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Saturday, Jan. 5, 2002
Mazda lets buyers fine-tune Roadster
Fans can access Web site to design own version of popular sports car
If you are a fan of Mazda Motor Corp.'s Roadster, shopping for your next new car might be a little different than what you expect.
In fact, you can now design your own version of the popular sports coupe and order it online.
Point your browser at Mazda's Web Tune Factory site ( www.w-tune.com) , which opened in February, and choose your own engine specifications, transmission type, body color, wheel design and other interior and exterior equipment.
When you complete your selections, your order is forwarded to Mazda's distribution company, which will find the Mazda dealer closest to your home and send your customized automobile order to the dealer.
While Mazda may be at the forefront of the build-to-order business model among Japanese auto manufacturers, it is, in fact, merely following an established trend.
Dell Computer Corp., a pioneer of the model, holds the largest share of the global PC market. What's more, it marched to the top spot by bypassing retailers. Dell only accepts orders by phone, fax or the Internet.
With home Internet access increasing rapidly and businesses tapping the power of information technology on an unprecedented scale, many automakers are beginning to see this direct-to-customer approach as an avenue to improved customer satisfaction.
"The Web customizing of the Roadster has provided our customers the freedom and fun to select the exact equipment they want, and they can do this whenever they want and at their own pace," said Mazda spokesman Katsumi Yoshitake.
On Mazda's Web site, the screen changes with every selection, allowing a customer to see what the car will look like. The price is also constantly updated.
The automaker provides over 4,160 different variables for customizing the Roadster. Conventional shoppers are limited to 37 combinations.
The automaker sold 244 customized models by the end of November. That compares with the 300 Roadsters Mazda sells every month.
Yoshitake explained that with customers making their own selections via the Internet, Mazda dealers spend less time discussing a car's details with customers. By eliminating this process, Mazda can trim about 150,000 yen off the price of a comparable catalog model, Yoshitake said.
Using the Internet also helps dealers reduce excess back orders and inventory, he added.
But at the moment, the automaker sees the largest advantage of online customization in the marketing possibilities it opens up.
"The Web site has over 20,000 monthly visitors sending in their customized versions of the Roadster. Through the real-time information they give us, we can learn so much about their tastes and what they want from a car," said Shigeharu Hiraiwa, Mazda's general manager of the corporate communications division. "We can then refer to this information when working on future products as well as our e-business strategy."
Foreign automakers, including General Motors Corp., have also dabbled in direct online marketing.
"The ultimate goal of GM's e-business efforts is to achieve build-to-order," said GM Vice President Mark Hogan at an automotive conference held in Tokyo in October.
Hogan, also president of the group's e-business unit e-GM, said that in September 2000, GM started providing a similar Web service for its Brazilian customers.
On its Web site, Brazilian customers can customize the Chevrolet Celta, locate a dealer, select a payment option and confirm delivery of their vehicle.
By October, 40,000 of the 70,000 Celtas sold in Brazil were bought over the Internet, Hogan said.
However, despite some advantages with online sales, observers are skeptical of whether the system can easily replace the traditional mass-production, dealer-network model that automakers subscribe to.
Jiro Kokuryo, a professor at Keio University's graduate school of business administration who specializes in e-business movements, said that while Mazda's online gambit was an interesting challenge, applying the method to any type of car may not come so easily, as automobiles present special difficulties with their unique parts and assembly requirements.
Indeed, Mazda's online customizing service is only limited to the Roadster, whose owners tend to be very particular about what they want in their cars.
"Online customized sales can work effectively for commodities such as personal computers that are put together from modules which can also be fit to different models," Kokuryo explained. "But the process could be difficult for cars in general, because auto parts and equipment, (including engines) are often designed for particular models," he said.
Kokuryo also noted that built-to-order works best when coupled with direct sales by eliminating retailers and other intermediaries, but car manufacturers still value dealers.
The online customizing method has yet to gain ground in the auto industry, but automakers are already realizing the importance of customizing their products as a means to attract more customers.
Honda Motor Co., though not online, has brought customization to its motorbikes and scooters.
In 2000, Honda started to sell some models that can be customized. For example, the Shadow Slasher, a 400cc motorcycle that debuted in February 2000, and the FTR, a 250cc model that was introduced in September 2000, allow customers to select colors and accessories, including lights, seats and mirrors.
"We began providing such products to respond to the increasing number of customers who wish to show more uniqueness through their vehicles," said Honda spokeswoman Noriko Okamoto.
Naoko Odaka, a researcher at Dentsu Institute for Human Studies, said that in a society where people are inundated with merchandise, more consumers are willing to pay for a touch of individuality.
"Japanese manufacturers have produced quality goods, but not many have been successful in providing products that stimulate consumers' desire to purchase," she said. "But now, more people are looking for things with which they can show how different they are. Cars are among these items."
Odaka pointed out that consumers are no longer attracted to items that come off Japan's efficient lines of mass-production. Even if a huge capital investment is required to establish supply chains and production lines that can churn out seemingly personalized goods, she said, manufacturers should take the plunge.
"There is no doubt that more and more consumers are looking for something 'made just for me,' " Odaka said. "And customizing a product is increasingly becoming a common practice.
"I think automakers are currently facing a challenge of how to realize that in their own way."