What Motivates Your Service Customer?
With consumer expectations quickly rising, dealers are working to get ahead of the curve and build experiences that meet the needs of vehicle owners. Releasing the second phase of its recent Service Industry Study, Cox Automotive surveyed approximately 3,550 consumers and 404 franchise dealership employees to gain greater insight into consumer trends and perceptions around the service experience, and help dealerships identify new opportunities to increase retention and enhance profitability.
According to the study, while dealers may be leading their competitors in share of service visits, an estimated 70 percent of consumers who purchased or leased from a dealer did not return for service in the past year. This equates to roughly $266 billion in annual lost revenue across all franchise dealers.
The good news is more than half of consumers reported they would be willing to travel farther and pay more for an enhanced service experience, helping overcome the top two barriers to dealership service retention. This means dealerships that want to grow share in customer-pay service need to be adopting new offerings and technologies, such as online bill pay, minimal-click scheduling via mobile devices and ride-share or valet service.
“With consumer satisfaction and loyalty dropping across all service providers since 2015, now is the time for dealerships to take a closer look at the experience they are providing their customers and upgrade to adapt to changing expectations. This will be particularly critical to retain millennials, who are the fastest-growing generation of car buyers today, but also the most dissatisfied with the current experience,” said Jim Roche, vice president of marketing and managed services at Xtime, a Cox Automotive brand. “Dealerships have a prime opportunity to increase customer satisfaction, and as a result, loyalty and retention,” Roche said. “Dealerships, though, need to develop a better understanding of consumer needs and expectations for the service experience. The insights from this study will help dealerships identify where the customer experience is currently falling short and what can be done to repair it.”
Ultimately, consumers are motivated by a service experience that is convenient and stress-free, revealing the following five opportunities for dealers to meet the demands of today’s consumer and help differentiate their business from third-party service providers.
- Enable Ease of Maintenance: According to the study, many consumers want the dealer website to be their primary touchpoint for maintenance — approximately 67 percent want to be able to track service history on the dealer website, while 62 percent want recall updates and service reminders with links back to the website for online scheduling and other tools. Sixty-two percent of consumers also want to view OEM maintenance recommendations via the dealer website.
- Provide Price Transparency: Seventy percent of consumers want to view price ranges for various services on the dealer site, while 55 percent would choose one dealership for service over another if it provided online estimates of costs during the scheduling process.
- Move Offline to Online: Consumers feel moving steps in the service process online will improve the experience — particularly when it comes to online scheduling. In fact, 56 percent of consumers would choose one dealership for service over another if they could schedule appointments online. Despite this, scheduling is still primarily an offline activity due to continued low awareness. Among those who don’t make appointments online, just 35 percent are aware it’s an option their service provider offers.
- Close the Distance Gap: With location a top reason for not returning to the dealership of purchase for service, dealers need to be willing to embrace mobility solutions to help overcome this hurdle. According to the study, two in five consumers are interested in service mobility concepts, such as valet service and mobile service providers.
- Service Valuation Analysis: Consumers increasingly want to know the ROI on their service dollars. Two in five want to understand the relationship between services needed and vehicle value, while one in three are interested in getting a trade-in value during the service experience.
“So many people in our industry will find a reason to look at the customer and say, ‘My job isn’t to see it your way but to get you to see it my way.’ But we need to look at everything through the eyes of the customer,” said Steve Nicholson, director of operations at Temecula (CA) Hyundai. “Other dealers want to try to make as much money as they can from every customer, but in parts and service we have the opposite philosophy of that. Rather than take a lot from a few, we want to gain a little from a lot. We want to see the customer more than once.”
This Article provided by Cox Automotive.