A Man with a Vision: J.D. Power Gives Customers a Voice

A Man with a Vision: J.D. Power Gives Customers a Voice

LMU’s College of Business Administration was fortunate to have business icon J.D. “Dave” Power grace the Hilton stage for the second time in the last five years. Moderated by President’s Professor of Marketing David Stewart, Mr. Power had an intimate hour-long chat with the LMU business community about starting J.D. Power and Associates from his kitchen table and the lessons he’s learned over the years.

The Voice of the Customer

After earning his MBA from the Wharton School at the University of Pennsylvania, Power joined the Ford Motor Company as a financial analyst before switching over to marketing research. He hopped between several other firms, eventually landing in Los Angeles.

“In those days, market research firms could only work for one company within an industry,” said Power. “I felt the research was biased and the people who purchased it didn’t understand what they were getting back and often altered the data.”

Frustrated that no one would listen to his ideas, Power founded J.D. Power and Associates in 1968 and began conducting his own marketing research, much to the chagrin of the automotive industry. With the help of his wife Julie and three children, Power mailed surveys to industry professionals, tabulated the data and sold the results. It took years to convince the industry to accept this new method of gathering data. The first customer satisfaction survey was administered in 1980.

Building a Brand

According to Power, the media had the most significant impact on the success of his company. In 1972, Mazda introduced a vehicle with a new rotary engine that took the country by storm. Power surveyed the first 2,000 buyers and discovered that 1 out of 5 vehicles that reached 30,000 miles had to get the engine replaced because of an oil ring problem. After publishing the report, Power got a call from a reporter at The Wall Street Journal. The next day, the story was on the front page of the newspaper, which really catapulted the firm to a national status. Subaru was the first automaker to advertise its J.D. Power rankings by running a commercial during the 1984 Super Bowl. Several years later, the firm was featured in a segment on 20/20 that solidified its credibility.

A Powerful Approach

Power credits the four years he spent in the Coast Guard for helping him understand how to work with people. In charge of over 800 employees in the late 1990s, Power took a unique approach to his management style which worked very well for the company. He would go around the office checking on people and making casual conversation. Power wanted his workforce to operate like a family and his leadership style was a big reason why the company had such a strong support system in place.

The Future of the Automotive Industry

Power has witnessed a lot of change in the automotive industry over the last 50 years. He believes the current industry is at a crossroads and is being challenged by new companies (Tesla) and technologies (electric cars).

“We’re going to see the disappearance of automobiles as we know it,” said Power. “Technology is developing so fast and change is more rapid. Middlemen are going to disappear and selling is going to be much more direct in this new digital age. It’s an exciting time.”

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LMU is currently ranked #19 amongst top graduate marketing programs by U.S. News & World Report. Dr. David Stewart teaches several marketing courses in the LMU MBA Program including “Advertising and Promotion Strategy” and “Competitive Marketing Strategy.”