“Lexus really has changed the way dealers treat their customers,” says California's top Lexus salesperson, Tim Mitchell of Vista Lexus in Woodland Hills, a Los Angeles suburb.
He ticks off the innovations the Toyota luxury brand brought to the industry since its 1989 debut.
“Lexus raised the bar,” says Mitchell, 42, a graduate of the University of Hawaii who joined Vista Lexus (one of the franchise's first dealerships) on its opening day. “It was a gamble, costing our owner, Steve Shuken, a cool $1.5 million, but it paid off.”
Lexus took the dealership experience to a higher level by selling luxury cars in posh, dedicated showrooms where customers were treated like royalty. It was a novel idea back then.
“No other volume brand delivered new cars to the door wherever customers were located, or left, not just any service loaner, but the best we could provide,” says Mitchell. “Our dealerships were small museums of ritzy cars sold in plush surroundings, and every visit for service or a look at next year's models ended with a free wash and gas fill-up.
“Our focus on customer satisfaction was purposely designed to create Lexus customers for life. I have plenty of repeat customers out of the 100 or so Lexus vehicles I sell every month. One is Pat Lyons, a 70ish lady from San Diego who buys a new car every two years automatically.”
It was atypical for Shuken to land the Lexus franchise in the first place, considering his other dealership holdings.
“We are unusual as a Lexus store because Mr. Shuken is also a Ford and Lincoln-Mercury dealer next door — and not too many Ford dealers have landed the Lexus franchise,” says Mitchell. “But Vista Ford always was customer-minded, and that's why Lexus chose us here over a lot of Toyota and GM dealers who applied for this location.”
Vista is a family enterprise. Shuken's daughter, Tori Shuken, manages the Lexus store. Son John runs Vista Ford and Vista Lincoln Mercury. Tori is one of a few female Lexus dealers. She notes that a lot of Lexus owners are women, attracted by the brand's service-satisfaction record.
“Women do identify with Lexus here in southern California,” Mitchell agrees. “The flagships (LS 430 sedan and SC 430 coupe) are getting a more macho look in a year or two, much to the delight of the dealers. The factory does listen to us, and I don't think our women customers will be turned off by the more aggressive design we have recommended.”
Lexus has steered clear of external incentives, to the dismay of most competitors in the luxury field. There are internal incentives, however, such as cash-value certificates for repeat customers and monthly targets for every model, with rewards to sales people topping the targets.
As a store that's open seven days a week, more sales people are required at Vista Lexus and other dealerships with similar hours in the sprawling Los Angeles market.
“We have 10 sales people handling new and certified pre-owned,” says Mitchell. “They are familiar with certified, which has become a second or third family vehicle, and is strongly identified with Lexus since we were first with a certified program back in the early 1990s.”
Certified pre-owned Lexus shoppers are given the same customer-friendly treatment that is afforded to new-car buyers, says Mitchell.
Vista Lexus leases about three of four new vehicles it delivers, typical for luxury brands in the LA market.
Mitchell says the luxury-segment leadership Lexus has enjoyed for six years could lead to complacency at the dealership, except for one thing:
“With Steve, Tori and John, from the leadership on down, there is a 30-year-long tradition of family ownership here that has carried through.
“This has meant low employee turnover, high customer satisfaction with the product, sales process and service — and, above all, maximum returns for the dealership. Lexus sure has pointed the way for all dealers.”