whether they purchased a vehicle, to evaluate
their experience.
“We want to make sure we’re meeting our
members’ expectations,” says John. “It’s only
by talking to our members that we can continue to make the program even better.”
Service,
value,
savings
Behind the wheel of
the Costco Auto Program
By T. Foster Jones
AN AUTOMOBILE IS a complex piece of
machinery. For most of us, that complexity
can be ignored, as the efforts of designers,
builders and technicians have made it possible to simply turn on the ignition and drive.
The Costco Auto Program (CAP) is also
a complex operation. Similarly, the efforts of
those involved in the program have made it
possible for Costco members to show up at a
dealership and make a car purchase as simply
as possible.
I recently had the opportunity to take a
look behind the scenes, or, more appropriately,
under the hood, of CAP, with some of the 125-
plus employees who make up the program.
“First, we need to identify who would be
best suited for dealing with Costco members,”
says Rick Borg, vice president of program operations for the Costco Auto Program. “It has
to be someone with over-the-top service skills.”
At the dealerships, these contacts are
trained and certified by Costco’s field reps, to
follow established CAP processes. “Contacts
commit to providing a first-class member
experience and ensure a no-pressure, no-obli-gation buying process,” says John.
“We sit down and intensively train these
contacts face to face,” says Rick. “And the field
reps are constantly working with them. We
don’t just sign them up and forget about them.”
Shock absorbers
No ride is without bumps. For those
unexpected potholes or roadblocks, Costco
has established a Member Advocacy Group
(MAG) to smooth things out.
“The Member Advocacy Group is unique
in the auto-buying industry,” says John. “This
group is available to assist members before,
during and after they purchase or lease. If any
questions or concerns should arise, this
group ensures that the members’ concerns
are resolved.”
“The MAG really sets Costco’s program
apart,” says Rick. “There is no other program
in the industry that has anything like this.”
COMSTOCK
These highly trained member-service professionals work with Costco members to help
them select their car, perform price verifications (to make sure the member got the Costco
deal) and resolve any issues with the dealer or
the vehicle after the transaction is complete.
And, says John, “We have also established
other mechanisms to ensure the program is
running correctly.”
These include both “competitive shop-
ping,” in which Costco reps research the com-
petition and compare vehicle pricing within
specific markets, and “shadow shopping.”
“The shadow shopper conducts mystery
shops of our dealerships to make sure the
dealer is in compliance with our program,
confirm correct pricing and evaluate the cus-
tomer service provided by our Authorized
Dealer Contacts,” says John.
80 ;e Costco Connection APRIL 2011
Nuts and bolts
The basics of CAP, which began 20 years
ago, involve establishing relationships with
top-rated dealers of most vehicle makes and
models, in order to provide Costco members
with low, prearranged pricing within a convenient distance of every Costco warehouse in
the United States.
“The selection of individual dealers is
based on very specific criteria to ensure the
dealerships are in line with our program standards,” says John Gleason, Costco’s manager of
the program.
Participating dealerships must agree to
meet strict pricing requirements, consistently
rank high in customer satisfaction scores and
be able to ensure that select dealership representatives (certified and trained Authorized
Dealer Contacts) follow specific processes to
assist Costco members.
Smooth handling
Whether a member has contacted CAP
through the call center or via Costcoauto.com,
member service steers the way.
“We provide auto-buying specialists who
handle call center inquiries and who can
explain the program in step-by-step detail,” says
John. “They can also help the member locate
the participating dealer closest to the member.”
In addition, the Costco Auto Program
contacts all members who requested a referral
to a dealer through the program, regardless of
Horsepower
Driving all this forward is the 125-per-
son piston engine that makes up the Costco
Auto Program.
“The Costco Auto Program has helped
more than 1 million Costco members purchase a car within the past five years,” says
Rick. “It is the most successful program in the
industry, because it’s a win for everybody. It’s
a win for dealers, because they are selling
more cars. And it’s a win for Costco members,
because they are getting low, prearranged
Costco member pricing—the best in class and
the best in market for every model.”
Connecting
For more information about the Costco
Auto Program, visit Costco.com and search
CAP12, or call toll-free 1-800-458-1692.
Costco does not sell vehicles or negotiate individual
transactions. Members must go to a participating dealer.
Bumper to bumper
“With the Costco Auto Program, our goal
is to provide exceptional value and service,
from start to finish,” says John. “We have an
established buying process, coupled with
value pricing, trained staff and 20 years’ experience to ensure that goal is met. We really
work hard to make this as simple as possible
for our members.” C
