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Is RedCap the Answer to Increased Service Revenue & Customer Satisfaction?

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A recent article in Automotive News highlighted a start-up seeking to help dealers offer loaner cars and delivery/pick-up services without the additional expense of staff. RedCap Automotive Technology is a concierge service that provides drivers in Uber-like fashion to dealers. Dealers who utilize RedCap’s concierge service are able to contact RedCap when a customer needs service. RedCap then arrives at the dealership, picks up the loaner car, takes it to the customer and returns to the dealership with the customer’s vehicle. When the service is completed, RedCap then returns the customer’s vehicle to the customer and brings the loaner car back to the dealership.

 

According to the article, dealers get more efficient use of their loaner car fleet as vehicles are returned faster because they no longer have to wait for a customer to finish their work day to return the loaner. In addition, it solves a major customer pain point of lack of time to bring in their vehicle. It also eliminates the need for the customer to wait. Automotive News reports that dealers using the service have experienced an increase in service revenue since customers are more likely to accept service recommendations over the phone, knowing that if they accept, they won’t be stuck waiting in the service lounge for an unknown period of time. Some dealers are even exploring ways to offset the service costs by selling it as a product through the F&I office.

 

Any time dealers can make it more convenient for a customer to get their vehicle serviced, they will see increased revenue and customer satisfaction. Another additional benefit I see is that it makes it easier for dealerships to schedule larger repairs and recall work at times that are convenient to the dealer. One of the biggest problems with the massive amount of recall work is availability of parts. And, once those parts arrive, the dealer must then track down a customer and schedule them to come in and get the recall work done -- which could be a week or more, depending upon the customer’s schedule. Dealers could use RedCap as a means to decrease the time between parts arrival and recall work completion. Now they can reach out to a customer and offer this delivery/pickup service at the dealership’s convenience. Since the customer experiences less disruption in their schedule, chances are pretty good that they will be more amenable to working on the dealership’s schedule, rather than finding a day and time that fits their schedule.

 

While RedCap is currently operating with just 50 retailers, it does plan to expand into several thousand stores in 2016. It’s certainly a valuable service for dealers to consider, and could be a great way to provide a better customer experience. It should certainly lead to greater customer flexibility as far as scheduling. It could also help decrease the lag time between parts availability and recall work completion. That’s a win-win for the customer, the dealer, and even the OEM!

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