Question
Subaru of America (www.subaru.com) is the automobile division of Fuji Heavy Industries (FHI). Subaru has been operating in the United States since 1968, when it
Subaru of America (www.subaru.com) is the automobile division of Fuji Heavy Industries (FHI).
Subaru has been operating in the United States since 1968, when it began selling the 360 Minicar.
Headquartered in Cherry Hill, New Jersey, the company serves nearly 600 dealers nationwide.
Subaru has offered many different cars over the years, but as of 2009 it sold five different brands
in the United States. These brands each have a variety of different models. The five brands are the
Tribeca, the Outback, the Forester, the Legacy, and the Impreza. One of the unique things about
Subaru is that 100 percent of its models come with all-wheel drive.
Subaru's strategy is apparent in one of its key players, Joe Barstys. Joe has been with Subaru for
more than 20 years, and he spends his time worrying about customer satisfaction. Joe and people
like him are the backbone of Subaru. These people help Subaru focus on its customers and their
wants and needs by conducting marketing research. Joe has incorporated the use of customer
surveys into his practice, and for this he has gained the title of "Mr. Survey." Joe's goal is to
develop a customer satisfaction level that will help build a certain level of loyalty in Subaru's
customers. This loyalty is extremely important in the car business, because it has historically been
much lower than in other industries. Marketing research has shown that although approximately
90 percent of customers are pleased with their automobile purchase, only 40 percent are loyal
enough to buy the same brand again.
Surveys are a very valuable tool to Subaru in its quest for customer loyalty. The company mails a
survey to each customer within 30 to 45 days of purchase to assess the customer's feelings toward
the newly purchased vehicle, to obtain information on the nature of the interaction with the dealer,
and to learn about other elements of the purchase process. Subsequent to the initial contact, more
surveys follow throughout the "lifetime" of the customer (i.e., the duration of ownership of the
car, on average 6 to 7 years). The latter surveys assess the long-term satisfaction with the vehicle
and the dealership. The mail surveys have a high 50 percent response rate. As of 2009, about
500,000 surveys are mailed each year. Additional surveys are conducted over the Internet.
Questions on the survey include: How was your service experience? How does Subaru compare
to other service providers you have visited? What about the buying experience? How satisfied
were you? What were the salespeople like? These questions help Subaru determine how customers
regard their Subaru experience and what steps Subaru should take to improve this experience
further.
These surveys provide important feedback, allowing Subaru to adjust its approach based on
consumer demands. An example of the importance of adjustments can be found in the case of the
female consumer. Through surveys, Subaru found out that it needed to adjust its marketing to
include female consumers, who are becoming an increasingly large part of the market. It was
important for Subaru to understand what types of things would appeal to women in order to offer
a more desirable product to them.
Another benefit of marketing and survey research is that Subaru has been able to identify the types
of people who are more likely to buy its automobiles. Subaru believes that the typical Subaru
owner is different from the average consumer. Its average consumer is highly intelligent, highly
independent, and outside the mainstream crowd. Thus, Subaru tries to market automobiles to these
types of people and attempts to distinguish itself from the larger, more mainstream competitors.
Results of affinity for the company are evident as customers feel motivated to send pictures of
their cars to Subaru.
Joe considers his background in philosophy and theology (he has a BA in philosophy and an MA
in theology) to have contributed to the role of Mr. Survey he plays at Subaru. Joe explains that his
theology and philosophy background allows him to look at the human experience with a product.
A customer's problem could be a dysfunction with his car, his dealer, or his own ignorance about
how the car works. All of these are essentially about human experience, and hence no matter
whether Joe works in the automobile industry or any other, he is, in effect, dealing with human
experience. This human experience is just one aspect that he loves about his job, because he loves
being with people and finding out what makes them tick. The other aspect that he is really excited
about is the great responsibility and decision-making authority that he shoulders with the goal of
maintaining customer loyalty, and every year he achieves success.
The company's goal is continued growth through 2015, and it hopes that with the help of marketing
research it will be able to achieve this goal. It believes that listening to the customers and adapting
its practices to meet their concerns will provide customers with a higher level of satisfaction and
ultimately lead to a higher level of loyalty. Subaru's marketing research staff, like "Mr. Survey,"
will be critical to this endeavor.
Conclusion
The case presents an interesting overview of Joe Barstys's role at Subaru and the importance and
utility of surveys in building customer loyalty. Surveys have helped Subaru get continuous
feedback on key parameters that shape customer experience resulting in high brand loyalty. In
sum, marketing research has helped Subaru understand its customers better and hence address their
needs and expectations better.
In order to continue to grow, Subaru must foster and build customer loyalty what can I define as the
management decision problem.
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