JIM BELL SAYS THAT THE REASON WHY MANY SERVICE DEPARTMENTS OFTEN STRUGGLE WITH CUSTOMER RETENTION, IS DUE TO A RELUCTANCE TO CHANGE PRACTICES INTERNALLY
It’s well known that many dealerships today are struggling with retaining their customer base, despite the fact that the vehicle park is growing and the average age of cars on the road is increasing. So let’s look at some hard facts. From a visual point of view, we work with dealerships located on busy intersections with huge traffic flow going past the door. The trouble is that traffic doesn’t stop and drive into their service departments. A recent survey in the UK showed that 70 per cent of customers believe that vehicle maintenance is a complete waste of money, so you had better do something to educate your customers and keep them coming back.
WHAT KEEPS CUSTOMERS LOYAL?
CRM tools and fancy customer loyalty systems work to some degree, but it appears that around 75 per cent of customers surveyed say that they return to the dealership based on their last experience. The question is, are you truly striving to exceed your customer expectations and leaving them with a “wow” experience every time they leave your store, or are you more hung up on what the staff want? No doubt menu pricing and being price competitive helps with retention, but what about customer convenience. It is mind blowing how many dealerships have tried fast service bays only to close them down a short time afterwards, mainly because they adopted a dealership mindset to operate a different type of business instead of thinking outside the box.
Often we hear dealership people running down aftermarket operations, without even taking the time to send a vehicle there and see how they operate. “Maybe do it on a Sunday!” We have tried several times to get a quick oil change at the local dealership, but have given up. They never appear to look busy, but when you ask the questions — such as can I get an oil change whilst we wait? — it’s as if you’ve just asked for the moon. Have you ever walked into an empty restaurant or hotel and been asked by a miserable employee looking down their nose, did you make a reservation?
When will we wake up?
We still believe that the main purpose of the business is to solve your customer problems and the objective is to make money, not the other way around. The more transparency you have in dealing with the customer the more trust you will build, which seems to be an area sadly lacking in our dealerships both in the past, present and likely the future too!
We get tired of making suggestions that will build our customers’ trust only to be told that is a great idea but our staff won’t like it or won’t do it, which takes us back to why we are in business. We told a dealer recently that business is like a baby’s diaper, if it stinks change it. His comment was, “I don’t believe we stink that bad.” So what is that smell coming from the service department?
Who is leading the industry?
We might be leading the industry with fancy new buildings and OEMs that appear to be hung up on image requirements that demand you spend millions of dollars. But before you spend the money, maybe you should be asking what the customer cares about, but again they appear to be the last thing on the list. Quick and convenient service at a fair price is high on your customer’s list along with, “I trust them.” Ask yourself who was it that started late night opening and Sunday service? The list goes on with lifetime brake pads, exhaust systems and oil changes that allow you to stay in your vehicle. We have used a tire shop in town for around the last 15 years and it’s not because of price — over the years, many of the staff have changed but one thing remains the same — they are friendly and can’t do enough for you — you even get to talk with the mechanic! Someone in this store is setting the standards and understands that they are in
the people business — it just happens that they maintain and repair vehicles.
Understanding the facts
In most markets it appears that service appointment lead times have dropped from 7-10 days down to 1-3 days even when using retention programs. This should be an area of concern, but there are more challenges. Customer paid labour hours are down typically from 2.4 hours to 1.6 hours which in real terms means this: to sell 70 hours per day, instead of 29 customers you now require 44 customers. “That is a 52 per cent increase in customers just to stay even and we have not talked about the drop in warranty dollars.” We are not in a recession — this is a market adjustment. Now could be a good time to look at what you are doing well and where you’re missing the boat. Where are your roadblocks? Is the challenge from lack of training or is it the staff’s reluctance to change and really put the customer first?
