Do you find the ball stops rolling once your customers leave the lot? After-sales services are a huge part of the auto market, and yet many dealerships fall short brining in old leads. Forbes reported that gross profit margins for after-sales services were much higher than the sale itself, but at the same time, many dealers treat services as the unwanted middle child, with little support and no fancy dressings.
Let’s talk numbers. An Accenture study found that GM had a revenue of $150 billion in car sales, and $9 billion in after sales services. Pump more money into the vehicle sale? Nope, those $9 billion in after sales services brought in more profits. With such huge returns, certainly GM has coddled the service industry unlike any of its competitors, right? Nearly 50% of customers reported service delays because dealers didn’t have the right parts easily available. Not really the peak of performance we would expect.
When we look at the market, after-sales service has a significant impact on customer satisfaction, and in return, on dealership ratings. The International Research Journal of Management Sciences found that along with a significant correlation between customer satisfaction and after-sales service performance, there are markers that businesses can target to improve customer satisfaction in after-sales service. These markers include:
- Thanking customers for business
- Using email to confirm sales arrangements
- Inviting and referring customers to online services
- Promptly replying to customer contact and inviting calls
- Contacting customers after purchase to check for satisfaction
Establishing personal contact early is one of the most important indicators identified by the IRJMS study. According to Cars.com, dealerships who have the highest response rate to customer complaints had the highest dealership ratings. These unhappy customers leave reviews more often and much faster than any other demographic – you must catch them quick.
So, there’s all these indicators, and you know keeping in touch with the customer is important, but how do you do it? What is the secret to keeping the conversation rolling after the sale?
Establish A Digital Platform
Having a nice brick and mortar is good, but with the rise of internet sales you’re likely to catch more cobwebs than conversions without a strong digital presence. Much of your customer contact is going to come from behind the keyboard, it’s your job to make it as easy as possible for them to make that connection happen.
Integrate your website with communication channels, provide information directly to customers instead of hiding it behind a subscription or in the back corner of your HTML. Consider this, if you google a question and click on a site where you have to login to see the answer, would you? No, you’re going to hit the back button ASAP and find a site that values its customers more than its subscription count. You haven’t earned a subscription yet, throw your customers a bone first.
When it comes to online browsing, dealer reviews are the make or break of the sale. Manage complaints through your system to convert as many negative experiences to positive ones before they leave your internal ratings. Deloitte found that those dealerships who responded most often and most immediately to customer reviews were rated highest, it’s a little effort that goes a long way.
What about services? Offer scheduling and appointment tracking through your own online application. You may find that your fixed operations department is suffering from a digital black-hole. Throwing your hands in the air and ditching the web isn’t the answer, spending real time implementing a solution that works is. Some of the following solutions outline easy implementations you can make that are proven to yield huge returns in fixed operations.
All of these features not only improve satisfaction, but directly impact retention as well. The fewer other sites leads have to visit, the more likely they will finally land on yours.
Turn on the smartphone and start texting. Customers like when they are texted updates about service appointments. They really like it. According to J.D. Power, 67% of customers contacted by text message for service reported they were “highly likely” to return to that dealership for future services, 12% higher than contact by any other channel.
And while there is a 12% increase in positive customer response, only 3% of dealerships reported incorporating text message technology. The technology to implement is out there, companies just aren’t willing to put out the effort to reach the easy dollar.
Inventory Management Systems
Inventory management has nothing to do with the customer, does it? That’s just boring business stuff. You’re right, inventory management is just basic business, but it’s basic business that many dealerships get wrong, and basic business that has a huge impact on customer retention. Basic business needs to be the baseline, adding bells and whistles on top is where you make your money.
Remember before when I said nearly 50% of customers reported service delays due to poor inventory? According to an Deloitte study, customers are only willing to wait on average 45 minutes for simple maintenance. Don’t think you can cut corners to save money and time, when service isn’t done right, overall customer satisfaction ratings for a dealership drops by nearly 25% (J.D. Power). Dealerships just aren’t investing the necessary money to build a sufficient service system, the very system which should generate a large portion of their profits.
What better way to get face to face with a customer than behind a computer screen. Online video calls let you connect with a customer in a personal channel from a comfortable location. One of the highest indicators of customer satisfaction is personal contact points. Face-to-face interaction allows for you to cater to customer convenience, and reinforces your presentation of customer experience priority.
Video calls also allow you to have a record of conversation and to begin the sales process before customers walk in the door. Maintaining a personal client record improves service efficiency and
customer satisfaction. Video calls can also be used to pre-diagnose potential service issues so parts can be ordered before the customer brings in their vehicle, expediating the time-sensitive process.
Don’t Burn Out
There’s a fine line between intimate contact and obnoxious spam, and when marketing to customers who have a whole laundry list of other service centers they could choose instead at the tip of their fingers, you need to tiptoe that line carefully. Keeping communication channels open for relaying service information during the service process is important, drop out of these high-level channels shortly after service is done.
Sending birthday wishes, or a happy holidays greeting is an excellent way to stay in the customer’s mind without invading their inbox. Bloomberg cites a study by Bain & Co. when they argue that while many dealerships are happy to get everything done, the real leaders are the ones that go out of their way to surprise their customers. While the quality of a vehicle purchased is one of the most factors in customer loyalty, customer satisfaction from after deals services is the greatest hinge in retention.
Keeping in touch with your customers can be easy, you just have to put in the effort to make sure the wheels keep turning.
- http://irjmsjournal.com/wp-content/uploads/paper491.pdf http://www.jdpower.com/press-releases/jd-power-2017-us-customer-service-index-csi-study
- https://www.bloomberg.com/news/articles/2008-09-23/after-sales-service-key-to-retaining-car-buyersbusinessweek-business- news-stock-market-and-financial-advice
- https://www.forbes.com/sites/jimhenry/2012/02/29/the-surprising-ways-car-dealers-make-the-most-money-off-of- you/#47b4c5bc1e6f
- https://www2.deloitte.com/content/dam/Deloitte/us/Documents/manufacturing/us-auto-global-automotive-consumer-study- 100914.pdf