Last week, Automotive News highlighted Redlands Auto Plaza, a Southern California dealership that is doing some pretty creative things within their service department to increase absorption. General Manager, Loren Campbell, recognized that becoming more efficient within the service department was key to increased profitability and a better customer experience. “Time is the only thing we have to sell. The process is the key: quicker and simpler. That’s what customers want,” Campbell stated in the article. To achieve this, he paired up service advisors to work in teams so that there was always an advisor available to answer questions about any customer’s specific vehicle. Campbell also has the advisors serve as cashiers. This speeds up the process and prevents customers from asking a regular cashier questions that they can’t answer. The dealership changed the physical flow of vehicles by creating incoming and outgoing lanes and has added an appointment board, which, according to Campbell, builds credibility for the appointments in the customer’s eyes. These changes have resulted in an 18 percent increase in service absorption (from 56 to 74 percent). ..
Automotive News recently reported about a New Jersey dealership that has a VIP lounge for some of its customers – akin to the exclusive airline club lounges – in which customers can wait for their vehicles in service. The lounge offers fresh fruit, cappuccinos and has high-definition big screen TVs. Customers need an access code to gain entry. Their service vehicles have their gas tanks topped off, their cars are hand-washed and their vehicles are returned to them complete with “handwritten thank you notes and Godiva cookies.” You might think this sounds like a scene that would take place in a Mercedes or Porsche dealership but it’s actually happening in a dealership of a brand you probably wouldn’t expect… Hyundai. ..
Last week, Wired magazine featured an article describing Audi’s ambitious plans for robots in local dealerships. A remote technician at Audi headquarters controls the “Audi Robotic Telepresence” robot. According to Wired magazine Audi claims that “the robot mechanic will improve speed and accuracy of service and create an improved ownership experience for the customer.” The robot can roam around your service bay independently and view and chat with technicians. Audi is apparently testing them at 18 dealerships and plans to install them at 100 dealerships across the country. ..
One of the pain points I frequently hear from dealers is how to acquire frontline pre-owned vehicles for their stores. Having an available solid inventory of used vehicles for customers is imperative. Not everyone will be able to (or even want to) buy a new vehicle. To run smoothly and continuously generate revenue, dealers must continuously acquire vehicles. This provides available alternatives if a customer chooses to switch from new to used. In addition, the front-end gross profit potential from a used vehicle is typically higher than that of a new vehicle. However, competition to acquire these units can be very heavy at physical and online auctions. And dealers frequently fail to purchase as many as they would like because of inflated bidding. Once transportation and reconditioning costs are integrated, used car managers can be forced to pass on some pretty desirable units for their stores. Due to these challenges, dealers are having to be more creative in finding this inventory. ..
In case you weren’t aware, this week is Automotive Service Professionals week. Established in 2001 by the National Institute for Automotive Service Excellence (ASE), this week celebrates all of the men and women who have chosen automotive repair as their profession. Automotive Service Professionals week offers a great opportunity to recognize your service department technicians. Many dealerships use spiff money for rewards. Money is certainly something most need and want. However, according to a recent article by Psychology Today, a new study of 1,200 U.S. employees, from a broad cross-section of industries, found that money is not as high on the list as some might think. 70% of employees responded that their most meaningful recognition ‘had no dollar value.’ The study was conducted by Make Their Day, an employee motivation firm, and Badgeville, a company that uses game thinking and game mechanics in non-game contexts to engage users in solving problems. ..
Every day automotive manufacturers announce new technology they plan to introduce into their vehicles. Tuesday, Volvo announced that their XC90 will not only tell the driver when it’s time to visit the garage, but also suggest an appointment at their Volvo dealership. Service notifications within a vehicle are far from new. At it’s very basic; a check engine light is simply a service notification. Through the years there has been a progression in the sophistication of these reminders. They have grown from simple text reminders, to the more sophisticated On-Star reports that are e-mailed to the customer while also notifying the dealer. The system Volvo has named “The Connected Service Booking” application is unique in that it is the first of its kind to take service reminders to the next level. It enables the vehicle owner to recognize that their vehicle needs service. And it also makes the process of scheduling a service appointment convenient as it is built into the vehicle’s computer system. In so doing, Volvo has shown the value that technology and connected cars bring to dealership service departments. ..
In our modern world of technology and instant information, consumers are increasingly seeking answers to their questions online rather than asking a business for it. One way that consumers are doing this is through video content they find online. Video content provides many benefits for consumers as well as businesses. In the automotive industry, there are many companies that laud the benefits of video marketing of inventory. Why? Because it works. Consumers who are in market for a vehicle, especially a pre-owned vehicle, get a much better idea of the vehicle’s condition and features through live video walk-arounds than through the few staged photos that many dealerships offer on their website. The same principle applies to your service department. ..
A recent Automotive News article covered the decrease in trained automotive service technicians graduating from vocational schools. Not only are the vocational schools producing fewer graduates in the automotive repair field, but the training they receive is dated. Many vocational schools cannot afford the high tech equipment that today’s modern vehicles demand. This results in students that are ill equipped to smoothly transition from school to a career as a technician. Additionally, according to the article, some OEM training programs also “aren’t providing enough updated, hands-on training.” ..
A recently released white paper based on a collaborative study between Cars.com and GFK, reported that consumers are leaving dealership service in favor of independents due to a lack of trust and price transparency. The lack of price transparency in parts and service are cited as key reasons that consumer perception leans towards independent automotive service providers. According to the white paper study, these can be overcome through better digital marketing. The white paper suggests that dealers should put a greater focus on increasing the digital presence of their parts and service departments and also promote their superior technicians and parts and labor warranties. ..
The recently released J.D. Power 2014 U.S. Customer Service Index Study produced some interesting, and very promising, results. The report concluded that customer satisfaction with dealer service has increased across the board with overall CSI increasing from an average score of 846 to 855 in luxury brands, and from 789 to 797 in mass-market brands. The study noted some especially impactful trends when it came to customers that have complimentary or prepaid maintenance programs. In mass-market brands, where complimentary maintenance programs are less common, the study found that buyers of prepaid maintenance jumped from 15% to 46% over the past 5 years. ..