INSIDE COVER - Kia University

1 INSIDE coverWe re pleased to introduce you to the Kia customer 360 Service Experience. This exciting initiative is about a new way of doing business for everyone at Kia. So, what does this mean for you? This is about a fundamental shift in our fixed operations focus; a shift that puts our customers first. A shift that will: Improve the Kia customer experience Increase our customer retention Create more opportunity for all of us Provide more money to our bottom lineYou will notice a new logo for this initiative to symbolize to our customers our long-term approach and commitment to them: Service centered around you is the essence of the Kia customer 360 Service Experience. It s meant to remind us of why we are here and what the key ingredient is to Kia s success our customers. The goal of this initiative is simple: we must do everything with the customer in mind throughout the ownership cycle.

2 From new car to new car and everything isn t a 30-day program. It s a long-term initiative. It s a mindset shift. So, why now? We all recognize the challenges we are faced with today. Fortunately, our product is strong. In fact, our quality has significantly improved as we are driving toward zero defects. We are poised for tremendous growth as we shift to less warranty work and more customer -pay work. But, we have work to do. There is a large gap between our actual quality and our perceived quality. We also must improve our CSI, service retention, and customer -pay sales. The time is right. We have a time is right. We must do something now. You ve been asking KMA to help improve your fixed operations profitability. We have a plan. The Kia customer 360 Service Experience is designed to provide you with the tools, processes, and training support to help you retain your current customers and regain your lost customers.

3 We ll do this by exceeding customer expectations at every service visit. The foundation is simple: Value and competitive pricing Fair treatment Convenience and respect for every customer s timeKia is committed to making this our foundation for moving forward. It s not a program of the day, but rather the way we approach our business and our customers into our future initiative focuses on the things customers really care about, and it supports your efforts for making it happen. We have developed a comprehensive, long-term program that includes communication elements, Web-based training, in-dealership workshops, best practice sharing, ServiceSmarts Online market information, and more. Now is the time to establish your Game Plan, and you can start by exploring the following pages to learn why the Kia customer 360 Service Experience can help you, the service elements it focuses on, and first steps for starting to implement it in your service department.

4 You may already have some or all of these elements in place; no matter where you are, this program will help you re giving you a dealership self-assessment called the customer -Pay Service Scorecard. Please take the time to complete the scorecard and get ready to implement your new Game Plan. Good luck as you consider this exciting approach to your business and how you handle our customers. Remember, it all centers around ,John CroweVice President, ServiceTHE KIA customer 360 SERVICE EXPERIENCE?WHY WHY THE KIA customer 360 SERVICE EXPERIENCE?The purpose of the Kia customer 360 Service Experience is simple. It s a fact Kia owners have choices when it comes to servicing their vehicles. As a result, in order to obtain this business we must do everything we can to convince these customers to choose, and continue to choose, Kia dealerships for their vehicle service.

5 We have to retain current customers and regain lost customers by providing an experience that revolves around our customers and exceeds their expectations for vehicle service. The Kia customer 360 Service Experience is based on the following key drivers: Value and competitive pricing Fair treatment Convenience and respect for every customer s timeFocusing on these drivers will provide you with the following business results:IMPROVED customer SATISFACTIONIMPROVED DEALERSHIP FIXED OPERATIONS PROFITABILITYINCREASED DEALERSHIP customer -PAY PARTS AND LABOR SALESINCREASED SERVICE RETENTION1 Fixed ops are the key to survival these days .. and a dealer s ability to sell preventative maintenance is the key. AutoExec Magazine, August 2008 2 WHY IS THIS IMPORTANT?Today s service and parts opportunities are significant, but we re not retaining the percentage of service customers that we should because we re missing opportunities to keep our customers away from the WE RE DOINGPoor processes and customer handling are leading to low CSI scores.

6 And customers who go to the competition for INdEX RANKINgSource: Power and Associates, 2008 customer Service Index Study 4dEAlERS SHARE OF SERVICE VISITS bY YEAR OF OWNERSHIPKia has a below-average share of service visits in the first three years of ownership, and customers are being lost to the aftermarket. Source: Power and Associates, 2008 customer Service Index Study Note: Based on five years of IMPACT Lost Service Revenue = $152,916,553 Average Lost Service Revenue per Dealer = $235,256 Lost Service Gross Profit = $107,041,587 Lost Service Gross Profit per Dealer = $164,6805 AVERAgE HOURS OF REgUlAR SERVICE SOld PER MONTH PER dEAlERSHIPKia dealers are near the bottom of the industry for generating customer -pay service Service Monitor Policy by Industrial MR CUSTOMERS gO TO KIA FOR SERVICEP erceived higher cost and lack of convenience are top reasons customers leave Kia dealerships for the : Power and Associates, 2005 Service Usage and Retention Study7 RETENTION bENCHMARK dATAKia service retention scores are well below the non-premium average.

7 The Kia customer 360 Service Experience is all about what you can do to retain more of your customers who are going elsewhere for company data IMR Inc. 2000 20058A CHAllENgE TO YOU TO MANAgE THESE THREATS: Shift away from a warranty-repair business model; change your fixed operations thinking from a warranty-repair to a retail profit-center perspective Be actively involved in growing your business Embrace what customers expectKia customers who stay with us for service through their vehicle ownershipKia customers we lose to a service competitor at some point during vehicle ownership INgREdIENTS FOR KEEPINg YOUR CUSTOMERSWe can t say it enough. There are three key ingredients for retaining and regaining your customers. Here are tips from dealers who are doing it the right ingredients for retaining and regaining customersdealer tips1.

8 Provide value and competitive the competition. One of the keys is to know what my competitors are charging and then being able to explain to my customer why our service department s pricing is the way it is. It s about the value we provide beyond just the price. And, that s worth something! Have well-trained Kia technicians. All of our technicians are exclusive Kia technicians .. we are high on training and send our techs to training classes. Under promise and over deliver. Our service team is trained to under promise and over deliver .. Give the customer an estimated time that is 50% greater than the time needed to do the work. Try to have the vehicle dropped off for the whole day. Notify the customer of any delays. 2. Treat customers your customers the truth. Sometimes a repair isn t needed and there s nothing wrong with telling the customer that.

9 They appreciate it, and for us it builds long-term creditability and happy customers who keep coming back to us. Make customer satisfaction a priority. Our goal is to be #1 in customer satisfaction in the District, the Region, and the Our pay plans are designed to reward employees if we attain this goal. People make a difference. Our Service Writers are among the best I have ever worked with. They are personable and have a sincere desire to see that all of our customers are satisfied. We recognize the importance of Kia to our success and our Kia customers are treated accordingly. Go the extra mile..we know our customers better. We offer loaner cars when needed and always call and let them know when their car is done. 11 Key ingredients for retaining and regaining customersdealer tips2. Treat customers fairly. (cont.) COVER all the bases.

10 Have detailed written explanations on the repair order .. each and every customer is called with an explanation of all repairs. If the customer is not available, a message is left or a note is written. Respect the customer s right to be informed. Explain repair and maintenance needs in non-technical terms. And describe repair or maintenance alternatives in an objective, straightforward manner. Always ask the customer if he or she has any questions. 3. Make the service experience convenient for customers and respect their each customer as an individual. Everyone is busy in today s world that means we need to put our customers first and think about their crazy schedules. We always ask customers how they want us to communicate with them and we treat each of them individually. Take the vehicle to the customer . Have service porters bring customers vehicles to them at the service entrance or part the vehicles in designated service pickup spots by the service entrance.