Every Service Department in the Country Faces These Challenges Daily

  1. Lack of Customers in your Service Drive...The Right Customers
  2. Too Many Late Model Recall Units
  3. Declining Dollars per RO
  4. Too Many "Waiters"
  5. Service Retention Rates of 30% or Less
  6. Continued Customer Defection
  7. Too Many In-bound Customer Phone Calls Inquiring about Vehicle Status
  8. Too Few Aged Recall Units (3-7 Years)
  9. Minimal Success with the Sales of Additional Service Recommendations (ASRs)...20-30% is Unacceptable
  10. Minimal Success with Declined Service Marketing...2-3% Conversion is Unacceptable

These are a few of the critical obstacles facing service centers daily. These are also the same challenges that have plagued the industry for decades. Why is it so difficult to address these concerns and why do they continue? Answer-The industry has yet to address the primary reasons that keep consumers away. Consumers perceive the dealership experience as time consuming, inconvenient and intimidating.

Every Dealer and their Fixed Operations Director should look at their dealership(s) and answer the following.

  • Has my dealership addressed "Trust", do consumers perceive my dealership and personnel as trustworthy?
  • Has my dealership addressed "Transparency", do consumers perceive my dealership and processes as being transparent...does my dealership provide consumers with evidence that a repair recommendation is necessary?
  • Has my dealership addressed "Pricing", do consumers perceive my dealership as competitively priced? Franchise dealers don't need to be the least expensive, nor do they need to offer $29.95 LOFs. Be competitive in your pricing, offer both OEM and after-market components...provide your customer the option.

According to JD Power, one of the most critical areas in service is customer wait time. Wait time is in play with "waiters" and dealers promoting express lanes. "Customer satisfaction averages 835 when the wait time for a maintenance issue is less than one hour and 40 minutes. When the wait is longer, satisfaction averages about 756. The survey found 17 percent of customers will wait under an hour or not at all for their vehicle to be serviced. To help address the concerns of these customers, J.D. Power recommends offering a loaner vehicle, shuttle service, or some kind of amenities in the waiting area."

Many dealers feel their service departments are pretty busy today, the challenge is that your service drive is busy with the wrong type of customer. Keep in mind that any customer is your service drive is certainly a positive. The service drive is busy with recall business. The majority of these customers have vehicles that are 1-3 years old, still under warranty, and represent very little customer pay opportunity. The odds are that these recall customers will have their warranty work performed, there will be little to no up-sell opportunity, and industry data supports that the majority of these customers won't return.

Dealers need general maintenance and service work in their drives. Recall business is fine, however, the recall business you really want is the 3-7 year old vehicles that are out of warranty, and have ample customer pay opportunities. These are also "lost customers" that left the franchise dealer world years ago...let's get them back.

Since consumers perceive the dealership experience as time consuming, inconvenient and intimidating...how is your dealership going to address these customer perceptions? How is your dealership going to address customer wait time?

OEMs tie a lot of financial incentives to CSI. JD Power has recognized "Pick-up & Delivery" as a tool that provides significant uptick, as well as an additional 40 points worth of CSI. How much OEM financial incentive is being left on the table in the absence of "Pick-up & Delivery" service?

Service Customer Pick-up & Delivery addresses consumer perceptions of franchise dealer visits being time consuming, inconvenient and intimidating. Service Customer Pick-up & Delivery also address the 10 challenges noted previously that plague franchise dealer service departments daily. The key is to get the customer's vehicle in your service drive, without the customer visiting your dealership and being inconvenienced. Consumers simply don't have the time to bring their vehicle in for service...make it convenient and they will come.

Ken Hite is Senior Vice President at RedCap. RedCap's technology and drivers are utilized by OEMs and dealers for test drives and service customer pick-up and delivery. Ken has 25 years experience within the automotive industry, inclusive of retail, OEM, after-market and start-ups. The auto industry must learn to exceed customer expectations and implement business processes based upon customer convenience.

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