CEO / Founder Ujj Nath explains why the auto industry needs to be prepared for the rise of electric vehicles.

myKaarma CEO / Founder Ujj Nath explains what makes great brands great in this video blog.

In a recent  article Colin Shaw, a leading customer experience thought leader and author, details his car-buying experience – and not in a positive way. He experienced car-buying the same way that car dealers have always done it in the past. Spoiler Alert! -- The title of the article is “Unbelievable! Does Car Buying HAVE to Be SO Bad?” 

What are the long term service ramifications of this “BAD” sales process? 

Answer: Limited or NO loyalty for your service business! 

Dealerships currently average only 33% retention of car buyers into the service department. Those customers angered by the sales process frequently decide to drop the dealership from consideration when it comes to servicing their vehicle.  

I am sure you all know how important service revenue is the overall financial health of your dealership. Well, when you start the relationship with a bad experience the ripple effect can be extremely costly. Lost opportunity costs include: 

•  Multiple years of service work revenue 
•  Up to 80% decrease in the opportunity to sell that customer another vehicle 
•  Lost referrals they could have given 

And let’s not forget how much time, effort, and money you spend trying to win them back for service and sales opportunities. In total this can add up to thousands, or even tens of thousands of dollars of lost revenue per customer that abandons your dealership due to a bad sales experience. 

The key to growing your business is to keep your customers and have them refer other customers.  That is why the hugely popular customer service score NPS (Net Promoter Score) asks one question only - ““How likely are you to recommend this business to a friend or colleague?” 

A few simple things can make a big jump in loyalty gains: 

    1. Honor agreed upon prices and avoid the “Today Only” mindset. 

    2. Simplify the foursquare process as much as possible and set a time limit for negotiations. 

    3. Focus on the “lifetime value” of customer during the sales process. 

Sticking to old processes and singing that “same old song” which doesn’t apply to current generations will send your customers out the door to your competitors. Be open to new ideas. Change is not your enemy. Dealerships that adopt new technology, realize the need to focus on the customer experience, retention and loyalty, are already leading the pack into the future. Do yourself a favor and jump on board! 

In every company, at some point in time, customer service mistakes happen. And, they are often magnified by the fact that the customer-facing employee cannot handle the situation on the spot. The upset customer is kept waiting while the employee checks with management, or worse, the customer leaves disgruntled!  
 
Well, rather than have an irritated customer on their hands, many companies now empower their front-line employees to defuse situations and make decisions on their own to quickly handle the upset customer. For example, the Ritz-Carlton hotel chain empowers its employees to fix problems by allowing each employee a discretionary budget of $2,000 per guest per day. That may sound like a lot – and it is – but the hotel chain trusts its employees to make the customer happy without going overboard. This discretionary fund allows employees to fix problems instantly, immediately returning the customer to a great experience and, perhaps, even further impressing and building loyalty.  
 
Today, in our highly competitive automotive industry, it’s all about the customer experience. How about empowering your employees in the same manner? I’m certainly not suggesting that you give your employees $2,000 worth of discretionary budget. But what about $50 to fix a mistake, or right an inconvenience? It costs a heck of a lot more than $50 to acquire a new customer, should you lose one due to some upset that was left unhandled. 
 
Consider starting a “Customer Love” program at your dealership. Every time a customer is inconvenienced, do something small for them to show that you care. Train your employees in the best way to do this and then trust that they won’t abuse this system. You’ll find that they don’t. In fact, the employees will feel more engaged and less helpless when confronted with an upset customer. In the end, everybody wins! 
 
In no way should this program supplant top-notch service. It is simply another tool to make your service better should a process fail, or a mistake happen that negatively impacts one or more customers. Customers will appreciate the gesture and most will forgive the mistake. Rather than leaving the dealership upset, they will leave with a positive perception of their visit, despite any inconvenience.  
 
It’s great to always aim for “Wow!” But, when you fail, as long as the customer believes you’re genuinely sorry, and is shown that through an apology and a token gesture – perhaps a free oil change, a refund for service they just received, or a complimentary detail – the customer will more often than not forgive.  
 
You won’t always execute perfectly -- but when you don’t, you simply need to be willing to show your customers some love and say you’re sorry in a meaningful way.

myKaarma Founder & CEO Ujj Nath explains the importance of genuine systematic follow up for dealerships.

Founder / CEO Ujj Nath shares 5 ways that dealership service departments can increase their market share on repairs in this video blog.

Convenience is one of the biggest factors that influences customers when choosing where to take their vehicles for service. For the younger generation it even trumps price. Independents know this and it is one of their key marketing messages, along with speed of service.

Dealers tend to fall behind in this type of messaging in general and have to fight consumer perception that service from a franchised dealership is inconvenient, expensive and takes too long. Today’s consumers don’t want to have to drive to a dealership, drop their car off and return later – especially when there is a Jiffy Lube around the corner from their workplace that promises 30-minute oil changes.

How can dealerships alter that perception and make their service departments more attractive to consumers?

Well, I have seen several dealers kill it in their marketplace with remote delivery and pickup for service customers. It is a highly successful action and, I promise you, is well worth looking into.

With a remote pickup and delivery service you can easily trump any independent, as well as other dealers in your market. Consumers would prefer to have you pick up their vehicle from their home or workplace and return it upon completion of service, rather than drive to a location -- even around the corner to Jiffy Lube. This is the future of automotive service and customer experience.

And, let’s take this concept one step further. What about when autonomous cars proliferate the roads? It wouldn’t surprise me if, in the not-too-distant future, a consumer can simply push a button and the vehicle drives itself to the dealership, returning on its own when service is completed – just like a Roomba – but on a much larger scale.

But until technology develops to that point, the next best thing for a consumer is to have a convenient way to get their vehicle serviced with as little friction or effort as possible. If you offer your customers this level of service, along with the latest technology such as photos and videos of what needs fixing to help improve the customer’s understanding, you will find that, as a result, you have more opportunities to fix the car right the first time. In addition, by placing the consumer in a relaxed state of mind, enjoying the convenience of your service, they are also that much more likely to trust you and accept your recommendations.

According to a US Federal Reserve study, car sales fell 60% for the age group 16-34 from 2000 to 2016. Add to that the fact that a franchised dealer only sees one out of every three repairs, and it may be time to stop building mansions equipped with movie theaters and Starbucks and instead focus on implementing remote delivery and pickup services, along with satellite repair facilities. If you don't increase your repair penetration, with car sales decreasing, eventually fixed operations will get impacted.

Showing your customers that you value their time is the single biggest differentiator today. If you show appreciation and your customers find that your dealership accommodates all their needs, customers will start choosing you over independents and the competition down the road. Your dealership will become the customer’s one and only place for all their vehicle needs. .

Survey:

Does your dealership offer remote pickup and delivery services?

1.    Yes

2.    No

While many companies have entered the retail automotive space trying to capitalize on the experience customers want but are not getting from dealers, the biggest threat is actually looming on the horizon: The Tesla Model 3.

Until now, Tesla has bucked the system while pushing its direct-to-consumer sales model. However, their past vehicles were limited in quantity and priced too high for most Americans. Well now, the Tesla Model 3 with its $35,000 price range poses a direct challenge to many automakers.

Tesla has literally smashed all industry pre-order records with $1,000 deposits from a staggering 600,000 customers -- that’s $600 million in deposits from customers who haven’t even seen the vehicle, let alone given it a test drive!

When the Model 3 hits the streets – should consumers fall in love, which seems like a given at this point -- the auto industry will have to fight back – and fast. Everything will have to change – sales models, service departments, the customer experience… you name it -- will need to change.

Think about this:

Tesla is a software platform that has wheels. While American cars are wheels that have software.

Customers will now KNOW – on a mass scale – that buying a car completely online is very possible, not simply a pipe dream delivered by a handful of automotive companies. In fact, Hyundai has already realized this and now offers its highline model, the Genesis, to Canadian customers purely as an online purchase.

Customers will EXPERIENCE – on a mass scale – that they no longer have to visit a dealership for vehicle service. Almost all of Tesla’s components can be tweaked with over-the-air software updates.

Customers will UNDERSTAND – on a mass scale – that electric vehicles are practical and can save them money on fuel costs. It’s estimated that if a consumer drives 15,000 miles per year in a Tesla Model 3, they will only spend $602 on fuel for the ENTIRE YEAR.

Once consumers understand all the benefits of the vehicle, the experience and the entire Tesla process, dealers who haven’t adjusted to provide a similar experience will risk going kaput. And those that don’t understand the necessity of building customer loyalty NOW, will go kaput the fastest.

If we as industry fail to counteract Tesla’s moves now, Tesla will simply keep chugging ahead until, one day, dealers will no longer see Tesla in the rearview mirror but, rather, will watch their taillights as they pull further ahead.

Survey:

Do you think the Tesla Model 3 will have a major impact on the auto industry?

1. Yes

2. No

myKaarma CEO/Chairman Ujj Nath shares an unconventional idea on how to increase customer pay ROs in your service drive.

In this video blog, Ujj Nath explores the text messaging solution for dealerships and asks whether a texting solution is adequate by itself.