Your Car, Sir: How Ultra-High-End Car Buying Is Different

Bentley Rancho Mirage-RA

Visit an ultra-luxury brand’s showroom, and you’ll find the espresso machine is always on, the sales representative likely knows your social media profile, and a complementary bouquet—with blooms to match your new car’s paintwork—is going home with you at delivery time.

Yes, mass-market brands emphasize customer service, but retailers of the world’s most prestigious marques practice refinements that mainstream dealerships can’t manage. High-end retailers anticipate your perceptions of the ultra-luxury car-buying experience, and they’re prepared to go extra lengths.

“We have to meet that expectation immediately,” says Stuart McIntosh, general manager of Aston Martin sales at O’Gara Coach Company, in Beverly Hills. McIntosh and his staff offer tea, coffee, or a soft drink to one and all. “We make sure everybody is treated equally, whether they’re taking pictures for their Facebook page or intend to buy a couple of cars.”

McIntosh describes a subsequent process of relationship building that requires tact and forbearance. “The main factor that goes into being a salesman for one of these brands,” he says, “is patience.” While the occasional customer wants a new car immediately, there are also those “who want to look at half of the color and trim combinations available.” And at Aston Martin, there are over 3 million color and trim combinations available, according to spokesman Matthew Clarke.

Given this required level of discretion, it’s safe to assume the sales representative probably wasn’t discounting mattresses last week before moving up to the more profitable arena of car sales. In fact, McIntosh’s team members have passed an aptitude test that he says indicates not only patience but also honesty and trustworthiness. It’s likewise safe to assume that the rep is used to dealing with wealthy people. And that he or she really digs the cars.

“Most of them are car lovers,” says Richard Koppelman, president of Miller Motorcars, a multi-line luxury-car dealership in Greenwich, Connecticut. “They probably didn’t come and say, ‘I can make $10 more selling Ferraris or Aston Martins.’ Sometimes we get people who had been in the luxury-goods area. The people we hire have to have a passion.”

And that passion may include being at home on the track, where some brands invite the favored few for test-drives. McIntosh’s dealership has a membership at the Thermal Club, a private circuit near Palm Springs. In the fall, the dealership invites 20 to 30 prospects “who we feel are in position to purchase by the end of the year.” They stay at the Ritz-Carlton, dine at Mastro’s Steakhouse, sample Aston Martin models on the track, and go for hot laps in a Vantage GT4 with a pro driver.

Track driving is a tactic used by Lamborghini, too, as part of what Alessandro Farmeschi, chief operating officer of Automobili Lamborghini America, calls “a highly customized one-to-one relationship that starts as soon as they get in touch with us.” The racetrack experience, Farmeschi says, is “part of the beauty of selling this product.”

By whatever avenues (or straightaways) the purchase decision is made, eventually it’s time to sit down and negotiate. Here’s where every dealer has something in common: floorplanning charges—the amount paid to the manufacturer for subsidizing inventory—make him eager to move the metal (or carbon fiber).

Having eight Rolls-Royces in a showroom, as we counted at Desert European Motors, a multi-line ultra-luxury and exotics dealership in Rancho Mirage, California, could be a costly proposition. But floorplanning affects even a small dealer. Greg Albers, co-owner and general manager of Bentley Zionsville, which is near Indianapolis, suggests the well-qualified buyer usually has some leverage.

“Generally, if you have a product that’s brand-new and it’s hot, for a period, you can get sticker price,” says Albers, who notes that special-ordering a bespoke car leaves less room to dicker. Otherwise, though, “you’re dealing with businessmen who’ve been successful, and they’ve been successful by being good negotiators. Everybody wants to get the best deal they can. People are not foolish with their money. For the most part they’d like to know they’re getting a good deal.”

At least half of Albers’ buyers pay cash, with a substantial percentage of others leasing through their businesses. And where Indianapolis and Beverly Hills have something else in common is in offering an extended warranty. “Some want that, some don’t. We offer it to them,” Albers says.

Finally, it’s time for delivery. And indeed, McIntosh’s Aston Martin buyers really do receive a bouquet, or golf bag, that matches the car.

As for handover, there’s another split in buyers’ preferences. “Some people do just want you to give them the key, and they’ll read the book,” Albers says. On the other hand, dealers are quite willing to demonstrate all aspects of the car. “It makes their experience better, saves them calling two days later and asking, ‘How do I open the gas door?’ ”

So what’s the best example of special accommodations in the familiarization process? When Miller Motorcars recently delivered a car to a customer’s home, the buyer sent his helicopter to fetch a dealership employee for the walk-through.

Car and Driver
Written By – Ronald Ahrens

Disappearing Donuts

One-Third of New Cars Don’t Come With a Spare Tire

AAA - Tire Inflator Evaluation 3

What’s worse than a flat tire? The sinking realization that you have no way to fix it. That’s the situation more American motorists may find themselves in as 36 percent of 2015 models are sold without a spare tire, according to new research from AAA. That’s a steep rise from 2006 when just five percent of nameplates omitted a spare. As fuel-economy standards rise to 54.5 mpg for 2025, automakers are desperate to reduce weight and the spare tire is arguably the lowest-hanging fruit. Replacing a spare tire with a four-pound inflator kit can cut as much as 30 pounds from a vehicle’s curb weight, and the donut can be removed without the extensive engineering or major investment other weight-saving technologies require.

AAA identified 136 models that don’t include a spare tire as standard equipment, although some of those vehicles do offer one as an option. Every major automaker, from Acura to Volvo, sells at least one car without a fifth wheel and tire. The list is heavy with sports cars, coupes, and hybrids, where space is at a premium, and German luxury cars and crossovers, which often use run-flat tires.

By AAA’s estimate, more than 29 million cars sold in the United States in the last 10 model years don’t have a spare tire. Drivers who aren’t aware their car has no spare are likely to make that realization at the worst possible time: when they’re stranded on the side of the road with a deflated tire. In most cases, car manufacturers substitute an inflator kit for the spare tire. However, inflator kits are extremely limited in what kind of damage they can repair. They’re only effective on clean punctures through the center of the tread, such as picking up a nail, and the object must still be embedded in the tire to act as a plug. Inflators can’t be used on damage from a blowout, curb strike, or pothole. The sealant also renders the tire-pressure monitoring sensor on that wheel inoperable, and replacements can cost up to $200 apiece.

There is one consolation to counter the trend of disappearing donuts. Modern tire technology means flats are fairly uncommon these days. Tire manufacturer Michelin estimates that drivers average more than 70,000 miles between flat tires.

Car and Driver
Written By – Eric Tingwall

VW fined $13 million for emissions fraud in Brazil

SAO PAULO (Reuters) — Brazil’s environmental agency Ibama said on Thursday it would fine Germany’s Volkswagen AG 50 million reais ($13 million) for defrauding local emissions testing requirements.

The company said in October that it plans to recall 17,057 Amarok pickup trucks sold in Brazil to correct software allowing the vehicles to skirt diesel emissions tests, as Volkswagen admitted to doing in the United States.


VW sets Nov. 30 deadline for whistleblowers to come forward

BERLIN (Reuters) — Volkswagen AG set a Nov. 30 deadline for workers to come forward and disclose information about the company’s two emissions scandals in a move to speed up investigations.

Europe’s largest automaker has been making slow progress in finding out who had knowledge of the rigging of diesel emissions tests two months after the violations became public in the United States, and last week also admitted to cheating on carbon dioxide emissions certifications.

Under the whistleblower program, approved by VW’s top management, workers who get in touch with internal investigators no later than Nov. 30 will be exempt from dismissals and damage claims, according to a letter from VW brand chief Herbert Diess to staff seen by Reuters on Thursday.

“We are counting on your cooperation and knowledge as our company’s employees to get to the bottom of the diesel and CO2 issue,” Diess was quoted as saying in the document. “In this process, every single day counts.”

His comments confirmed an earlier report by Sueddeutsche Zeitung jointly with German broadcasters NDR and WDR.

VW has said it hired advisory firm Deloitte and U.S. law firm Jones Day to investigate under what circumstances the company installed software into diesel cars that changed engine settings to reduce emissions whenever the vehicle was put through tests.

A source at VW said the executive and supervisory boards initially sought to have the whistleblower program run through the end of the year but, encouraged by recent positive feedback, decided to set the more ambitious November deadline.

Whistleblower programs were successfully employed years ago by German engineering group Siemens and VW’s truck-making subsidiary, MAN, to help unveil corruption amid ongoing bribery probes.


Physical meets digital

The digital revolution isn’t just about devices – there’s an explosion of innovation for brick-and-mortar operations.

The fragile nature of the UK retail market, coupled with the ever-increasing pace of technology evolution, means that in-store digital innovation is more important than ever for those retailers seeking to gain and maintain competitive advantage.

The customer expectation to be ‘wowed’ has never been higher in the ‘smart’ world we all live in. The challenge for the retailer is in knowing where to focus, given the bewildering array of possibilities that technology brings.

The sweet spot for retailers is how to combine that ‘wow factor’ with useful innovation for the customer that makes their lives easier, driving sales and footfall.

The increasing convergence of bricks and clicks has led to a number of innovations around the ‘click and collect’ space, in some cases involving collaboration between retailers – such as the DPD Pickup Parcel Shop network, which allows consumers to purchase goods from one retailer online and pick them up at another’s physical store.

Or in Cambridge, where Caffè Nero customers can browse and purchase House of Fraser goods on tablets, and then pop upstairs to the House of Fraser branded first floor to collect their purchases and even try them on in fitting rooms. These strategies allow retailers to extend their geographical reach and range in new, more flexible ways.

Delivering strong content, however, remains central. We have seen examples in the world of fashion where catwalk shows have been broadcast live – such as when TopShop dispensed free beauty gifts to customers watching the show at their flagship Oxford Circus store via an in-store vending machine.

Virtual and augmented reality also continue to show value, with innovative apps to help customers in their decision making processes – particularly with respect to health and beauty, where technology offerings from Clinique and L’Oreal show customers how products can look when applied.

Proximity and locational marketing is still a hot topic, and it remains to been seen whether beacons, NFC or image recognition will prevail. Each brings its own challenges and technical limitations.

With so many different possibilities, how does a retailer choose which of these technologies to focus on? As with anything in business life, the key is alignment to business goals and strategy – where does the retailer see itself and what problems is it trying to solve above others? If these are poorly defined then the likely approach to innovation will be scattergun and ineffective.

The real benefit of digital innovation is that budgets hitherto classified as ‘marketing’ can be used to drive revenues through great content and a strong call-to-action, coupled with back-end efficiencies around payments, collections and returns.

Retailers also need to be embed a culture of innovation into their businesses, recognising that there are likely to be many dead ends. Fast tracking innovation by the use of ‘labs’ – a practice employed by the likes of Tesco – can help retailers be agile, but also help them to recognise quickly what is likely not to work without expending vast sums. The ‘lab’ culture can help the larger, more established retailer adopt the mindset of an SME.

The good news is that innovation is easier than ever, thanks to the plethora of technologies and providers. Thanks to the internet, research has never been more straightforward, choice has never been greater and speed to market has never been quicker. Adopting the right problem solving and entrepreneurial mindset, including a healthy approach to failure, is key.

The Chartered Institute of Marketing
Written By – Adrian Hope (Technology Director, St Ives Marketing Activation)

Adrian Hope is the technology director at St Ives Marketing Activation, a field sales and field marketing organisation.