Customers are the lifeblood of any business, and keeping them coming back is one of the most critical aspects of running a successful enterprise. However, it’s no secret that customer retention is an ongoing challenge for most dealership service departments. According to a recent CDK Global survey, over 70% of car owners stop taking their vehicle to the dealer for post-warranty repair and maintenance. This statistic is significant because it means dealerships are losing the majority of customers during the time period where the biggest ticket repair orders tend to arise.
All of this information reinforces the fact that dealerships must find ways to retain and win back customers in a highly competitive market. In this article, we’ll explore some of the reasons why customers tend to leave once the warranty is up, and ways that dealerships can adjust their strategy to prevent that from happening.
According to a recent CDK Global survey, today’s consumers have hectic schedules, and they often choose their vehicle service based on convenience. Unfortunately, when it comes to convenience, dealerships on average rank lower than both independent shops and service chains. Some of this is based on dealerships covering less geographical area than their repair counterparts. However, that doesn’t mean that dealerships can’t provide other forms of convenience.
For example, dealerships can offer digital scheduling, easy tracking of service progress, shuttles or loaner cars, and upfront quotes on their services to provide a seamless experience to their customers. All of these conveniences can help dealers stand out, creating a stickier customer base.
How does pricing affect retention?
One common misconception is that dealerships need to offer the lowest price to retain and win back customers. Studies show it’s much more important to offer fair and transparent pricing and educate customers on the value of your work, including the fact that you have manufacturer-trained technicians and use OEM parts.
Currently, nearly 60% of service shoppers say they feel dealerships would overcharge them. By offering transparent and fair pricing, and keeping it consistent, you can overcome that misconception and build trust with your customers, encouraging them to stay.
In fact, according to CDK Global’s survey results, 74% of non-dealership service customers would stay at a dealership that fostered trust through convenience and fair pricing.
So how can dealerships foster trust and demonstrate their commitment to fair pricing?
That’s where RepairPal comes in. RepairPal helps dealers build trust by demonstrating to customers that they are fairly priced. When a dealership becomes RepairPal Certified, they are vetted and guaranteed to be priced consistently with other service facilities in their area. Having this third-party verification builds a lot of trust in the consumer’s mind, and makes it more likely they’ll return for repairs and feel like they are getting a fair deal.
Moreover, Certified dealers are encouraged to showcase their certification, and RepairPal helps by providing them with a profile page on RepairPal.com, a widget for their website, as well as signage and print assets to display at their facility. By consistently promoting their RepairPal Certification, dealerships can change the mindset of their customers, improving their retention post warranty and winning back customers who may have left for the reasons mentioned above.
In conclusion, as a dealership service department, it’s essential to focus on convenience, fair pricing, and trust to retain and win back customers. RepairPal can play a crucial role in helping with these areas and driving long-term success.
If you’re not yet RepairPal Certified, click here to get in touch with our team.