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Customer Retention: Let Your Service Soar

By May 5, 2019August 26th, 2019Service Drive

The rise of digitization and rapid change in the competitive landscape is driving dealerships to look for cost-effective ways to invest in customer retention.

Improving customer retention is a proven strategy propelling higher profits. Research from Bain & Company has shown that a 5% increase in customer retention boosts a company’s profitability by over 25%. How is this boost achieved? Simple. Loyal customers will trust your service and will buy repeatedly over time.

As new vehicle technology advances and frequency of repairs is reduced, dealerships need to create memorable service experiences to drive long-term customer relationships and loyalty. This requires dealership staff to transition from being product-centric to being customer-centric.

However, the challenge to retain customers is significant. According to NewVoiceMedia’s 2018 “Serial Switchers” report, 67% of customers have become serial switchers because of a poor customer experience. For these customers, brand loyalty is more than just owning a great product – they want to be inspired, educated and leave feeling positive.

Reports from JD Power consistently highlight trust and price as leading reasons why customers leave franchised dealerships for aftermarket service providers. In reality though, it’s the failure to justify the value of genuine service, in a way a customer can understand. Unfamiliar technical jargon and vague repair estimates leave customers feeling vulnerable and less trusting of dealership staff, leading them to switch to aftermarket repairers.

To innovate and improve the customer experience, top performing dealerships are adopting technology aided processes. Creating a transparent and customer friendly service process helps build a stronger customer relationship and increases the probability of retention.

Knowing your customers

Collecting and managing meaningful customer data is critical in setting up an effective retention strategy. Converting the data into actionable insights, helps your staff execute more personalized and timely engagements.

Imagine if you had the insights to answer the following questions:

What proportion of your local area’s car parc is retained by your dealership? Do you have real-time reporting of lapsed customers?

Can you easily schedule automated service reminders at an optimum time for each customer? Can you see what safety related repairs were previously declined? What offer would they be open to?

Did you survey the customer’s satisfaction during their last visit? What did they reveal? What do you have to improve to keep their business?

Empowering dealership staff with technology that harnesses these customer insights is critical.

Deliver an experience that meets your customers’ needs

Answers to these questions are insights that help your staff create a better service experience by anticipating what customers need without them asking. Customers have a myriad of choices. Receiving personalized information about the safety and performance of their vehicle is critical to their decisions and how they value the genuine service experience.

Merging trust with your genuine service process shows customers they are valued, that you care for their wants and that you have created a service experience that exceeds their needs.

Here are some focus areas to consider in reviewing your customer retention strategy.

1. Be engaging and transparent

Personalized services build emotional connections with your customers, makes them feel valued and differentiates your brand. Timely communication before the visit is just the start. Greeting the customer in the drive, explaining the work required, asking if they have any concerns, and displaying their vehicle information on the Greeter Board, all contribute to a memorable experience. Walk your customer through the service process and communicate in a way they can understand. Showing photos and video of repair recommendations and replaced parts, creates transparency and trust. Make a promise on delivery times and exceed it.

2. Customer loyalty programs

Genuine parts and specialized factory knowledge and equipment are great reasons for customers to stay with you, but effective loyalty programs have real impact, as we’ve seen in other industries. Loyalty programs that add value make customers feel appreciated. If they have been a long-term customer, a timely special customer loyalty offer reinforces the reasons why they keep returning.

3. Voice of the customer surveys

How did we perform today? How else can we help you? Showing customers that you care about their opinion and that you are listening is the first step to creating a genuine connection. Regular feedback from surveys is a gauge of customer experience and helps cultivate positive brand advocacy. Capturing this feedback before a customer leaves also improves chances of resolving customer concerns, turning an unsatisfied customer into an advocate.

4. Invest in your people – the experience creators

The dealership service and parts staff are the experience creators – they are the face of your brand. Empowering them with data-driven technology allows them to shine during the sales process. Fast, accurate and transparent customer service positions your Technicians, Service Advisors and Parts Counter as problem solvers. Your staff doesn’t have to worry about model codes, part numbers, engine codes, transmission codes, supersessions and the other data that causes friction during the sales process. The right technology helps your dealership transition to being customer-centric, and have a lasting impact on customer opinion, to drive differentiated experiences and long-term loyalty.

5. Keep innovating

Being customer-centric and adopting the right technology prepares for continuous innovation. Evolving customer experience is critical as vehicle technology and lifestyle factors keep converging and Millennials become the dominant buying group. Expectations will continue to change as connected vehicle technology grows, also resulting in more automated communication between the car and the driver. Customers expect that you know everything about their servicing needs and their buying preferences, requiring your people, processes and technology to be totally in sync.

Customer Experience is the future

Invite your customers to be part of the experience. Make it enjoyable and make it seamless. With so much technology to call upon, implement strategies that you think will enhance connectivity with your customers. Stay relevant, update your services and make changes when competitors emerge. If there is anything to be digitized or simplified, be the first to make the changes.


Peter Petrovski
Marketing Director

Peter is the Marketing Director of Infomedia Ltd. He is a strategic technology executive with a passion for innovation. Peter has 20 years’ experience in product design and marketing of aftersales software that drives revenue growth and customer retention.