Satisfiers and Loyalty for Rental Cars

JD Power just published the 2008 Rental Car Satisfaction Study. The study was based on more than 13,400 evaluations from business and leisure travelers who rented a vehicle at an airport location between September 2007 and October 2008.

The study showed the top three rental car companies were Enterprise, Hertz and Alamo in that order. The scoring was based on 6 general factors:
1. costs and fees
2. pick-up process
3. rental car
4. return process
5. reservation process
6. shuttle van/bus.

Note that these are general variables and should/must have some additional detail measures behind them to make them actionable. The report indicates there are some additional factors that have a particularly strong impact on satisfaction; namely,
1. adequate prep of the vehicle
2. ensure customers receive the vehicle model they reserve
3. minimizing wait times for vehicle pick up and drop off.

Recall that in previous my previous blogs I have identified the three components of loyalty as product, process and people. Other than the cost/fees component the other five factors contain a combination of process and people. In order to translate the factors into actionable items each of those five factors must be broken into its component parts that relate to the service process and the people in the service process. For example, the satisfaction of having a short wait time for pick up can be dramatically reduce by a driver who has dirty clothes and a bad attitude. Of course the other side of the coin is that satisfaction resulting from a long wait can be dramatically improved with a very courteous driver with a can-do attitude. The point is that all three components of loyalty must be included in order to maximize the impact on customer loyalty.

Another point to be made from examining these factors is that there is no discussion of which factors are satisfies and which are dissatisfiers. The difference is critical. Recall that satisfiers have room to move with little impact on overall satisfaction whereas dissatisfiers can cause customers to leave immediately with a simultaneous major negative impact on overall satisfaction.

Some further statistics from the study suggests the impact of an imbalance of the three loyalty components. When the data is parsed into groups the following statistics are observed:
1. When customers say they experience a problem, overall satisfaction declines more than 10% compared to customers that had no problems.
2. If the problem is not resolved, overall satisfaction drops approximately an additional 5%.

The final set of statistics relate to the typical loyalty questions; (i) likely to use the car company again, and (ii) likely to recommend. Below are the statistics that relate these two measures to the measure of overall satisfaction:
1. For customers who are highly committed, 86 percent said they will definitely use the care company again and 88 percent said they would definitely recommend the company to others.
2. For customers with only a medium commitment, 21 percent said they would definitely use the car company again and 20 percent would definitely recommend the car company to others.

The bottom line is that there is an obvious impact of satisfaction on loyalty when you examine this data. One interesting point is that customers with a high level of commitment are about 4 times more likely to return and recommend. The economic impact of this statistic would warrant careful consideration by all rental car companies to focus on satisfaction. There is one additional point to be made from the data. Namely, there apparently are about 20% of the customers with only a medium commitment who act like apostles. Maybe some of these customers with only medium commitment are part-time apostles.