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VP Marketing of Mercedes-Benz USA reveals the effects of customer-centricity

customer experience transformation customer experience transformation
Photo credit:

Kevin Hackert

When Mercedes-Benz initiated a company-wide pivot from product to customer, it experienced better employee relationships, and discovered an entirely new way to operate.

When an organization decides to transform its attitude towards customer experience, it may also ignite far greater changes to its business structure, model and outlook.

Traditionally, Mercedes-Benz USA (MBUSA) has always been a very product orientated company, not well known for delivering an engaging customer experience.

The three-pointed star sold luxury models, situated squarely in the Tier 1 automotive category, marketing itself as the angular-jawed, muscular driving companion for Americans that didn’t need to be wooed, just wowed.

Prior to 2012, it was ranked 22nd on the JD Power list of customer leaders, behind Mazda.

Times have changed, however, and MBUSA has changed with it.

Over the last decade, the voice of the customer has evolved several times over and each organization has had to adapt accordingly.

Drew Slaven, MBUSA’s VP Marketing, explains how the customer experience transformation – initiated by the then President and CEO, Steve Cannon, – needed the support and understanding of its employees, franchisers and franchisees (dealerships) in order to succeed.

“The customer experience transformation began after two necessary phases: firstly, in 2007, [MBUSA] realized we needed to rethink customer experience, and how it should be implemented into the organization. Was it simply a bricks-and-mortar issue, or should we expand it into a cultural context too?

“Five years later, we then experienced a dramatic change. We gained a new CEO who wanted to challenge all our preconceptions of the customer experience, and turn it into a human-led journey for every person linked to MBUSA.”

The new energy and drive that Cannon’s arrival initiated was integral to the on-going success of the customer experience transformation, Slaven believes, as many companies’ transformative efforts tend to fail because they only attempt distinct initiatives without any gelling agent.

“By 2012, suddenly the playing field had changed for every industry. Social media was transforming the ways in which consumers communicate their likes and dislikes with each other, with brands, and with the world – they gained control extremely quickly – and we needed to be progressive and make bold changes to how we worked with them.”

In short, MBUSA couldn’t rely on its luxury product anymore, and so it began its customer experience transformation.

The US branch of Mercedes-Benz had full control – and support – from the global business back in Germany because the level of interest in customer experience varies across geographies, and the US’ mature market lent itself well to a customer-centric pivot.

MBUSA’s program began by articulating to the entire organization why the transformation was necessary.

Each dealership across the country had to understand why they were seeing changes to their incentive structures, to effectively buy-into the vision that Slaven, Cannon, and other executives were painting.

“Every collection of board members can understand customer experience has to be integrated into the value proposition, but only the best can explain why.”

Slaven believes the explanation helped drive impressive adoption rates across the dealership network – especially when Head Office offered to underwrite a lot of their risk during the transfer, from purely sales driven metrics, to more customer facing performance metrics.

It had helped that one particular executive had spent a week in a Mercedes-Benz in Baton Rouge, Louisiana, to open his eyes to the buying process today.

That’s because the buying process on the forecourt has transformed as well.

Previously, luxury products held an advantage over mainstream and affordable models, and customers agreed to wait for the former to be created; technology innovation is leveling the playing field when it comes to automotive evolution, and car makers like Mercedes-Benz need a new differentiator.

“The product gap is closing, so we think we can expand the gap between us and our competitors through customer experience.”

Slaven also notes that there has been a demographic shift in buyers recently: he cites Mark Zuckerberg and his casual dress sense as an indicator that, “…you can’t judge potential buyers when they walk in the door anymore…everyone has to be approached well and looked after.”

Consumer journey mapping across the entire customer life-cycle was the next stage in its customer experience transformation.

Dealerships had to be made aware that, today, some people demand human interaction, whilst others would rather a technology-based experience.

“It used to be simple to plot a customer journey: someone wanted a car, so they would research products, approach around three dealerships before deciding on the best value, and haggling a price…

“…The world today is much more fragmented, and we have to build approaches in both a digital and analogue format, to allow for a flexibility in our infrastructure that our customers expect.”

Next, MBUSA’s transformation process had to identify specific metrics that captured accurately the voice of the customer in meaningful ways, across each valuable touch point.

These four phases outlined above enabled the customer experience transformation to properly gain traction.

By evangelizing the customer-centric attitude to its dealers effectively, and removing the risk associated with this change so they could perform to new metrics, the customer experience transformation could work sustainably.

Recent figures speak for themselves.

For the month of July, MBUSA set a new company record with 28, 523 cars sold – an increase of 3.6% over the same period last year – meaning that Mercedes is leading the way in sales among Tier 1 luxury brands.

Slaven notes that the whole process was set with a four year target, but reveals that the transformative process hasn’t just affected its customer attitude, it’s also re-defined its approach to the company’s future.

“Last week we had our senior marketers globally meet in Atlanta to see how we should be adopting a newer, digital, framework to complement the customer experience transition.

We concluded that we no longer want to be an automotive company, we want to be a technology company that happens to sell cars.”