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.

It’s the goal of every service department to enjoy excellent customer retention and loyalty. Other than tempting them with coupons and incentives, what can you do to keep bringing those customers back in? 

Here are 5 things I have seen successful service departments do over the years that bring their customers back for service: 

1. Assign Each Customer a Service Advisor – By assigning each customer their own service advisor you have a better chance to build rapport and trust. The sales department assigns a customer to a salesperson for this exact reason, so why wouldn’t the same philosophy apply to service? This practice allows customers and service advisors to build a relationship which then extends to the dealership. When customers deal with the same person for each service visit, they no longer have to explain past repairs to the service advisor, have more familiarity and are more at ease with the entire service process. 

2. Notify Customers of ETA Changes in Real-Time – There’s nothing more frustrating to a customer than planning their day around a repair based on the estimated time their vehicle is supposed to be ready, then an hour or two later, when they expect the service to be done, they find out it’s going to be MUCH longer. Text, email or call your customer (depending on their preference) with regular vehicle status updates. If Domino’s Pizza can do this, why not your service department? Real-time notifications keep customers informed and lessen the chances that they will be irritated and will lower the # of inbound phone calls to your service department. 

3. Provide Direct Lines to Service Advisors – Nobody likes phone trees when calling into any business. Especially if it makes it difficult to talk to a live person. Lessen friction by simply giving direct phone numbers to the customer for their assigned service advisor. Customers will no longer be upset by being unable to reach a live person; the service advisor they speak to will be familiar to them; and the customers should get their questions answered faster. This makes for a better customer experience and more efficient service department. 

4. Allow Customers to Review Invoices in Advance – Being surprised by a bill larger than expected is not something most people react well to. If you can email or text the final invoice to the customer, they can then review and approve it -- and with today’s technology even pay the invoice before coming into the dealership. This also gives the customer the opportunity to ask any questions up front and removes the possibility of confrontation and aggravation at the dealership. 

5. Follow Up After Service – Of course, for a customer to feel special and cared about, they shouldn’t be forgotten once they leave. A simple call by their assigned service advisor to verify they are happy with the service they received, to check if they have any questions and to inform the customer that they look forward to their next visit, makes a far greater impact than most people realize. In addition, it allows the service advisor to hear, address and correct any problems before the customer either fills out a survey or decides to go somewhere else. 

Consider copying these best practices from other successful service departments. As a result you should enjoy happier customers, less friction, increased customer retention and profitability.

While the automotive industry has seen massive technology changes in the last 5 years, there is a continuing trend where some OEMs partner with specific vendors and then take away the freedom of choice for forward-thinking dealers. Mandates are enforced where franchised dealers must choose between 2-3 vendors for a particular solution.

This practice can be very frustrating for dealers – especially any that specifically wish to think outside-the-box, be innovative and try new things. I have heard of some dealers that have vendors they are forced to use as a packaged deal with multiple solutions, some of which they don’t wish to use. There are even dealers that pay twice. Once for the vendor solution they are forced to use, and once for another solution which they prefer for their individual dealership. This ties up their budgets and effectively handcuffs dealers to vendors, preventing them from trying new solutions.

In my opinion, things would work better if manufacturers would allow dealers to choose which solutions are the best fit within their marketplace and audience. I would rather OEMs set up benchmarks that need to be achieved with very simple measures, but with high standards.

Here’s a simple yet radical thought - get rid of the 15 questions you ask every customer in your surveys. How about just focusing on the Net Promoter Score (NPS) for the dealership? Set the bar high and ask one question, “Would you recommend the dealership to your friend or colleague based on your service experience?” I guarantee this would work better than the current situation where OEMs choose solutions which target different actions such as web-based appointments. Instead the focus should be on the NPS score.

This would avoid the “one solution fits all” model for dealers, and would allow forward-thinking dealers to customize their approaches. A case in point, every manufacturer is going after tablets in the lane. Well, I know of a franchise in Santa Monica where on Fridays a car rolls in every 2-3 minutes and they only have space for 6 cars in 2 lanes. They simply cannot check people in using a tablet and allow the customer stay in the car while that is happening. Instead, they have to use porters to whisk the car away and then walk the customer over to their office to check them in. If you jam this dealer with a tablet, and if it does not keep the cadence of a 1-2 minute check-in per car, you are going to create a backup on the already jammed streets of Santa Monica.

Technology changes so quickly that an impenetrable partnership which forces dealers to use one vendor over another can restrict progress, growth and sales. Freedom of choice and outside-the-box thinking is what fosters innovation and then true game-changing can begin.

What do you think, should dealers be given more autonomy to choose their own vendors?

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.

Ujj Nath shares 3 things that dealers should pay attention to in order to ensure a successful future.

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

Some dealership personnel tend to do things that really boil down to just CYA stuff. A customer comes into the service drive and is made to wait while their vehicle is inspected for scratches, dents or dings, which can take a few minutes --- time a customer doesn’t have.

The most valuable currency on the planet is time. Everyone has too much to do with too little time. That’s why customers don’t want to come to get their vehicles serviced. What if you decreased the amount of time a customer had to wait for their car to be serviced? Even if you simply reduce the time in that check-in process, that initial impression of “fast” contributes to the overall customer experience.

Service advisors walk around the customer’s vehicle with an iPad, take pictures and notes to document vehicle condition while the customer stands there with arms crossed waiting impatiently. The longer a service advisor takes, the more a customer feels as if the dealer doesn’t trust them which, due to the general misconception of the industry by many consumers, contributes to the customer losing trust in the dealer. So what are you, as a dealer to do?

I get that it’s important to document any pre-existing vehicle damage. However, there are more efficient ways to do it – both technology and process-wise – than making the customer stand there for several minutes while the initial inspection takes place. Many luxury car manufacturers never make a customer wait because they want to provide an exceptional customer experience at every interaction. They recognize that the customer’s time is valuable, realize that building trust is a two-way street, and don’t want to plant any seeds of mistrust.

Take a page out of the customer service book used by leaders in the hospitality industry -- chains that offer superior service such as the Ritz-Carlton. They train their staff to put customer experience above and beyond everything. In the case of the Ritz-Carlton, each employee has the freedom to fix any guest issue to the tune of $2,000 per day per guest. And at the Mandarin hotel chain, if you ask a bellhop what distinguishes them, they will answer, “The answer is yes, what is the question?” This type of philosophy gives customers the confidence and experience that makes them want to stay and keep coming back.

Don’t use your customer’s time to optimize your operations at the dealership. It’s not yours and never will be. Optimize your operations and procedures to make it a great experience for each and every customer. Respect their time and make it as convenient and time-efficient as possible for them to do business with you. If you do, you will see them keep coming back.

Survey Question:

How long does it take your service advisors to do an initial inspection?

A) 2 minutes to 5 minutes

B)  5 minutes to 10 minutes

C)  I don’t know.

According to a recent article in AutoRemarketing, a study by J.D. Power found that customers are overwhelmingly more loyal, and will return for service, to dealerships that communicate with them well and take the lead in the communication process.

The study found both phone contact and texting increased customer loyalty. Among customers who are contacted by phone, 55 percent say they “definitely will” return for paid service. When receiving text message updates, that loyalty factor jumped to 67 percent.

Customers simply want to know what’s going on with their vehicle – not after the fact but during the whole process. And they want the dealer to stay in communication with them throughout the service process. Service advisors are busy people and, unless your dealership employs a full time staff member to continuously attempt to contact customers with status updates over the phone, you’ll probably find it tough to accomplish.

For the most part, dealerships stick to the form of communication that they’re used to – telephone. While telephones certainly play a part in the communication chain, texting and e-mail can also be effective ways to reach customers. In fact, I have found that a combination of communication methods is the most effective.

It’s tough to get a $500 repair order approved via text, as explaining the value of the recommendations to the customer is typically necessary, which is almost impossible via text.

You can, however, relay simple status updates regularly and/or ask simple questions via text.

And, as the J.D. Power study results show, by utilizing all forms of communication, you can improve customer loyalty, which means happier customers and more service revenue.

You want that, right?

Survey Question:

Do you use texting at your dealership?

1.    Yes

2.    No