A recent study found that 34% of consumers are loyal to their dealership service centers. That means 66% of your potential customers may end up elsewhere. While owners with vehicles still under warranty may regularly show up on your dealership service drive, 71% move to another shop after five years. How can you hold onto these customers?
Let’s start with why vehicle owners don’t return to your dealership. It’s likely one or more of these factors: customers want convenience, a reasonable price, and trust in their repair shop. Every service department should understand those needs. Here are some tips for hanging on to your customers for life:
- Understand the Customer Experience
Take a step back. How does your service department look from a customer’s perspective? Keep in mind what customers are looking for today. Convenience is a keyword for them, and often dealerships are set up around internal procedures more than customer needs. Take a little time to observe that service waiting room, how folks answer the phone, and how your customers interact with your people.
You need to be able to fit within their schedule. Many consumers believe services are less convenient and take longer at a dealership . Research has shown that consumers rank dealerships below chains and independent shops for convenience. Have a “secret shopper” book a few appointments over the phone, order an accessory, or ask for a repair estimate at your dealership and see how it goes. Taking that walk in your customers shoes can unearth problems you can work on.
- Address Customer Needs
Is your shop location a challenge? It’s not likely you can pick up and move your shop location, but there are ways to make your location less of an issue.
A popular solution is SPUD. Not the potato, but offering Service Pick Up and Delivery (SPUD). Currently, a lot of dealerships are offering some type of service to help customers come and go . The result? Customers who use SPUD are highly satisfied and are more likely to choose a dealership that provides SPUD over a shop that doesn’t.
And importantly for you, half the consumers surveyed said they’d pay $20 for SPUD, so offering pickup and delivery isn’t an incremental cost you necessarily have to bear.
Another consumer favorite is remote servicing. About 55% of customers prefer to have their vehicle serviced at home or work. As with SPUD, remote servicing customers tend to be more satisfied with your dealership.
While it’s still a tiny share of the market, the ability to pay remotely or online has some big fans. Consumers who use those options register greater customer satisfaction scores. And with time, more customers will demand the ability to pay remotely.
- Deal with Price Perceptions
Nearly 6 out of 10 vehicle owners believe they’ll be overcharged at a dealership. That’s a tough perception to overcome, even if it isn’t true. In fact, dealerships often are more competitive than consumers think. But, they’re not always great at helping customers understand service in an apples-to-apples comparison.
Say you provide the customer with an estimate for OEM-specified full-synthetic oil and an OEM filter, and the customer gasps. They mention they’ve seen oil change specials advertised by chains at half the price, not aware it’s for conventional oil and an aftermarket oil filter. To combat negative price perceptions, keep track of competitors’ pricing for common services, like oil changes. By having that chain’s ad on file, you can point out the differences.
- Build Trust with Customers
Many consumers believe that dealerships don’t keep shoppers informed or updated during service. A chain or independent shop typically has a lower car count each day, allowing them time to update their customers.
Consider adding a real-time text message system if you’ve not already done so. These systems send automated updates on the vehicle’s status, including images of the repairs, additional recommendations and an estimated completion time. As customers feel more part of the process, you’ll see more favorable responses and higher satisfaction.
- Connect with Current Customers
Keeping your existing customers is key to any successful business. The rule of thumb is that it costs 6 to 7 times more to bring in a new customer than keep your current customers happy. Winning new customers should grow your customer base, not just replace the ones who’ve left.
Sometimes when dealerships focus their marketing efforts on attracting new customers, communications with existing customers can suffer.
How can you stay in front of your existing customers? Dealerships that have CARFAX for Life keep their customers updated and in the loop with a monthly Car Care dashboard. The tool provides smartphone updates courtesy of your dealership. It alerts vehicle owners to upcoming maintenance and directs them back to your shop.
Whether they’re bringing you their new car under warranty, or a high-mileage gem, when you get better at connecting with your customers, you’ll keep more of them happy and coming back for more.
Want to learn more about how CARFAX For Life can improve your service customer retention? Contact us.
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