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Chris Miller

Chris Miller CEO & Co-Founder

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Recalls: A Great Profit Opportunity for your Dealership

 

While recalls have in the past caused great adversity, they can in fact be turned into a great opportunity -- if your dealership gears up and correctly handles the traffic.

According to CARFAX’s new annual research, more than 46 million cars nationwide have at least one safety recall that’s never been fixed. That’s a tremendous amount of opportunity – and not just for service revenue, but for vehicle sales as well.

In effect, the OEM is delivering sales and service prospects to your door. In many cases, these are customers that have not been in for quite some time, or new customers you have never seen before. It provides your dealership with an opportunity to inspect the customer’s car at no cost to the customer. This frequently leads to more repair business, and, in more cases than you may think -- a vehicle sale.  In fact, GM stated last year that it sold 6,600 cars to customers who traded in vehicles with defective ignition switches.

The danger comes if you fail to give good service, or if parts are not obtained in a timely manner. So, it is key to be prepared to do a really good job of servicing these customers. Here’s a great opportunity to wow a customer with the level of your service. If the customer is very concerned about a recall, put them in a loaner that very moment until their car is repaired. In some cases the cost of the loaner is even covered by your OEM.

A point to consider however, is that while 46 million cars with an open recall represents a lot of opportunity – the sheer volume also means that many of these consumers could be suffering from “recall fatigue.” They may have seen so many recall notices that they no longer pay attention to any of these OEM messages.

So, it is time to get creative in your marketing to capture the attention of the many consumers with open recalls in your marketplace. Develop a marketing strategy to reach out and contact these customers -- there is certainly a lot of gold out there to be mined.

Approach a recall as an opportunity and plan accordingly … they can be a great opportunity to establish new customer relationships and increase revenue.1cdef85295231c7bc7bc4e383e2f084f.jpg?t=1

Denim Simkins
Chris you are right I think "most" consumers might be a little blind to the open recalls due to the sheer volume of them lately. Even so this still is a great source of revenue for service and parts. It is also a prime opportunity for you to have a vehicle in for service that you might not have seen for quite sometime. However, I see too many times where service staff does not see this as an opportunity.
Chris Miller
Hi Denim, thank you so much for your comment. Believe it or not I spend my Friday nights listening to inbound phone calls to dealerships and, at times, it pains me to hear the way these customers are treated. Recalled vehicle owners are an opportunity to present both the OEM and the dealership in a favorable manner. And turn what could be a negative into a tremendously positive experience for the consumer to make them a customer for life, upsell additional service revenue, and eventually get them into a new vehicle. Indeed, in recent months we've learned that the best service we can provide to a dealership, beyond the recall data and campaigns, is actually TRAINING on how to handle consumers. Starting with a simple apology to own the recall problems has a great impact in setting the tone for the rest of the call as the dealers settle into an advisory role for the consumers and eventually are able to create lifelong relationships.

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