
consumer
 Quality first – everything else is secondary
• “Form, fit, function” is primary concern
Marketing Executives Council
March 17, 2009
Key Findings
 Online catalogs are a must
• Must include illustrations and be updated
 Full-line offerings are not that important
• Confusion among full-line vs. short-line
 Two-year/24,000-mile warranty coming
• This is an expectation among some in the
service community
 Training
• Lack of consensus on value of manufactures'
training programs
Marketing Executives Council
March 17, 2009
Key Findings
 Marketing programs not valued
• The service community wouldn’t mind seeing
marketing programs eliminated
 Value-added programs do NOT increase
loyalty
• Participants noted these programs do not
influence their purchasing decisions
 Trade magazines are effective
• Magazines were noted as the number one
source of product information
Marketing Executives Council
March 17, 2009
Specific Areas of Interest
Country of Origin
 Most note where the products
originate
 Some say they would prefer to buy
American but realize that is not
realistic
 They will ask country of origin if they
haven’t heard of brand
 Globalization is understood to be a
reality
Marketing Executives Council
March 17, 2009
Country of Origin
 Almost no one could tell a difference
in quality between U.S.-made parts
and non-U.S.-made parts
 Many said they could tell a difference
in the appearance of the product
 There is some lack of trust in parts
made in smaller, emerging countries
(e.g. Pakistan, Indonesia, etc.)
Marketing Executives Council
March 17, 2009
Country of Origin
 Summary: Brand comes before
country of origin; they trust that the
manufacturers have their best
interest in mind
Marketing Executives Council
March 17, 2009
Aftermarket Parts Quality
 Parts quality has improved greatly
over the past five years
 Most believe that Japan has
improved its quality the most
 Several noted it comes down to who
will stand behind their parts
Marketing Executives Council
March 17, 2009
OE vs. Aftermarket
 Many said OE has been overused
 However, OE is very important to
them and their customers
 OE instills confidence
 OE allows them to charge higher
prices
 Many only buy from dealers when
they have to
Marketing Executives Council
March 17, 2009
OE vs. Aftermarket
 Many only buy specific parts from
dealers (mostly electronics and
emissions)
 Dealer pricing has been reduced to
gain business (at times it’s lower than
aftermarket)
 Some view OE parts as “cheaper over
the lifecycle of the part”
Marketing Executives Council
March 17, 2009
OE vs. Aftermarket
 It is understood that dealer brands
are re-boxed branded parts (e.g.,
Motorcraft)
 Many see OE parts as the benchmark
for quality
 ASA data supports these findings
Marketing Executives Council
March 17, 2009
Off-Brand/Generic Brands
 Nearly all participants claim they do
not use generic parts
 They will use generic parts if only
generic available and a vehicle has to
be repaired
 Many said that they would test a
generic part on their vehicles first
 They would never install a safetyrelated generic part
Marketing Executives Council
March 17, 2009
Off-Brand/Generic Brands
 Comments included:
• “It would be suicide to use those parts”
• “Why put your reputation on the line?”
 A couple mentioned that they gave
the consumer a choice
• More than half replied they wouldn’t
give the choice
Marketing Executives Council
March 17, 2009
Off-Brand/Generic Brands
 A few participants who worked in
economically depressed areas said
they did what was needed to fix
vehicles at a low price
 Many said they don’t play the pricing
game
 In Los Angeles, the brand “Centric” is
gaining in popularity (once a generic
– now a recognized brand)
Marketing Executives Council
March 17, 2009
House Brands
 Many believe house brands are
generic parts in house-branded boxes
 Many have had problems with these
parts
 Many said they have been billed as
“OE” but are not near OE quality
 Salespeople only sell on price and do
not believe in the products
Marketing Executives Council
March 17, 2009
House Brands
 Quality issues have arisen, mainly
with brake products
 While house brands may save money
in parts, they could cost in labor
 It is understood that premium
products are name-brand products
 Several have not had issues and find
them a good value
Marketing Executives Council
March 17, 2009
Consumer Brand Preferences
 Consumers rarely ask for a brand
• “They don’t care; they trust us with their
vehicles”
 Some consumers say they are not
keeping their cars long and are
looking for the cheapest fix
• Need to be educated as to why a quality
repair is needed
Marketing Executives Council
March 17, 2009
Consumer Brand Preferences
 A few noted they will offer a labor
warranty but not parts warranty if the
name brand/OE brand is not
selected; as a result, consumers will
often choose name brand/OE brand
 Some say it is better to lose the job
than to install a cheap or inferior part
Marketing Executives Council
March 17, 2009
Definition of Quality
Form, fit, function
A part that never comes back
A part that outlasts the original part
A part that outlasts the warranty
A part that lasts a reasonable amount
of time
 A part that needs no modification by
the technicians
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
Marketing Executives Council
March 17, 2009
Definition of Quality
 As good or better than the OE part
 A part that performs the way it says it
is supposed to perform and beyond
 Fit and finish the same as the part
that comes with the vehicle
Marketing Executives Council
March 17, 2009
Importance of Value-Added
Programs and Services
Warranty
 Seen as a “given”
 Manufacturers should stand behind
their products
 Lifetime warranties are seen as junk
 Manufacturers should do a better job
resolving warranty claims – seen as
taking too long and too tedious
Marketing Executives Council
March 17, 2009
Warranty
 Many shops are offering two-year,
24,000 mile warranties
• They expect/hope their manufacturer
partners will support them if product
failure was manufacturer’s fault
Marketing Executives Council
March 17, 2009
Catalogs
 Industry format and standards mean
nothing to this segment
 Print catalogs are not used anymore
and can be eliminated
• Note: Many still use print catalogs for
filters and batteries
• They also considered themselves “old
school” and were generally older in age
Marketing Executives Council
March 17, 2009
Catalogs
 Online catalogs were used by virtually
everyone
• Illustrations are a must
• Must be updated regularly
• Several mentioned it helped when the
sales rep showed them how to use it
during one of the rep’s visits
Marketing Executives Council
March 17, 2009
Toll-Free Tech Lines
 Only a few mentioned that they use
these services
 Los Angeles participants noted some
weren’t open on West Coast time
 Many use iATN instead
• Others use Mitchell or other repair
guides
 It was noted that a quick resolution
line would be of assistance to some
Marketing Executives Council
March 17, 2009
Local Availability/
Widespread Coverage
 Product availability is the name of the
game
• If the preferred brand is not available,
they will choose a different brand
• A few mentioned they will find out how
soon the customer needs the repair
before making a decision about brand
Marketing Executives Council
March 17, 2009
Local Availability/
Widespread Coverage
 Widespread coverage, on the other
hand, didn’t seem as important
• They didn’t want the manufacturer to be
spotty in coverage and wanted the
popular applications covered
• Being an all-makes supplier was not
important
Marketing Executives Council
March 17, 2009
Marketing Programs/Rebates
Not valued at all
Take too much time
Too tedious/too much paperwork
Too many programs going on at once
Online games and programs not
valued either
 Many believe the programs can go
away
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Marketing Executives Council
March 17, 2009
Marketing Programs/Rebates
 Some mentioned lower prices would
be nice but realized the
manufacturers couldn’t control the
price directly
 Do value better point-of-purchase
displays to help sell (cutaways, good
vs. bad, new vs. old, etc.)
Marketing Executives Council
March 17, 2009
Field Sales Reps
 Some said they appreciated the visits
by sales reps
• These tended to be the smaller and midsized shops
 The best reps are those who know
something about the product
 Others said the best are those who
can truly go back to corporate and
make a difference
Marketing Executives Council
March 17, 2009
Field Sales Reps
 Many said the reps just get in the way
 They were seen as valuable if they
could visit and teach something
unknown or resolve an issue
 Most said they were too busy for reps
unless reps provide significant value
 Most said reps should not come late
in the day
Marketing Executives Council
March 17, 2009
Training Programs
 Responses ranged from “don’t need
manufacturers to provide training” to
“can’t get enough of it”
 Some get enough from third-party
sources
 Only a few using online training
programs
Marketing Executives Council
March 17, 2009
Training Programs
 The negative:
• Too commercial
• Too advanced for the beginning techs
• Not advanced enough for the
experienced techs
• Old information (focus on a new
technology)
• Instructors reading out of a book
• Manufacturers need to fill gaps in the
training offerings
Marketing Executives Council
March 17, 2009
Training Programs
 The positive:
• Manufacturers seen as the engineers
and researchers (more credible)
• Would send their techs to training if
seen as valuable
• Want to focus on reducing comebacks
rather than selling more products
Marketing Executives Council
March 17, 2009
Overall Importance
Marketing Executives Council
March 17, 2009
Loyalty to Manufacturers Who
Provide Value-Added Programs
 There is very little
 Some noted the exception is the period
once they return from training
 Many noted they wouldn’t change brand
unless brand quality slipped
 Loyalty comes from providing a quality
product
 Majority felt industry would not be hurt if
these programs were eliminated
Marketing Executives Council
March 17, 2009
Decision-Making
Process
Decision-Making Process
Top considerations when deciding on a part:
Marketing Executives Council
March 17, 2009
Decision-Making Process
When you are placing an order for a particular part,
how often do you ask for a specific brand?
Marketing Executives Council
March 17, 2009
Decision-Making Process
When you are placing an order for a particular part,
how often do you purchase a brand recommended by
your aftermarket supplier?
Marketing Executives Council
March 17, 2009
Decision-Making Process
When you are placing an order for a particular part,
how often do you choose the least expensive part?
Marketing Executives Council
March 17, 2009
Decision-Making Process
When you are placing an order for a particular part,
how often do you only select the same brand than
that of the one you are replacing?
Marketing Executives Council
March 17, 2009
Obtaining Information
Obtaining Information
 Trade magazines were number one
Note: They do not read them – just “skim”
through them
• Motor Age, Underhood Service and
ACDelco’s Intune were the most
mentioned publications
• Chilton and Mitchell repair guides were
also mentioned
Marketing Executives Council
March 17, 2009
Obtaining Information
 Several noted they went to trade
shows (AAPEX, SEMA, CARS, local
ASA events), or browsed the Internet
(iATN)
 Some relied on local organizations
(IGOA in Raleigh and ASC in Los
Angeles)
 Half relied on getting info from their
suppliers (e.g., CARQUEST rep)
Marketing Executives Council
March 17, 2009
Reaction to Marketing
Messages
Marketing Messages
Why Take the Risk?
This theme focuses on the question of “why
take the risk on gambling with your
livelihood by choosing a product from an
unproven source?”
Independent service providers strive for
customer loyalty and cannot take the chance
of losing core customers
Marketing Executives Council
March 17, 2009
Marketing Messages
"Good Enough" Never Really Is
Relying on short-line manufacturers for parts
doesn't always yield the best results for techs,
shop owners or their loyal customers
This theme also appeals to the inherent pride
that independent garages bring to their craft;
after all, if the standards of quality that go
into the overall repair job are so much higher
than the competition, shouldn't the quality of
the replacement part be, too?
Marketing Executives Council
March 17, 2009
Marketing Messages
Fool Me Once. Only.
This theme shows what would happen if the
wrong decision was made and the damage
that might occur to a customer relationship
because of a poor decision about a
replacement part
This theme plays up the pain that awaits
independent garage owners who take the
cheap way out with inferior parts lines: lost
loyalty, re-dos, unfavorable word-of-mouth,
etc.
Marketing Executives Council
March 17, 2009
Marketing Messages
 All three of the messages resonated with the focus
groups. “Why Take the Risk?” scored the highest.
Marketing Executives Council
March 17, 2009
Reaction to
Spec Creative
Spec Creative Review
Approximately half of respondents preferred
the ad on the left. The other half preferred the
ad on the right.
“Pride” Ad
Marketing Executives Council
“Fear” Ad
March 17, 2009
Spec Creative Review
 Those who liked the “pride” ad:
• Felt the “fear” ad was too negative
• Felt the “fear” ad spoke to the positive aspects
of the independent aftermarket (loyalty, doing
the job right, customer satisfaction)
 Those who liked the “fear” ad:
• Liked the “in-your-face” approach and the
shock value of it
• Felt it addressed what professionals want to
avoid
Marketing Executives Council
March 17, 2009
Spec Creative Review
 Additional findings:
• Shop owners and older focus group
participants preferred the “pride” ad
– Shop owners noted that the “pride” ad spoke to one
of the scariest aspects for the independent
aftermarket service provider: losing a loyal customer;
much like real estate, it is more expensive to obtain a
new customer than to retain a loyal customer
• More of the younger focus group participants
and technicians preferred the “fear” ad
Marketing Executives Council
March 17, 2009
Would Advertising Work?
 Many thought the ads were “preaching to
the choir”
 They thought that the shops who most
often at fault for buying/installing subpar
parts would be the shops who are not
generally committed to the industry and
who do not belong to associations, attend
trade shows or read trade magazines
 So, how as an industry do you reach out to
them?
Marketing Executives Council
March 17, 2009
However…
 Many of the focus group participants
believed that an image campaign would be
useful because:
• It would reinforce always doing the right thing
(“don’t cut corners”)
• The magazine could be passed around (from
tech to tech, from shop to shop)
• Many of the technicians at the “good” shops
today will own a shop in the future so this is a
way to invest in the future
• It’s better than doing nothing
Marketing Executives Council
March 17, 2009
But…
 The groups did agree that advertising
alone is not the answer
 Reaching out to the shops that offer the
$12.95 oil changes and $69.95 brake jobs
will be a major challenge
 Ultimately they are the ones who are
jeopardizing the image of the independent
aftermarket due to their unprofessional
business standards and by installing parts
of questionable quality
Marketing Executives Council
March 17, 2009
Summary of Key Points
Validating Existing Beliefs
 Brand comes before country of origin
 “House brands” sell on price and price
alone
 No one claims they buy generic parts
 OE quality is important
 Form-Fit-Function is primary . . .
everything else is secondary
 Trade magazines can be effective
Marketing Executives Council
March 17, 2009
Possible Surprises
 Quality of aftermarket parts has improved
 Print catalogs have become obsolete
(online catalogs a must)
 Full-line offerings not that important
 2-year, 24k mile warranties making a mark
 Marketing programs not valued
 Value-added programs don’t increase
loyalty
 “Low-end” shops impacting whole industry
reputation
Marketing Executives Council
March 17, 2009
Why the Research Worked
 Validated industry consensus
 Revealed some unknowns
 Countered conventional thinking
Continued . . .
Marketing Executives Council
March 17, 2009
Why the Research Worked
 Contradicted original strategy and
messaging:
• “Preaching to the choir” on quality
• Lack of loyalty toward value-added programs
• “Short-line” vs. “full-line” argument lacked
resonance
• Campaign target should be changed, expanded
• Audience of image campaign should be on
“low-end” service shops
Marketing Executives Council
March 17, 2009
The Road Ahead
The Road Ahead
 Realizing budget is an issue for 2009,
it is important to start the “buzz”
going at least on the trade side.
 If budget becomes available,
expanding the “buzz” in 2010 is
recommended.
Marketing Executives Council
March 17, 2009
The Road Ahead
 Remainder of 2009
• Trade PR
• Advetorial Campaign
• Industry Award Program
Marketing Executives Council
March 17, 2009
Potential Next Steps
(a springboard for discussion)
Supplier Image Initiative
Next Steps
To target repair professionals  Technical Article Series on Product
Quality
 Collaborate with trade associations to get
message out – ASA
 Address business practices
Marketing Executives Council
March 17, 2009
Supplier Image Initiative
Repair Professional – “Product Quality”

•
6-Part Series: Feature Articles
1.
2.
3.
4.
5.
6.
What’s in a Brand?
Keeping Customers for Life
Value of Value Lines
Beyond Price: Value Added Services
Who Supplies the Tail?
We are All in this Together
Marketing Executives Council
March 17, 2009
Supplier Image Initiative
Next Steps
To target channel partners  Advertorial Campaign:
–
–
–
–

Members devote one full page ad to campaign from
existing Marketing budget (divert funds)
Negotiate an advertorial page for our message
Member’s ad remains in tact
No additional cost to member
Industry Award:
–
–
–
Supplier Excellence based on our criteria
Voted on by channel partners
Promoted throughout the industry
Marketing Executives Council
March 17, 2009
Supplier Image Initiative
Jobber / Distributor – “Recommended
Best Practices of Value Added Suppliers”

•
•
Supplement with full-page trade ad
6 Feature Articles
1.
2.
3.
4.
5.
6.
What’s in a Brand?
Definition of Full-Line
Value of Value-added
Direct Importing: Risk v. Reward
Who Supplies the Tail?
We are All in this Together
Marketing Executives Council
March 17, 2009
Supplier Image Initiative
Supplier / Manufacturer – “Supplier
Image”

•
Special Reports
1.
What’s in a Brand?
Selling Against Short Lines
2. The Value of Value-Added Services
Quantify do not Just Give Away for Free
3. Protecting the Aftermarket
Maintaining consumer confidence
Marketing Executives Council
March 17, 2009
Methodology
Thank You
Marketing Executives Council Meeting | March 17, 2009
© 2009 AASA and The Catevo Group | Confidential