J.D. Power and DealerRater Report: Consumers' Ideal Automotive Salesperson Is a Negotiator to Help Get the Best Deal

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May 20, 2015, 01:00 ET

WESTLAKE VILLAGE, Calif., May 20, 2015 /PRNewswire/ -- Given the choices of negotiator, educator¹ and facilitator, 46 percent of U.S. new-vehicle buyers say the most important role that salespeople play in the purchase process is that of a negotiator to help them get the best deal, according to the May 2015 PowerRater Consumer Pulse.

Consumer Pulse is a monthly analysis developed jointly by J.D. Power and DealerRater. An alliance between J.D. Power and DealerRater integrates each company's capabilities to gather comprehensive vehicle shopper feedback based on J.D. Power's customer satisfaction research and DealerRater's customer ratings and reviews of car dealerships.

As a negotiator, the salesperson's role is to assist buyers in arriving at a mutually acceptable deal,² which includes coming to an agreement on the new vehicle's price and the value of the buyer's trade-in vehicle, if they have one.

Key Findings

Another 42 percent of new-vehicle buyers prefer that salespeople take on the role of educator, while 12 percent prefer facilitator.
Given a relative sensitivity to vehicle affordability, the percentage of U.S. buyers who want their salesperson to be a negotiator is slightly higher among mass market vehicle buyers (47%) than among luxury buyers (43%).
At the brand level, buyers of Nissan (53%) and Kia (53%) vehicles are among the most likely to want their salesperson to be a negotiator; whereas buyers of Subaru (35%) and Audi (40%) are among the least likely to want their salesperson to be a negotiator.
According to the J.D. Power 2014 U.S. Sales Satisfaction Index (SSI) Study,^SM 66 percent of new-vehicle buyers say they negotiated with their salesperson to get a better deal.
Despite the strong desire to negotiate vehicle purchase terms, 45 percent of buyers indicate it took a moderate amount of effort to get a better deal.

As shown in data collected by DealerRater, the art of negotiation is alive and well in the U.S. automotive market.

"Given that people so often turn to the Internet and smartphone apps to research vehicles—and can even see what others have paid for a similarly spec'd vehicle—the results of our analysis were somewhat surprising; but it's clear that consumers still want salespeople to be part of the overall purchase process," said Gary Tucker, chief executive officer of DealerRater.

According to the 2014 U.S. Sales Satisfaction Index Study, negotiating can often lead to a positive outcome for buyers, as a significant percentage of new-vehicle buyers indicate they received a lower price (55%); a better trade-in value (32%); and/or another kind of purchase incentive, including cash, a preferred interest rate, free service or additional vehicle features (31%).³

"Among the generations,⁴ Gen Y buyers negotiate the vehicle price 72 percent of the time, while Pre-Boomers negotiate only 61 percent of the time. Gen X negotiates 66 percent of the time and Boomers 64 percent of the time," said Chris Sutton, vice president, U.S. automotive retail practice at J.D. Power. "In an increasingly digital world where everything's at our fingertips, savvier consumers are armed with a lot more information to bring into a negotiation than was readily available in past generations."

Study data also suggests that satisfaction with the overall purchase experience is lower among new-vehicle shoppers who attempt to negotiate a better deal than among those who don't (793 vs. 844, respectively, on a 1,000-point scale).

"Dealers would do well to examine their approach to customer negotiations to close this satisfaction gap to avoid misconceptions and frustrations with in-store interactions, as well preserve loyalty and advocacy for the product being sold, person selling the product, the place where the consumer buys the product and its overall price," said Tucker. "Employee review pages are a great example of how we've seen dealers achieve this. By making connections and establishing trust with the salesperson before going into the store, anxiety is lessened and the overall sales process goes faster and smoother."

On average, new-vehicle shoppers spend 56 minutes negotiating with dealership staff, which has remained relatively unchanged during the past six years.

About J.D. Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info
About McGraw Hill Financial www.mhfi.com
About DealerRater http://www.dealerrater.com/company/

Media Relations Contacts
John Tews; J.D. Power; Troy, Mich.; 248-680-6218; [email protected]
Wendi McAden; DealerRater; 424-903-3644; [email protected]

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power or DealerRater. www.jdpower.com/corporate www.DealerRater.com

¹ Educators provide insights and information about vehicle models, trim levels, options and features, and facilitators provide relational information about the dealership
² Based on a survey conducted between April 22 and May 4, 2015, of 8,098 consumers who wrote a review on DealerRater.com after recently purchasing a new vehicle
³ This is a multiple response question in SSI
⁴ J.D. Power defines generational groups as Pre-Boomers (born before 1946); Boomers (1946-1964); Gen X (1965-1976); and Gen Y (1977-1994).

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SOURCE J.D. Power