The automotive industry is going through rapid change, facing additional costs associated with personnel, benefits, and retention, and depending on a steady stream of additional customers to replace those customers that have defected. So how do you change how you conduct business to meet the current challenge? - IMAGE: 3alexd via GettyImages.com

The automotive industry is going through rapid change, facing additional costs associated with personnel, benefits, and retention, and depending on a steady stream of additional customers to replace those customers that have defected. So how do you change how you conduct business to meet the current challenge?

IMAGE: 3alexd via GettyImages.com

What’s the difference between the average dealership or repair facility during this current state of our country and say, ride-sharing services, like Uber and Lyft?

I’ll give you a minute to ponder that question. However, believe it or not, there are many similarities between the two industries.

Both industries are going through rapid change. Both are facing additional costs associated with personnel, benefits, and retention — personnel and customers. Both are dependent on a steady stream of additional customers to replace those customers that have defected. Both industries are being asked to change how they do business to meet the current challenge. 

Give up?

Nothing is different.

That’s right. The same conditions are plaguing both industries.

Easy to see the correlation now, isn’t it?

The virus is not our fault. It’s a worldwide problem. What is our fault is the way we’ve been doing business for some time, before the COVID-19 outbreak. 

We became survey hounds consumed by the pursuit of scores. We were concerned about issues only when it affected the dollars coming in, provided training to our personnel only when absolutely necessary, and when there were no other cheaper alternatives, constantly and consistently changed employees pay plans and benefits. We waited for our problems to be solved by technology, and over the past few years, happily existed in a world of our own making.

But, as the saying goes: “The chickens have come home to roost, Bobby Boucher.”

We are facing a crisis that demands change, and we cannot correct it doing the same old things. Let me give you an example. Most dealerships have attacked the current issues by changing the following: new hours, mining the recall lists, offering pickup and delivery, providing a vehicle cleaning service, prospecting from the SOP bin, changing pay plans and benefits, and laying off personnel.

When we finally get back to normal (if there ever will be a normal), we will need to immediately re-energize the customer base because — guess what — they realized they didn’t need us all that much.

Oh sure, recalls and goodwill are important, but will it be enough to get John Q. Public back into the dealership’s doors for regular service and maintenance? If you are counting on that to happen organically, I challenge you to start thinking differently.

Some dealers will throw money at customers, chase customer retention instead of building customer retention, keep reducing costs (by any means necessary), put training on the back burner, and expect technology to come to the rescue.

Here’s a little secret about technology: It does not work with untrained people.

So, if you’ve been waiting and looking around for help, and are expecting technology to save you, you might be disappointed with the results. It’s takes a trained professional using the latest technology to overcome this challenge in our industry. You can’t do it with just one of those things, you need both.

First, your dealer clients need to train the service sales team. Many of you have grown up in the car business and have been around many service departments and many service personnel. I dare say, if  personnel have been around awhile, you would think they would have had some training or instruction along the way.

Not the case.

I will bet everyone reading this, that I can go into any dealership in North America (or the world for that matter), and find an advisor or manager that has been in the business for years and years, and has never been trained, other than “Here is your phone, here is your desk, don’t mess it up.”

What does that make them?

It makes them survivors.

They escaped being eaten alive by this business, albeit, many of them are covered in “scars” from customer and management encounters over the years. But it doesn’t make them good advisors and managers, and years of the same experiences only keep them in the same crab bucket they started in.

You know about crab buckets, right?

Put a bunch of crabs in a bucket and you get crab mentality. Nobody gets out and they all suffer the same consequences. Much like the mentality permeating our industry today. We need to stop the crab mentality — get people out of the bucket and into a training program — or we are doomed like those crustaceans going to the boiling pot. That’s why you need to train continuously. 

Second, you need technology that makes sense, works right, and is easy to use. 

Take software. There are lots of software solutions out there and you can narrow down your choices by using three simple questions.

  1. Does the software help advisors sell and service more customers, and is it easy to learn and implement for the dealership team and customers? 
  2. Does the software help increase engagement, provide transparency and build relationships?
  3. Does the software help make a profit?

These three simple questions will guide you and narrow down the choices. Then it becomes a matter of selecting the one that is right for you. Keep in mind that the best choice might not always be the most obvious choice.

Not only should it be friendly to the customer (and the advisor), it needs to be robust, feature-rich, upgradeable, easy to make changes based on dealership preferences, provide reliable and instantaneous communications, and be accessible from any device, anywhere.

Why do we need it today?

Here are some recent survey results from different sources. AAA says that two out of three drivers don’t necessarily trust repair shops. According to DEM Automotive, dealers lose between 60-78% of revenue on cars that are three to six years old and approximately 80-92% on cars more than seven years old.

What will this same survey look like six months after the virus has been corralled and the industry has started to return to “normal”?

This is nothing new to many of you reading this article. We’ve been fighting the customer attrition problem for a long time.

But do you know what has not changed?

The experience we provide our customers.

Our customers are telling us we need to do something different. The industry is being turned upside-down by disruptors. Traditional sales and service methods are being washed away in favor of the convenience, speed, value, transparency, and trust model, and that requires us to change.

People make up our business, and they are telling us that the way we do business is not the way the they want it. They can choose their level of service and experience with the push of a few buttons.

Want a bigger rental car? Click.

Want a large instead of a small? Click.

Want to upgrade your hotel room? Click.

Want more legroom?

Click … Click … Click.

Options are what make the experience better, people are what makes the experience memorable. Give your customer options, train your personnel so well that they become the standard by which others emulate, provide your personnel with the tools necessary to engage and enhance the customer, and then get out of the way.

If you have not considered a training program for your advisors and fixed operations personnel and combined it with a communications and service sales software tool to change how you interact with your customers, then you might be part of the new dealership extinction event that’s coming to a town near you.

Leonard Buccholz is a trainer, consultant and lifetime learner. He has been a professional workshop and seminar facilitator with success as a leadership, sales process, communications and fixed operations coach.

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