Customer satisfaction

What is the relationship between the American Customer Satisfaction Index (ACSI) and the mode of purchase?

Does the number of new car models affect the ASCI at General Motors?

How does the rate of recalls of new models affect customer satisfaction?

How does the education of customers impact customer satisfaction at General Motors?

Hypothesis

There is a positive correlation between the rate of vehicle recalls and customer satisfaction.

How does the rate of recalls of new models affect customer satisfaction?

General Motors has made recalls that have amounted to $ 1.7 billion in losses. Vehicle recalls are made in the hope of making sure that customers are satisfied. It is important for GM to determine whether the company has been improving its level of customer satisfaction with the recalls. The recalls may as well be serving as a show of laxity in the service of the company. The company therefore must play its role well in determining the right steps to obtain customer loyalty and satisfaction.

According to (Rao & Chandra, n.d.), there is a correlation between customer satisfaction and customer loyalty.  It is also shown that customer satisfaction has a direct correlation with share prices. After the recalls, the company company’s shares had a 13 % drop in price. This implies that there could as well be a correlation between vehicle model recalls and the fall in share prices.

The correlation between customer satisfaction and a drop in shares which was a result in the vehicle recalls cannot, however, be relied upon to show a relationship between vehicle recalls and customer satisfaction. There is, therefore, a gap for research in this case. The drop in shares has also come together with a chance for the owners of the recalled vehicles to try other vehicle models. According to dealers, it is believed that customers who get a chance to try another vehicle also have a chance to buy another vehicle (Isidore, 2014). This implies that customers who have recalls and get a car to replacement while awaiting the repair of their cars also stand to feel more satisfied and therefore the higher chance of buying another car.

There is an obvious conflict in the possibilities here. There is a possibility for either of the two possibilities to be true. The only way to determine the relationship is through the use of research. The best way that this can be done is by the use of surveys (Garbarino, & Johnson, 1999). Apparently, however, the customer satisfaction surveys by General Motors have been suspended. The reason for the suspension is the fact that they have been found to be too long for them to be reasonable. They have also had a lower probability of completion as customers find the process too tedious. In order to determine whether customers have a higher customer satisfaction level, employees need to determine if the current customer satisfaction level. Customer satisfaction level can be determined by the use of surveys throughout the market share of the company. The two distributions obtained from the past and the present when there are many recalls will give an idea of how the customer satisfaction is affected by the recalls of vehicle models.

In conclusion, there is a gap for research to determine what impact the recalls of vehicles have had on customer satisfaction. On the other hand, it may be necessary to study the population of those customers whose vehicles have been recalled. It may be necessary to perform a survey to determine if they are the individuals causing the correlation.

References

Garbarino, E., & Johnson, M. S. (1999). The different roles of satisfaction, trust, and commitment in customer relationships. the Journal of Marketing, 70-87.

Isidore, C. (2014). GM recall’s $1.7 billion windfall for dealers and parts makers. CNNMoney. Retrieved 2 October 2014, from http://money.cnn.com/2014/05/22/news/companies/gm-recall-windfall/index.html

Rao, A., & Chandra, S. The little book of big customer satisfaction measurement (1st ed.).