MERCEDES-BENZ USA AND ITS RETAILERS TO REDEFINE CLIENT CARE WITH "THE MERCEDES EXPERIENCE"

Mercedes-Benz USA, Inc. (MBUSA) 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 client  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.