After numerous disruptions in recent years including the COVID-19 pandemic, the service department has grown increasingly important to dealerships’ bottom lines.
According to an IHS Markit mid-year report in 2021, the average age of a passenger vehicle on the road rose to 12.1 years, accelerated in part by new vehicle inventory shortages prompting customers to hold on to their vehicles longer. In that same report, IHS Markit also noted the industry is entering a period of strong growth in the aftermarket “sweet spot” – vehicles 6-11 years of age – over the next five years.
Meanwhile, drivers are continuing to put wear and tear on this aging fleet. After dropping in 2020 due to the pandemic, the average vehicle miles traveled (VMT) for light vehicles in the U.S. reached 12,355 miles in 2021.
To maximize future maintenance and service-to-sales opportunities, delivering an excellent customer experience in the dealership service drive is more important than ever. Excellent customer service will help improve the experience of getting a vehicle serviced, and will also improve loyalty and ultimately sales. Now is the time for auto dealers to assess their service drive and other critical fixed operations processes, tools and culture for what kind of experience they are creating for customers.
In this post, we’ll discuss:
· How a positive service drive experience drives future sales despite disruption
· How to identify service-to-sales opportunities
· How customer respect relates to long-term dealer loyalty
Service Drive Experience Drives Future Auto Sales
At every dealership in the country, the experience a service-not-sold customer has with your dealership will play a massive role in their eventual decision of whether to purchase their next car from you. According to research from Google, after the sales experience, a customer’s maintenance and service experience was ranked No. 2 in influencing automotive brand loyalty.
Conversely, a bad or unsatisfying dealership service drive experience puts your service customers’ loyalty at risk. Losing a service customer means not only losing service ticket revenues, but also likely their next vehicle purchase.
automotiveMastermind data finds customers who service at the dealership are 2.5x more likely to purchase their next vehicle at the same dealer. Losing service loyalty drops sales loyalty of future auto sales from a virtual sure thing to a long shot.
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3-Step Guide to Protecting Your Dealership Loyalty Customer Base
To retain service-not-sold customers and hopefully convert them into service-to-sales customers, focus on ways your dealership can break down the barriers between you and your customers. Consider tactical ways of improving the dealership service experience that meet customers new and evolving expectations, such as:
· Complimentary vehicle pick-up and delivery
· At-home maintenance services
· Video calls with service advisors for initial diagnostics and evaluations
· Continuously updated messaging on your website and marketing materials regarding all current safety guidelines and expectations
Prospecting and Personalization: Great CX From the Start
Service drive sales aren’t stopping in the current environment. In fact, they’re becoming even more important as traditional auto lead generation strategies and showroom visits become more challenging. After a dip to just $51.9B total revenue in 2020, NADA reported service department sales once again soared in 2021, reaching $60.4B by June 2021.
Now as in-person sales are slowing for myriad reasons, hastened by new vehicle inventory shortages, some dealers are shifting the focus of their dealership customer experience from the show floor to the service drive. With customers waiting longer between vehicle purchases, the service lane is increasingly serving as the front door for dealership sales.
Download the Guide:
Working the Drive 101: How to Maximize Service-to-Sales Revenue
How to Break Down the Barriers Between Dealership Service & Sales Departments
To nurture service-to-sales leads and promote customer retention, dealers need to meet and exceed customer expectations. This requires dealers to break down the barriers between service and sales to create a consistently excellent customer experience.
We’ve written before about the importance of having a formal connection between service and sales within your automotive customer journey. Many dealers have dedicated a member of their service, sales or BDC team to mine their service portfolio for opportunities.
This is someone whose primary role is to contact the best service drive sales prospects with whom you have scheduled dealership service drive appointments. Then they should begin a “consultation” process that includes a targeted and personalized sales offer made during their service appointment (or via video or phone). If you haven’t already, this is the time to identify the right person or people on your team to own that role.
Download the Guide:
Strategic Staffing Checklist for Dealerships in 2022
How to Market the Service Drive to Fuel Dealership Sales
Of course, service-to-sales opportunities exist beyond your own customers, as well. Research finds consumers are unlikely to travel more than 20 miles for a car service experience. Focus your service conquest marketing to your local community with proximity and convenience messages to try and keep their business out of the hands of your competition.
Typically, an inner 10-mile radius is the prime territory for a dealership’s service marketing campaigns. Start with the lowest hanging fruit opportunities, targeting local same-brand owners who have purchased their current vehicle from another rooftop and expanding into other similar brands whose vehicles their technicians are prepared to repair.
For guidance on how to effectively increase the number of service drive appointments in the current environment, we created best practice outreach templates and call scripts to use as a starting point for your own team.
A Little R-E-S-P-E-C-T Goes a Long Way
One of the simplest and most important concepts in a positive dealership customer experience is respect. Research shows many consumers – and an increasingly large share of younger shoppers – do not feel respected by dealerships. Rather than generating best-in-class customer service, this lack of respect, in turn, creates countless negative experiences, drives down purchase intent and damages long-term customer loyalty.
Evaluate whether your dealership’s service drive is showing respect for your customers in large and small ways. Here are some questions for your dealership’s service department to consider:
· Are you respecting your customers’ time? What could you do to get them in and out faster, or to make it so they don’t need to come in at all?
· If they do come to your dealership, are you giving them options on how to spend their time in a productive or enjoyable manner?
· Are you respecting their vehicle and what it means to them? Are you fixing it quickly and completely?
Remember the old saying, “time is money.” Decreasing the amount of time your customers have to spend interacting with your service drive will increase their likely monetary value to you over time through improved loyalty and future sales.
If you’d like more insights on how to improve customer experience in your service drive and maximize profits, watch our webinar on working the service drive in the current market.
We’re also constantly adding to our collection of actionable service drive resources for dealerships.