Car Tracker Puts Brakes on Releasing Its Data

By REBECCA FLASS

Staff Reporter

Bowing to pressure from the auto industry, a firm closely affiliated with the consumer tracking firm J.D. Power and Associates has agreed to stop offering its vehicle surveys to the public.

Power Information Network, spun off from Westlake Village-based J.D. Power, has for years tracked everything from the actual transaction price of a Ford Explorer to the average age of a Honda Element buyer and how many days BMW’s MINI sits on a lot. It sold its research to automakers and other subscribers and was generous in sharing the reports with the media.

But as of Sept. 1, PIN stopped giving or selling data specific to manufacturers, brands or models to the media. This comes on top of pre-existing stipulations about how its data can be used by subscribers. It continues to offer more general data on the overall industry and specific segments, such as sport utility vehicles.

“We do think it could potentially be harmful to our relationships with clients,” said Tom Libby, senior director of industry analysis in the company’s office in Troy, Mich.

Libby confirmed there were concerns about releasing data that could result in negative stories about clients. “Our business is to assist them and help them,” he said. “Sometimes it seemed we were working against them by releasing data and they questioned our motives.”

In addition, Libby said providing data to the press for free was hurting PIN’s efforts to sell the data.

Officials at several automakers, including Nissan North America Inc., based in Gardena and Toyota Motor Sales USA in Torrance, said they were unfamiliar with the decision.

J.D. Power will continue to provide all the data it has in the past, including its Initial Quality Study, which measures reports of quality problems with new vehicles, and its Customer Service Index, which rates the level of satisfaction new-vehicle owners have with the dealer service department.

Todd Turner, president of consulting firm Car Concepts in Thousand Oaks, doubted that automakers would cancel subscriptions because of articles based on data they didn’t like. “The only real power, as a client of PIN, is that you can threaten to no longer subscribe,” he said. “It would seem to be an empty threat, if they need that data to operate their business in an efficient manner, because they would basically be making that decision to spite themselves.”

Business decisions

PIN uses an electronic tracking system that gathers daily point-of-sale transaction data from 6,200 dealers nationwide. After analyzing more than 250 details about transactions, PIN uses the data to compile various reports and then sells them to clients.

While many businesses that generate proprietary reports offer portions to the media at no charge, others choose not to release them at all. Still, few would say that pressure from the industry they track has forced them to change course.

Paul Dergarabedian, president of the box office tracker Exhibitor Relations Co. Inc. in Encino, said he has never run into problems with clients as a result of sharing the data he collects.

“We found that for us, it’s great to get our name in the press; therefore, we often will supply data free of charge,” said Dergarabedian. “In return for that, we get a lot of exposure for our company name and our brand that is, to us, as valuable as cash.”

While automotive research and consulting firms walk a fine line between serving car companies and providing valuable data to consumers, it is considered unusual for them to bow to pressure from car makers.

Wes Brown, a partner with automotive research firm Iceology, said he has never had automakers complain about data he has released, although years ago, when he was at a previous company, Nissan took issue with something he had said.

“I was right so it didn’t bother me,” he said. “If you’re going to be quoted, you don’t want to look like an idiot and you’re not going to paint a fantastic picture when there isn’t one.”

Halo effect?

The policy shift follows an aggressive pursuit of media coverage. When the Wall Street Journal used the company’s days-to-turn and top-selling models in a 2003 story, PIN touted the mention on its Web site.

“It’s their data and it’s up to them to do with what they want,” said Edward Lapham, executive editor of Automotive News. “They were very anxious to help us for the longest time and to share information and it was a good symbiotic relationship because we got a very deep look at what was going on. It was really very detailed, it was good, and it was set up in such a way that the 6,200 dealerships provided a good cross-section of the United States, but it was set up that way not for us but for clients.”

PIN was formed as a division of J.D. Power 11 years ago and spun off as a separate company in January 2003. Both PIN and J.D. Power still share headquarters space and have joint public relations departments. In addition, PIN’s board of managers includes three J.D. Power executives: Chairman J.D. Power III, President and Chief Executive Stephen Goodall and James D. Power IV, who is partner and director of international operations for J.D. Power.

Peter Marlow, a partner at J.D. Power, said he wasn’t concerned that J.D. Power’s credibility would suffer as a result of PIN’s decision, though he conceded it is a possibility. “There could be some halo effect if there is miscommunication or a misunderstanding about what J.D. Power does and who its audience is, and what PIN does,” said Marlow.

He noted that J.D. Power has also released data that hasn’t been popular with automotive companies, such as its specific rankings for automotive companies that fell below the industry average, rather than a simple notation that they were below average. That decision was made to help consumers make more informed decisions, Marlow said.

“I did get criticism from some automotive companies that were at the bottom of those lists, but I also got compliments from some that were just barely below average, because they could show they weren’t lumped with the rest at the bottom of the pack,” he said.

The press coverage PIN has received arguably led to increased business, but Brown said there is some wisdom to limiting media access.

“Client companies are being asked to pay who-knows-how-many dollars to get this information, yet reporters can get this information for free,” he said. “It makes more business sense to pull it out of public domain and alleviate client concerns.”