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GM Hopes to Turn Frustrated Owners into Loyal Buyers

Maker dedicates new Customer Engagement Center in Detroit.

by on Dec.09, 2013

One of the growing team of "advisors" at the new GM Customer Engagement Center.

For decades, General Motors viewed frustrated customers as a costly nuisance.  Today, the maker says, it wants to turn them into loyal owners. At least, that’s the strategy behind the new Customer Engagement Center officially opening at the GM Technical Center in the Detroit suburb of Warren, Michigan.

The facility, which will eventually employ nearly 350 “advisors” and managers, is part of a dramatic shift in the way GM wants to do business – a recognition that in today’s crowded and highly competitive automotive market it doesn’t take much to send buyers over to your competition if they aren’t treated right.

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“I don’t know if there’s anything more important than getting a customer to come back,” said Mark Reuss, president of GM’s North American automotive operations, during a tour of the new facility which consolidates earlier call centers based as far away as Buenos Aires, Argentina.

GM Pres Mark Reuss and Global Quality and Customer Service Director Alicia Boler-Davis.

The Customer Engagement Center is a so-called Level II facility.  It’s where owners of GM products can turn if they have a nagging issue that dealers either can’t or won’t repair, whether a defective transmission or something as simple, yet frustrating, as an in-car infotainment system that won’t properly pair with an owner’s smartphone.

In year past, the facility would have been called a “complaint department,” explained Jim Moloney, who serves as general director of the Michigan center and others around the country. “We viewed them as cost centers,” where the goal was to do as little as necessary – and spend as little as possible, Moloney explained.  Today, GM has given its advisors more flexibility to do what it takes, even if it means authorizing an expensive repair that might not have been required under an owner’s warranty.

(GM makes gains in Consumer Reports’ auto reliability study. Click Here for details.)

It’s part of a broader focus on resolving the problems that led millions of owners to abandon GM over the years – and contributed to the issues that eventually drove the maker into bankruptcy in 2009.

“We can’t afford to lose a single customer,” said Moloney, echoing GM President Reuss.  Indeed, industry studies have suggested that it can cost as much as 10 times more to win over a new buyer – through advertising and other efforts – compared to what it takes to keep an existing owner, so manufacturers like GM are starting to recognize even an out-of-warranty repair can be treated as a cost-effective marketing tool.

The Detroit maker began shifting its approach to both quality and customer service in the years leading up to its dive through Chapter 11 and has sharpened its focus since then. During the Monday morning dedication, Global Quality and Customer Service chief Alicia Boler-Davis said internal metrics show the effort is paying off.  For one thing, issues reaching GM call centers are taking half as long to resolve as just a year ago. And a growing number of owners who take an issue to one of the centers now will check the “Very Satisfied” box when the issue is resolved.

Those internal reports are being echoed by independent, third-party party studies such as the J.D. Power and Associates Sales Service Satisfaction study and several recent surveys by the influential Consumer Reports magazine which, for 2014, gave 16 GM products a coveted Recommended Buy endorsement.

“We’re often able to convert an unhappy customer into a loyal one,” proclaimed Boler-Davis.

(No more “crappy cars,” proclaims GM product development chief Mary Barra. Click Here for the full story.)

GM is by no means the only maker today putting a premium on customer service.  For Hyundai, it became a critical step in the process of rebuilding a tarnished brand image, starting with the launch of the maker’s then industry-best 10-year warranty. Of course, it helped to have vehicle quality on a steady upward climb.  Indeed, GM’s Boler-Davis noted that even with a more customer-friendly policy, the maker’s warranty costs have been dropping as new vehicles come off the line with better quality.

The trade publication Warranty Week estimates that GM is spending an average of about $400 a vehicle this year compared to around $600 for arch-rival Toyota.  Significantly, GM has had a lower warranty cost average for five year running when compared to Toyota, a brand traditionally known for its quality and reliability.

The primary responsibility for the new Customer Engagement Center is handling customer calls but the facility will also serve as a monitoring post allowing GM to more broadly track what owners are saying about its products.  And engineers will soon be able to listen in on calls to see if there’s a specific issue that they may need to address with the company’s products.

(Hyundai topples Toyota in repair rankings. Click Here to find out how.)

Even the best vehicles still run into trouble, however, and the various GM Customer Experience Centers currently handle about 5.7 million calls annually.  If it means adding more staff to meet the market’s needs, Boler-Davis notes there is room to keep growing at the renovated facility on the northern edge of the GM Tech Center campus.

“Every interaction with the customer,” she explains, “is an opportunity to develop and enrich a relationship with them.”

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One Response to “GM Hopes to Turn Frustrated Owners into Loyal Buyers”

  1. Jorge M. says:

    It must be cold in that Customer Engagement center if the employees need to wear what appears to be a leather jacket indoors?