Toyota Australia is embarking on a significant grassroots overhaul from its dealer network up, as it chases a return to the 20-plus per cent market share it recently enjoyed.
Simply put, some elements of its business locally “frustrate the customers beyond belief”. Those are the frank words of Toyota Australia executive director of sales and marketing Tony Cramb, who spoke with us very candidly about his brand’s performance locally this week.
Right off the bat, Cramb says the company wants to end the “gaming” process endemic to car dealerships of all stripes. The company asserts that many customers — or ‘guests’, as Toyota has decided to call them — are not interested in negotiating and haggling with a pushy salesman.
Just as the company introduced capped-price servicing years ago to kill perceptions that it was “ripping people off” in service, the company now wants greater clarity of simplicity for its ‘guests’. The name of the game is to boost its already enviable retention rates.
“We’ve had a blinding flash of the obvious in the last couple of years, certainly in the last 12 months, that the most valuable thing we have is a loyal base of customers that have been with us a long time,” Cramb said.
“And that’s a huge database of people that have been with us for many years that I’m sure other franchises would kill to get and have.”
Toyota remains Australia’s dominant new vehicle brand, but its share of 17.9 per cent is a few points lower than it was just a couple of years ago. At one point, the company stated its desire for a 25.0 per cent share of Australia’s increasingly fragmented and competitive market.
“I’m definitely confident we can get back to 20 per cent-plus share, but our focus globally is looking after each customer one day at a time, one customer at a time. We’re very focused on the experience,” Cramb said.
He added: “We’ve realised very quickly that our focus of attention needs to be on that group... market share is a result… if we take care of each customer and they love the experience, not only will they come back, but they’ll spread the word.
“Now that’s happened largely in the past, but there are some things in our business which frustrate the customers beyond belief.
“The negotiation process in buying a car is one that for a portion of the population… they don’t want to go through that,” Cramb said. “They find it a gaming process that isn't necessary.”
That’s one reason why Toyota launched the new Camry this week with permanent driveaway pricing. While all car makers offer driveaway pricing in some form on their public sites, Toyota’s is fixed across the board, irrespective of state.
“We’ve eliminated that [former rigamarole] and agreed with dealers. The customer can then make their case logically to move up the grades if that’s what they desire. All we have to work out is to get them the one they want in the colour they want,” Cramb said.
It’s all part of Toyota’s wider plan to re-train its entire 10,000-person dealer network to a new set of standards. The clarity with car buying is designed as an extension of the clarity it seeks in servicing.
“One of the things honestly, and this is dirty laundry on the table, is we found we had some dealers that were charging more than the amount through other services, and through up-sells… that’s no longer allowed.
“We’ve said to the dealers we won't accept that any more. If you do that, there will be consequences. And they like that too, the dealers… it’s got the full support of the dealers council, we’re not forcing it on the dealer group.
“We have issued to every dealership around the customers, an inch-thick book of standard expectations of every department and every touchpoint with the customers.
“We will assess their performance, the book is the ninth standard of nine. [We will] send people out to monitor twice a year.
“We’re not on some Pollyanna kind of exercise where we think we don’t have to worry about product, price or marketing,” he added.
"There’s some basics we have to attend to, but we’re trying to inspire our people to provide a service where the customers can’t imagine a world without Toyota.”