How Your Dentist Can Help You Improve Your Service Department

Sep 30, 2012 | | 15250 |

How Your Dentist Can Help You Improve Your Service Department

By Justin Sprague

Originally published in Fixed Ops Magazine July/August 2012 Edition

Dealers frequently ask me how to make more money in their service department. And in a CDK Global survey conducted last year, nearly 30% of our over 2,800 dealer respondents said that increasing Parts and Service revenue was their number one goal and priority.

No surprise. So what do I tell them?

There is a lot going on in the backdrop. Customers—especially the younger ones—perceive that a dealership’s Service department is more expensive. They are way less loyal and more likely to go to independents. And cars on the road are older. J.D. Power and Associates tells us that vehicles that are five years old or newer dropped to 63 million in 2012, a forecasted low for the industry. You know that if customers are keeping their cars longer, warranty work is drying up. So they ask me, how do we get more customer-pay business?

And I always tell them, it comes down to improving your customer’s experience. It really is about the process, the people, the technology.

First, we as an industry need to realize and own up to the fact that the current systems in the Service department can be cumbersome, clunky, and ultimately do not lead to customer retention. Then we need to adopt the technologies out there that can make this whole workflow a lot more streamlined.

When I walk through dealership’s service processes, time and time again, I see that they’re thinking about it in the wrong way. Right now, it’s a series of transactions.

And it’s not just about customer pay, by the way. Hook them now and you’ll have them throughout the cycle. Dealers are finally making money on cars, but NADA tells us it is about $247 per customer’s RO. One dealer told me it is basically a loss leader, that give you an opportunity to sell something that makes money. But you have to hook them early. Are you setting up that first appointment before your new car buyer leaves your site? Do you have an easy way to do that? If you don’t you’re missing out quite a bit.

Another JD Power study says if you offer to schedule the first maintenance, it greatly improves service loyalty. If you get them to come into the dealership for that first service visit – and give them a good experience while they’re there – you get nearly all (about 90%) of their visits after that. If you don’t you only get 25% of their visits. So it’s worth your while.

Think of how your dentist does it—you can’t leave that place without setting up a new appointment. They do it before you pay your bill. Those people follow a tight process to get you to come back in.  They’re not thinking about it like a transaction. They’re thinking in the long-term customer life cycle way. And my dentist is vigilant on email and text reminders. Why? To reduce no-shows. Same rule applies at the dealership.

And what is the appointment setting experience for your customer after that first appointment? Most dealerships (and other businesses) have online appointment scheduling. But it stops there. Think of amazon.com’s model – when you log in, you see your past order history, suggestions for what you might like and it’s just a few clicks to order. They have perfected this workflow. The same principles apply to Service. Why stop at appointment? Give your customers the same transparency. Past denied work. Suggested maintenance. Couple clicks to order. It’s not that difficult but I see dealerships who don’t do this. A lot of dealers use one vendor for their appointment plug-in, and another for the walk-around, and other one for inspections. Are they talking to each other? Does the customer see the same data when they make an appointment as the Service Advisor does when that customer drives in? Probably not.

By the way, you also want to appeal to the younger buyers, who tend to be less loyal. Doesn’t want paper mail. Wants everything done online, at her fingertips.  They grew up using amazon.com. This is what they’re looking for.

It needs to be easy, it needs to be fast, it needs to complete, and they see value in you or someone else keeping track on all this stuff for them and just let them look when they need it.  Ask anybody under the age of 35 and they’ll tell you the same thing. Want to keep these millennials, and have them come back for another car eventually? Do business the way they want to do business.

Let’s move onto writing the ticket. We’ve all seen how busy a Service department can be at 8am in the morning. The line of cars waiting. I’ve seen them churn and burn them – get them in and get them out. No greeting at the car. No walkarounds. Lost opportunity to check past denied work and suggest maintenance.

But there is so much that can be done there. It should be thought of like the Apple store experience. When you walk in, you see the Apple folks standing there, with an iPad, waiting to greet you if you have an appointment. Have you been to an apple store on a Saturday? It’s really the same concept.

Dealer groups are started to get it. You may have seen that they are starting to see traction using tablets in the service drive… it’s working and leading to more dollars per RO.

When you look at the department in the eyes of the customer, often what they see is something that is a hassle, inconvenient and generally a time drain in their day. Just take booking an appointment for example. If a customer calls in to come in for service on their car, there has to be a solid line of communication between members of the Service department. If there is some level of human error or miscommunication, it is the customer who suffers and feels that the dealership they’ve chosen to work with was not worth their time.

All of this communication, according to a study conducted by CDK Global, centers around the Service Advisor. Not keeping this key person informed of scheduling issues, maintenance progress or team cohesion can lead to a Service department that, for lack of better term, is falling apart in the eyes of a customer. So communication tools – IP Telephony, texting – are key to this hub. You need seamless communication to the technician too, with an automated inspection process, that again, sees everything from the past customer interactions and gives you the opportunity to upsell. Otherwise you’re leaving money on the table and not building trust.

Plus, one system integrated into the DMS makes it faster. Less rekeying. Better workflow. No surprises for the customer, which leads to more trust. And you could use that time to sell even more.

So take your cues from the dentist – customer pay, a seamless process and workflow, and a better experience. All of it will make the process – and quite fitting for this example – less painful.

 

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Authors: 
Justin Sprague

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