Historically, Mercedes-Benz was sold in the UK through a franchised network of some 138 dealerships. Each of these was autonomous, with the exception of three dealerships owned by the distributor Daimler Chrysler UK (DCUK). DaimlerChrysler had relatively little control over relationships between dealers and customers. Dealers managed their own relationships including customer research, data base management, acquisition and retention processes. This presentation describes the challenges faced by the company initially and how did they overcome those challenges.

1. Mercedes
Compiled By:
Jas Singh Bhasin

2. CRM - Introduction
Customer relationship management (CRM) is a model for
managing a company’s interactions with current and future
customers. It involves using technology to organize, automate,
and synchronize sales, marketing, customer service and
technical support.

3. CRM – Introduction (contd.)
Builds a database that describes the customers and the
relationship they hold with the company
Provides enough detail so that the company can offer the client
the product/service that matches their need the best.
May contain information about their past purchases, who is
involved with the account and a summary of all conversations.

4. Mercedes – The Company
Mercedes-Benz is one of the world’s most successful
premium brands. Its technical perfection, innovative
design features and numerous car legends have made the
Mercedes star one the world’s best known trademarks
today
Other premium brands such as BMW, Lexus and Jaguar
were competing fiercely in the luxury car market where
Mercedes was traditionally very strong.

5. Mercedes – The Company
 Historically, Mercedes-Benz was sold in the UK through a
franchised network of some 138 dealerships.
 Each of these was autonomous, with the exception of three
dealerships owned by the distributor Daimler Chrysler UK
(DCUK).
 DaimlerChrysler had relatively little control over relationships
between dealers and customers. Dealers managed their own
relationships including customer research, data base
management, acquisition and retention processes.

6. Mercedes – The Challenge
 Autonomous Dealers: Mercedes-Benz was sold in the UK through
a franchised network of some 138 dealerships. Each of these was
autonomous, with the exception of three dealerships owned by the
distributor DaimlerChrysler UK (DCUK). DaimlerChrysler had
relatively little control over relationships between dealers and
customers. All dealers managed their own relationships including
customer research, data base management, acquisition and retention
processes.
Low Quality of Service: Although the technical quality of the
product was highly regarded, customers complained that the service
that they received was not of the same high standard. This translated
into declining customer satisfaction and increased defection.

7. Mercedes – The Challenge
 Communication-Delivery Inconsistency: Customers reported that
there was an inconsistency between the communication that they
received and the service that was delivered.
 Inadequate Enquiry System: Enquiries from the customer went
directly to the dealerships and were handled through their internal
processes. These were sometimes inadequate.
 Uncoordinated communication received from dealerships:
Mercedes-Benz customers received communication from different
dealerships that was not always coordinated. Such communication
may not match customer needs at a particular point in time in their
purchase cycle and may result in conflicting or duplicated messages.

8. Mercedes – The Challenge
 Isolated Database: Each dealership operated its own database. The
information in this database could be out of date, inaccurate and
missing important information.
 Salesperson’s Attitude: Salespeople did not always appreciate that
it was essential to record correct and complete customer information
if effective contact was going to be sustained.

9. Mercedes – The Challenge
Keeping the track of the Customer maximizes Lifetime Value:
“When consumers change addresses or change names due to marriage
or divorce, etc., their auto company is probably the last place they’ll
think to inform of the change. it’s very hard to keep track of customers
through these life changes. And that’s a big problem for an auto
company, especially a luxury auto company like Mercedes-Benz. If
we’re going to maximize the lifetime value of that relationship, it’s
crucial to be able to keep track of our customers through these life
changes. If we can’t find them, we can’t tell them about our new
models and lines. And then, when it comes time for them to replace
that old Mercedes, we might not be able keep them within the
Mercedes family”, says Mark Juron, Mercedes’ general manager.

10. Mercedes – The Challenge
Inconsistent Customer Record:
“And Mercedes-Benz buyers are even harder to track than the average
person. Because of their high incomes, lifestyles and career paths, they
tend to be promoted and transferred more often and have the means to
buy new houses frequently. They’re frequently on the move. Many
times, Mercedes would end up with two or three different versions othe
same person on their mailing file”, Juron says.
This lead to the requirement of an “de-dupe” file system.

11. Mercedes – The Solution
 Adopting New Distribution Model : In 2000, DCUK decided to
adopt a new distribution model for Mercedes-Benz passenger cars.
They re-organized the market into thirty five new, larger
geographical areas and invited a number of existing dealerships to
enter into new retailer agreements. This entailed these dealerships
taking over responsibility for the retail sales and service of
Mercedes in specific geographic territories or ‘market areas’ (MAs).
 Project Management Team was Established : Within DCUK, a
project management team was established, drawn from managers in
marketing and operations. The project management team set about
identifying the key CRM processes and determining how each
process would be implemented throughout the new retail structure.

12. Mercedes – The Solution
 Every aspect of the customer relationship needed to be carefully
examined, to ensure value was created at every opportunity: for the
customer, the 392 Handbook of CRM: Achieving Excellence in
Customer Management MAs and DCUK.
 Benchmark Mercedes-Benz : The first step was to benchmark
Mercedes-Benz against other leading marques as well as best in
class organizations. This research suggested that there were several
areas where greater value could be delivered to the customer during
both the sales process as well as during the ownership experience.
 New Retail Agreements started working : Under the new retail
agreements entered into by the MAs, DCUK gained closer control
of the valuable Mercedes-Benz brand.

13. Mercedes – The Solution
 Anew approach to the marketing structure within each MA was set
out, which involved a centralized CRM and marketing team – one for
each MA. Each team was given the responsibility of database
management, customer support and regional marketing.
 DCUK, working closely with one MA on a pilot programme, mapped
out each of the critical customer processes.
* These included prospect management (enquiry through to sale);
* customer contact (communications throughout the period of customer
ownership);
* complaint management (acknowledging that complaints are an
opportunity for improvement and also for forging deeper understanding
with customers).

14. Mercedes – The Solution
 Better Relationship between customer and salesperson : Instead
of a salesman owning a customer, each relationship was carefully
managed centrally through the new CRM marketing team set up
within each MA.
 Each communication channel
was carefully integrated so
that the customer
received relevant messages by
an appropriate channel at
various critical points during
the ownership cycle.

15. Mercedes – The Solution

16. Mercedes – The Result
 To win the hearts and minds of leaders and employees, it was
critical that there would be some quick wins from CRM. These
results could be broadcast through the dealer network to
encourage others. One MA was chosen to test out processes and
to confirm the benefits. Quickly the financial benefits to the MA
were established as well as steady improvements in key measures
of customer satisfaction and customer loyalty.
 Cross selling and up selling opportunities were used to advantage
and the MA reported that relationships with customers were
extended and deepened.

17. Mercedes – The Result
 The MA could justify the significant expenditure on CRM
systems and processes by the impressive financial returns as well
as improvements in critical customer measures.
 Communicating these results to other MAs reinforced the
business case for adopting CRM. Every opportunity was used by
DCUK to share the experiences of dealers in implementing CRM.
 Winning the CRM margin has become highly important for
dealers and is ensuring that the CRM initiative stays at the
forefront of people’s minds. Staff are aware how their individual
efforts contribute towards the success of CRM.

18. Mercedes – The Result
 The initial results of the CRM implementation have
been very encouraging. There is a great enthusiasm
within both the MAs and DCUK for improving the
customer experience and establishing closer
relationships with customers.
 “It is our belief that the Mercedes-Benz experience has
to predominate everything we do—everything that
touches the customer,” says Juron.

19. Mercedes – The Result - LIVE
“ Mercedes Benz Canadian Autoshow Tour Uses RFID
CRM & Social Program”
(RFID World Canada) Bash Interactive, announced their launch of
a RFID-tap-to-like Facebook & joint E-Brochure CRM program for
the Mercedes Benz Canadian Autoshow Tour. The Mercedes Benz
RFID, E-Brochure and Tap to Like program officially launched in
Montreal, Quebec on January 2012, and will be also used in the
Toronto Autoshow starting February 17th, and the Vancouver
Autoshow starting April 3rd.

20. Mercedes – The Result - LIVE
The leading-edge RFID CRM
& Social Program enables
attendees of the Mercedes
Benz Canadian Autoshow to
interact with the exhibit by
“Tapping to Like’ Vehicles,
Tapping to Take & Upload
Pictures, and receiving a
Customized Electronic
Brochure with the models of
vehicles they selected.