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Mercedes-Benz USA and Its Retailers to Redefine Client Care

15 September 1999

Mercedes-Benz USA and Its Retailers to Redefine Client Care With 'The Mercedes Experience'

    MONTVALE, N.J., Sept. 14 -- Mercedes-Benz USA, Inc. (MBUSA)
today announced that in conjunction with the introduction of the model year
2000 Mercedes-Benz product line, the company and its 312 retail partners will
introduce a comprehensive retail-level initiative -- called "The Mercedes
Experience" -- that create a new benchmark for client care in the automotive
industry.
    Said Mike Jackson, president and CEO for MBUSA, "This is a fundamental
change in the way the automotive business is conducted at the retail level.
We believe that the key to success going into the next millennium will be to
build enduring relationships -- relationships on the clients' terms.  From the
time that someone considers buying a vehicle to the actual purchase or
repurchase -- and the time in between -- each interaction will be a moment of
truth.  And each is an opportunity to strengthen that relationship and create
clients who are not merely loyal but who are so pleased with the ownership
experience that their enthusiasm brings others to the brand.
    "'The Mercedes Experience' promises our clients not only exciting and
innovative products but also enjoyable and convenient business processes;
professional, caring people; exceptional value and focused, personal
communication."
    Over the past six years, MBUSA has set the stage for sweeping changes in
the retail environment through a host of sales, service and parts initiatives.
In 1993, MBUSA embarked on a value offensive, significantly realigning prices
across its entire model line while eliminating retail and lease subsidies in
order to deliver the best possible value to clients regardless of when or
where the purchase took place.
    "When you make value dependent on how and when a client purchases, you
attract 'opportunists,' people who are more interested in the deal of the
month than in the product.  They're not loyal: if you don't have an equal or
better deal next time they're in the market for a new product, they'll go
somewhere else.  Over the past few years, with a phenomenal product line and
unsurpassed value, we have created "loyalists" to the Mercedes brand.  What we
are setting the stage for now is to utilize best practices and establish
processes at retail which turn these 'loyalists' into 'advocates' for our
brand.  This will enable us to maintain and build upon the extraordinary sales
growth of recent years and to ensure that we continue to demonstrate among the
highest repurchase rates in the industry," said Jackson.
    The Mercedes Experience consists of seven initiatives that go into effect
with the launch of the model year 2000 Mercedes-Benz line:
    -- Product enhancements like four-year 50,000-mile free maintenance
       designed to reduce ownership costs, free alternate transportation to
       limit inconvenience during service, Tele-Aid a unique communications
       and security system that puts you in touch with us from your car
       24 hours a day and automatically calls for help if you're in an
       accident, provide added security/response features for clients in the
       event of accidents or theft and facilitate interaction between
       Mercedes-Benz and its clients.
    -- Optimization of the vehicle allocation and ordering systems to reduce
       delivery times by ensuring that the right products are in the right
       market at the right time.
    -- A special order process that allows clients to custom-order their
       vehicles from the worldwide palette of Mercedes-Benz exteriors,
       interiors and select accessories at an additional charge.
    -- An integrated retail communications program that delivers consistent,
       continuous communications to consumers and market-specific advertising.
    -- Implementation of NetStar, a highly advanced internet-based information
       system that links all existing systems/operations that retailers need
       to successfully provide a high level of client care as well as quicker
       service and faster response time for clients.
    -- Tightened retailer margins to reduce negotiation and create more
       transparency at the retail level
    -- A bonus system which rewards those actions which are in line with
       client satisfaction and creating long-term client relationships

    Additionally, MBUSA will be encouraging its retailers to augment these
processes with retail level initiatives which build the relationship between
individual retailers and their clients.  One such example is a
negotiation-free retail processes (NFP) which eliminates the need for clients
to negotiate in order to get good value in the retail transaction by ensuring
that the same pricing is available to all clients of that retail center.
    Similarly, MBUSA will recommend that retailers consider implementing a
retail staffing structure which is more oriented to client needs and which
encourages employee retention as well as develop a compensation system which
focuses on rewarding both volume and those practices that build client
relationships as well as supporting career path development and growth.
    Said Joe Eberhardt, vice president of marketing for MBUSA, "Like us, our
retail partners recognize that the best way to meet the challenges of a
rapidly changing retail environment -- marked by publicly held retail chains,
E-commerce and the like -- is to proactively take control of our destiny by
delivering a Mercedes-Benz ownership experience that cannot be duplicated or
improved on anywhere else in the industry."
    According to Eberhardt, MBUSA will be supporting the implementation of
"The Mercedes Experience" with national and regional marketing initiatives,
showroom materials and a comprehensive training program.