Customers are leaking out of dealerships, costing millions in lost revenue.
The parts and service side of dealerships represents US$4.8m (NZ$7.1m) in revenue for the average United States dealership
For each dollar service revenue, roughly, a dealership gets a dollar of bottom-line profit.
There’s a problem with the seemingly golden flow of cash – only 54%of customers buying or leasing a car in the US return to the same dealership for servicing.
Vennli, visualisation and analytics specialist, recently surveyed 516 car owners over service habits.
Only 36% of surveyed owners went to a dealership for regular maintenance and 22% for oil changes.
However, 91% who get oil changes at a dealership also get service done there.
The most important drivers of customer choice were quality of service, explanation of service, trust in the recommendations, expertise with make and model, speed of service, low price and comprehensive 1-stop service.
It was less important for car owners to be able to schedule online, personally know the mechanic, have the car cleaned before it was returned or experience a great waiting area, even though these represent common improvements dealerships make when trying to grow their services.
Independent service centres were perceived as cheaper, but customers saw value in specific expertise of mechanics, comprehensive inspection and use of genuine or manufacturer-recommended parts.
Customers who habitually used dealerships for servicing perceived them to be more convenient, have a higher quality of service; but independent service centres’ customers believed exactly the same thing.
Vennli suggests dealerships reconsider less-important items – particularly expensive alterations to waiting rooms – and focus on the the things that actually influence customer behavior.
The most valuable customers want super-quick service or the option to drop the vehicle off. Customers that leave their vehicles spend $3 to sit-and-wait customers.
Vennli’s research shows that those waiting want to get out as quickly as possible – so will turn down additional services.
People who leave their car and return for service spend an estimated $3 on service for every $1 spent by a person who waits.
Customers who wait want to get out as soon as possible and will turn down additional services.
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