With maintenance times on today's better built cars getting longer, what is a poor service man-ager to do?
Sure, you can keep the technicians busy by looking for more warranty work to do on one- to three-year-old vehicles. But this could lead to an unexpected warranty audit. Better yet one can be proactive in aggressively pursuing and keeping more of your customers.
The following A-Z list gives ideas of how to keep more of those customers coming back for service - even if they didn't buy the car from your dealership.
Accountability: Bob Dylan says in song "...you gotta serve somebody." Nowadays accountability means you not only have to "serve" the customer, but also the manufacturer, and don't forget the dealer principal. After all he signs that paper that pays for your house.
Boards: Before dealerships sold everything a car would need: tires, batteries, wipers, dammit, they even had gasoline pumps! In the last 20 years we have left the door open to other competitors. It's time we started closing some of those doors. That's why additional services menu boards are so important. They illustrate to the customer that we are a one-stop shop for all your auto needs; be it tires, wipers, detailing and shock absorbers - to name a few.
Comparison boards are useful tools that have become more popular in the last few years. For good reason. People in this country perceive dealership parts and labor to be expensive. Posting common maintenance operation's in full view shows the customer you're competitive.
Dealership service departments must be on the lookout for keeping clientele and finding new products and services to sell. Or complacency will consume most everyone in the dealership.
Competition: In the great business and leadership bible The Art of War - Sun
Tzu once wrote "Know the competition and know yourself...and you will never lose in battle." In other words know your strengths and your weaknesses, know competitors' strengths and weaknesses, and you will win most of the customers.
Decarbonizing: This is one of the most important additional services dealers can provide for older make cars. Nowadays, people still come into the dealership asking for tuneups, but their owners manual says they do not need one until 100,000 miles (platinum spark plugs anyway). Confusing, isn't it? However, this does not mean that we are going to shoo the customer away. It does mean that we can provide them with a beneficial service like a de-carbonization in lieu of a tuneup or, better yet, in addition to one.
Empathy: A good service advisor must show tremendous amounts of empathy, among many other traits. We forget the anxiety the customer feels when he or she brings the car in for service and is hearing an unwanted noise. All the customer knows is that the bill could be $100 or $1,000. It's human nature to automatically assume the worst until informed that it's just a minor repair.
Speaking of anxiety nothing vexes a customer more than surprises. That's why we must evaluate the work in progress of the customer's car - constantly. If the customer isn't informed of a delay, and he comes in to pick up a car that's not ready - OOOOH!! Pity the poor service manager!
Fire: Don't be afraid to fire a customer. We can fire our employees, why not customers? Especially ones who when we give them an inch, guess what they take? Some customers aren't worth it. They are out to take you. Even worse they steal the morale from your employees because they are incorrigible.
Greet: Greet every person as they walk into the dealership. Safeway, 7-Eleven and Walmart started implementing this policy years ago. Hasn't seemed to hurt them.
Help: Don't be afraid to seek help. We cannot rely exclusively on the manufacturer to cure our service and parts department problems. After all the manufacturer does things on a macro level, we have to do things on a micro level.
Some of their programs may work great in Michigan; however, they may not work so well in Arizona. So don't be afraid of hiring local professionals to help improve marketing programs, customer satisfaction or employee morale.
Interest: Show interest in your customer. I'm not talking about just who they are, what they drive and where they work. I'm talking about psycho-graphics like their hobbies, organizations they belong to, activities they do on the weekends. Some of the best service advisors, like the best salesman, are those who take the time to read people, even before they say a word. They can often tell, by what a person is wearing, where their activities lie.
Justify: Justify the work to be done. A great service manager told me, "For most people justification equals value." In other words, if we explain to the customer the need for a brake fluid flush, the better the chance of selling it.
Kaizen: Leave it to the Japanese to come up with a term which is synonymous for Toyota and Honda's success: "continuous improvement." We should constantly try to find ways to improve our service. Who would know better to improve our service than our customers? Right, our employees. To implement an effective Kaizen approach implement a recognition and reward program so that the best suggestion for improvement wins something special; a dinner for two, a gift certificate, a plaque - something.
Loyalty: Loyalty programs are a marketing concept which has come of age. Just look at the airlines' frequent flyer programs. I'm not suggesting a dealership has a frequent driver program; however, loyalty programs can be set up easy enough in-house. Multi-use customers can be given cards which offer them specials on parts and labor. Or they could be given free a oil and filter change after purchasing so many first.
Maintenance reminders: For those dealerships which don't have a maintenance reminder program - what are you thinking? Whether it be done in-house or outsourced, I know of very few service managers unhappy with the results.
Never assume: We have all heard stories of a raggedy person walking on the lot, and all the veteran sales people ignore him as an unlikely prospect. A rambunctious green salesperson hastily runs up and greets the customer, and low and behold the guy buys a crew cab pickup in a transaction that took less than an hour. Never make the same mistake in service.
Opportunity: Opportunity missed is opportunity gone. When a customer calls in and books an appointment, the professional advisor must plant the seed over the telephone that they are due for other services. If the seed is not planted, then it's easy for the customer to say, "Just do the oil change and tire rotation." Opportunity missed is opportunity gone.
Proportion principle: Twenty percent of our customers give us 80% of our revenue. Conversely, 80% of our database gives us 20% of our business. If every staff member of our dealership knew this we would bend over backwards for our 20% gold customers now wouldn't we?
Recognizing your best customers is the first step to keeping those customers for life. A "Loyal Larry" comes in, you have seen him periodically for the last couple of years. Recognize that he is one of the 20% customers - buy him breakfast at the dealership restaurant, give him a complimentary wash and vac, do something for him!
A customer is worth $322,000 in revenue over the span of his automobile driving days. This takes into account parts/service/accessories sales, vehicle purchases, referral purchases and such. If our staff remembered this, our CSI would be tops in the region.
Question: Question, Question, Question. Ask the customer why they don't think they need that service done. Ask the district service manager why the other stores in the region have better accessories sales. If we don't ask, we won't know!
Rapport: Rapport building is so important nowadays. After all people buy from people. Remembering not only who the customer is, what they drive, where they work, how many kids they have is all pretty important stuff. We have to continuously look for common denom-inators we have with our customer. It may be Boy Scouts, Toastmasters, sports, bridge - some interests other than getting his or her car serviced.
Signs: "Signs, signs, everywhere are signs, blocking out the scenery, breaking my mind." So sang the Five Man Electrical Band. But signs in a dealership service department can be the best "silent salesman" that we have.
Signage gives the customers something to read while they are waiting for their car, it can educate the customers as to the importance of CSI surveys, it can illustrate the importance of having a 50-point inspection.
It can do a number of things - but mainly it can show the consumer the breadth and depth of services that can be done by your dealership. These services can be anything from detailing to de-carbonization to wax/polish to winterizing specials. The list is endless, as long as it doesn't block out the scenery or break minds.
Training: Service advisors and back end staff are in a thankless position. People are generally happy when they come in to take delivery of their cars. They are usually not pleased to bring their cars in for service. They would much rather spend their money on something else. This is why back end training, specifically for service advisors is so important. Motivational refreshers, customer handling and product knowledge are usually overlooked.
Manufacturers are finally now providing some service/parts training. Is it enough? A wise sales manager once told me, "If you think education is expensive, try ignorance." Upsell the upsell, not:
Guest comes in for an oil change and a tire rotation. While the technician has the wheels off, he notices that the brakes need replacing. The customer does not have time to get them done today, so he re-books next week. During the next visit the brakes are getting done, and a new technician notices that it is probably due for an alignment (uneven tire wear). The service advisor mentions that to the customer. The likelihood of that customer getting irked is greatly increased.
This is a classic case of upsell on the upsell. I don't know about you, but I would feel as if this Service Department is always out to get into my wallet.
Very satisfied? Unfortunately or fortunately, CSI and SSI are the most important acronyms a service manager lives by. It is unfortunate because often the dissatisfied typically take the time to fill out the forms. It is fortunate because you can assume satisfied customers are the reason for unsent forms. At least this is one barometer of the satisfaction level of patrons to the shop. Very satisfied must be the rule(s) of the day. If there is any other answer the customer should talk to the service manager.
W.I.I.F.M.?: That stands for "What's in it for me?: " One of the single biggest reasons why we have clashes between the sales and service/parts department is WIIFM. The used-car manager is paid on gross of his department; so why would he want to spend $500 on running boards through the parts/service department?
He can have them sent out for $325 down the street and save $175 gross profit for his department.
Progressive stores I have seen are now paying their management on profitability of all departments, not just the department they manage. Thus, doing away with WIIFM.
X-promotion: Also known as cross marketing. Cross promoting is an alliance with another business to add value and awareness to the products and services of both companies. The manufacturers do it all the time.
The manufacturers know the psycho-graphics of their buyers and has tied in with another company to tap into a consumers' lifestyle. How can a dealership set up a cross promotion? Easy, look for a local reputable company with similar types of customers and tie in a campaign where each company gets to share each others customers.
This could be providing "value added savings" for the other establishment. Could be a contest where both companies split advertising costs and reap twice the benefits.
Yell quell: Quell the desire to yell at your staff. Enough said!
Zenith: Many service managers already know what we covered. It doesn't hurt to be reminded. And if some of these ideas are implemented, it could put your department on the zenith compared to other stores in the region.
Dave Skrobot of Dealer Strategies is a fixed operations trainer based in Calgary, ALTA. He's at 403-660- 2760.
Service departments should generate 20 cents net profit for every $1 of labor sales, and helping service managers better control expenses can help get them there.
For every $1 of labor sales, the technician is paid 35 cents, nonproductive service deparment personnel 25 cents and service department overhead expenses 20 cents. Financial statements can clue managers to out-of-line expenses and opportunities to save, notes ASC Retail Consulting, Birmingham, AL, part of ADP's Sandy Group.
Dealers who create work teams and rotate their schedules can extend and fill service hours by 50%, prorating rent, utilities and other expenses over a longer revenue-generating period.
The goal is to sell more hours, be more productive and maintain or reduce current expense levels to capture that elusive 20% net profit from labor.