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Fighting the Stigma of Car Rental Commoditization

Digging into the J.D. Power and Associates Rental Car Satisfaction Study reveals ways to combat the low-rate game, as well as one proven tip for improving your customer satisfaction score.

November 9, 2012

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The results of the 2012 J.D. Power and Associates Rental Car Satisfaction Study are in. The industry’s average overall customer satisfaction score beat the industry high set in 2006. Coming out of the Recession, the gains in customer satisfaction in the car rental industry continue to best those of airlines and hotels. Who says car rental has to be the bastard stepchild of the travel industry!

That’s great news. But the industry continues to battle the stigma of commoditization. Indeed, “cost and fees” consistently remains the top factor in choosing a rental company. Stuart Greif, vice president and general manager of the global travel and hospitality practice at J.D. Power and Associates, challenges the industry in this regard, asking car rental brands — in an encouraging tone — “to fight that commoditization by addressing the needs of customers in a way that can both differentiate their brands and deliver an even better customer experience.”

Yes, a low price may drive the selection of a car rental company, but there is more to this equation. Greif makes the point that in the hotel world, Ritz Carlton has highest level of satisfaction in cost and fees. In other words, price is really about value. “Otherwise it comes down to price, price, price, and you’re only as good as your lowest price,” he says.

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In the 2012 study, Enterprise Rent-A-Car scored highest in cost and fees, followed by National, Alamo, Hertz, Avis and Budget. The companies with the lowest rates are not at the top of this list. Clearly, consumers are calculating other aspects of the experience into cost and fees. “We know from our research that folks that go beyond satisfaction to ‘delight’ will open their wallets wider, allowing those companies to command price premiums,” Greif says.

One increasing factor in improving customer satisfaction is the use of technology.

Technology reduces the human touch points in the process, which in turn reduces time, which positively affects customer satisfaction. J.D. Power scores reveal that the use of counter bypass systems such as kiosks directly correlates to higher scores, while having to go to the rental counter produces lower scores.

There are some good ideas using technologies waiting to be implemented, such as the use of GPS to show the route of a shuttle bus. If you can’t add more shuttles, at least you can tell the customer where the shuttle is, which would allow the customer to wait inside on a chilly day until the bus arrives, for example.

The easy integration of personal technology and the rental vehicle will become important, such as pairing a smartphone to talk hands-free or a device to play your own music library.

Upon return, systems are starting to be used that read actual fuel consumption. Taken further, GPS could be used to automatically transmit an odometer reading. The car could be driven through a camera system to check for damage. A receipt could be delivered via email. The customer wouldn’t interact with an employee at all.

The technology component is no doubt daunting, especially for smaller operations with limited budgets. But technology simply can’t be ignored. Greif reminded me of the saying, “Today’s innovation is tomorrow’s expectation,” with Wi-Fi in hotels and on airplanes a good example.

Take heart; there is another direct correlation to customer satisfaction, the human touch points in the process. “Technology helps us bypass human touch points, which improves customer satisfaction,” Greif says. “But the remaining human touch points are what bonds you to the brand.”

By some measures the correlation of staff attitude to customer satisfaction is even greater than technology. J.D. Power asks survey participants if they were greeted with a smile by RAC personnel in four human touch points of the transaction: shuttle driver, staff member during pickup (usually at the counter), exit gate personnel and staff member at return. For each of those touch points that greeted the customer with a smile, the average gain in score is a whopping 134 points. Luckily, a smile still costs nothing.

The smile itself may seem almost trivial, but it’s really representative of that company’s service. “If somebody has a warm smile, they are making you feel valued as a guest,” Greif says.

I’ve been asked a few times if I knew the secret to getting a better J.D. Power customer satisfaction score. And there you have it, smile.

For insights into how Enterprise regained the top spot in the 2012 J.D. Power and Associates Rental Car Satisfaction Study, click here.

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Author Bio

Chris Brown

Executive Editor

Chris Brown is the executive editor of Business Fleet Magazine and Auto Rental News. Through these publications, online newsletters, trade events and associations, Chris covers all aspects of the fleet world, including fleet management, manufacturer fleet activities, the fleet leasing industry, vehicle remarketing, rental industry news, car rental taxation and legislation.

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