Despite strong auto sales in recent years, Xtime’s Jim Roche, SVP of Marketing & Managed Services—along with other industry experts—predict that we could be headed for a downturn. However, this does not mean that dealers need to batten down the hatches; it simply means that in order to stay profitable, they need to rethink where their revenue really comes from.
The key, Roche says, is to optimize the service drive. Studies show that providing each and every service customer with a superior ownership experience from the time they arrive to the time they leave is the secret to increased customer retention, which drives profitable growth. From loyal service customers to future sales and referrals, 85% of car buyers say that a positive, customer-centric experience increases their chances of purchasing future vehicles from that particular dealer.1 Yet, 72% of car buyers do not revisit that dealer for service within a year of purchase.2 Why? Because they don’t see the value in it.3
So how can dealers change this? The answer is price transparency and providing an outstanding service experience. A recent survey shows that 70% of service customers consider price transparency to be “extremely” or “very” important when scheduling service appointments.4 Think of it this way: you wouldn’t buy a smaller-ticket item such as a pair of shoes without knowing what the price is, so why should the price of vehicle service be any different?
According to Roche, in order for dealers to prove value to their new and returning customers and boost loyalty, they don’t need to charge less—they just need to ensure their prices are accurately quoted and transparently available.
While price transparency is crucial, offering customers a seamless, premium ownership experience is also vital to retention and reclaiming lost souls. Today’s customers expect convenience; in fact, 76% of customers surveyed stated that being able to schedule an appointment online greatly increases their chances of revisiting that dealer.5 Not only is that a tremendous number of customers, but online scheduling can also increase the chances of having customers book appointments in advance, further streamlining the service drive and enhancing the overall experience.
1. Cox Automotive Maintenance and Repair Study: July 2016
2. Cox Automotive Maintenance and Repair Study: July 2016
3. Cox Automotive Maintenance and Repair Study: July 2016
4. Xtime Market Research: 2016
5. Cox Automotive Maintenance and Repair Study: July 2016