Turning Service Into Sales
The cars on America's roads are older today than ever before. A recent study by Polk found that the average age of registered cars in the U.S. is almost 11 years old. The average car owner, meanwhile, holds on to his or her vehicles for more than six years — well past standard warranties for most cars.
But as vehicles are growing older, they're developing more and more ailments, and in a down economy, that is driving consumers to be more proactive in how they service their vehicles. The Wall Street Journal reports that searches on Google for terms like "auto repair how to" and "how to change spark plugs" have surge since the financial crisis hit in September 2008. Of course, there are still many fixes that most car owners simply cannot perform on their own. According to Edmunds.com's internal monthly statistics, visits to our site's repair shop pages have grown almost six times faster than the growth of visits to the homepage since the beginning of the year. And reports on Edmunds.com's participating dealers show more service inquiries and engagement on Dealer Service Reviews than ever before.
The influx of vehicle repairs presents dealers with more opportunities to engage car owners in their local communities. Edmunds.com identifies some tips and best practices for dealers to build and maintain connections with their customers, and improve their chances to turn services into sales.
GET 'EM TO THE GARAGE
The first step to building and reinforcing the relationship with customers is securing that all-important face time - and that requires drawing them to your service shop in the first place. A recent survey by Consumer Reports found that most car owners prefer independent shops over dealerships for their repair and maintenance work. The primary reason for that is cost, since dealerships are more likely to use factory parts than aftermarket parts.
And that's where service discounts can be helpful. Ads or online specials for oil changes, tire rotations, brake inspections and general tune-ups are all good ideas to entice drivers for services, even when their vehicles are running smoothly. Franchise loyalty discounts can also keep customers from choosing not only local independent shops, but also competing dealerships in the area.
EARLY BIRD GETS THE WORM
Many customers bring their cars in for services early in morning, and that creates lines of drivers with time to kill. Smart service advisors and salesmen can work these early-morning lines to engage drivers and learn about how long they've owned their vehicles and some of the issues and problems they might be having with those cars. This gives dealerships the opportunity to inform drivers about extended warranty programs (more on this later), parts discounts, and trade-in valuations.
GET GOOD INTEL
Service advisors can get a jump on car owners with scheduled maintenance appointments by doing their research ahead of time. Advisors can access customer and vehicle history and understand the issues ahead of time. This allows them to be prepared with specific information and pitches before the vehicle even arrives at the shop. So, if an advisor knows that an incoming customer has just six months left on a current lease, then they might be interested in some of the current "pull-ahead" promotions that are available.
WHO NEEDS A NEW CAR?
It might be tempting to try to convert as many service customers as possible into new car buyers. But not every visit to the service bay is an invite to bull rush drivers into buying a new car. Customers are easily turned off by overly aggressive tactics that try to get them into a new vehicle when they just aren't ready, and that sort of behavior can damage a dealer's reputation through reviews and word of mouth.
But there are two situations when it may well be in the consumer's best interest to trade up for a new car:
- The current vehicle has a relatively high market value on the used car market , and, in turn, could likely command a higher appraisal at trade-in.
- The current vehicle has been diagnosed with major repairs that approach or exceed its market value.
Service advisors can quickly and easily show car owners how much their vehicles are worth through Edmunds.com's car appraisal tool or through the Edmunds.com iPhone and iPad app. Edmunds.com's True Market Value® (TMV®) reflects the average price that consumers are paying for similar vehicles in the area, and offers a fair price for both buyers and dealers.
LOAN 'EM A KEEPER
If a customer is bringing in a vehicle for lengthy repairs, then offering a loaner is a great opportunity to get him or her to try out a vehicle that makes sense as a next new car. The most obvious options are to offer the same vehicle in the most recent model year or even a similar vehicle in a slightly higher class. But if the driver pulls up a sedan with child seats and toys clogging up the backseat, this could be a good time to get him or her to consider the space and convenience of an SUV or minivan.
Many customers are unaware of the loyalty programs and incentives that are available at most franchise dealerships, so it's a good practice to make sure they know that these programs exist during their service visits. And while car buyers will decide whether to stick with a brand for many reasons (not the least of which is the quality of customer service over the life of their car), it never hurts for them to know that a little extra cash incentive awaits them.
Everyone knows better health habits, advances in technology, and better health insurance all contribute to people living longer, but do they know that those same principles hold true for cars? Factory and aftermarket extended warranties can stretch major repair coverage in vehicles for many more miles and years than ever before. Dealers should explore these options with their service customers to win — and keep — their business.
Edmunds.com is available to help all participants in its Direct Dealer Program to build their businesses and maintain best practices. Find out more by contacting 1-855-EDMUNDS or firstname.lastname@example.org.