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Guest blog: Used cars are the new “new” part two

car purchase

In part two of this guest blog, Chris Ford - business development director at loyalty services company Grass Roots, talks about how dealers should replicate the new car experience for used car customers in order to have a successful used car operation.

Part one of the blog can be viewed here.

The scary bit

Finances and payments - the part of the process where the customer satisfaction is traditionally at its lowest and staff find the hardest to deal with. Staff need to be aware of this and use it as an opportunity to make the customer feel comfortable and looked after – this will maintain a positive brand experience while also making a traditionally scary process seem painless – win, win on all sides – happy and comfortable customer, confident and caring employee.

Picking up the keys

Think of the ‘eBay effect’ i.e. one has a much better perception from receiving a product that has the original packaging, paperwork and manuals etc. – it feels more cared for and thus carries a higher perceived value. This is the same for a vehicle. A good programme will maintain these ‘garnishes’ or be able to recreate /re-order them from the CRM system.

These days, leading manufacturers are starting to capitalise on the feel good factor when driving away by producing welcome packs – even for used cars. The welcome pack can take many forms from glossy brochures and letters, to USB keys with online information about your car, or at best a driver’s club membership, entitling the owner to privileges and experiences to engender loyalty from an early point. Remember a retuning customer doesn’t always have a problem and someone who engages regularly online for personalised, relevant and timely information can become an enormous fan.

Manufacturers have not done enough in this area to capitalise on the feel good factor and high advocacy that owners experience shortly after purchase. In fact this level of satisfaction and excitement often falls away after the first month or so, therefore brands need to do more than just handover the keys and wave.

Are you being served?

Something that is generally carried out by leading manufacturers is the after-sales survey, but not everyone does them well. There is nothing worse than sending a survey asking for feedback and then doing nothing with that feedback whether positive or negative - be prepared to take action!

Asking for feedback, getting below average scores and then carrying out no follow-up with the customer to investigate or resolve issues, points to a poor customer experience that can lead to lower satisfaction than before the survey was carried out. A good customer satisfaction programme should provide dealerships with clear access to results that incorporate a flagging system (red, amber, green) to highlight areas that need urgent attention - and in positive cases, recognise an employee’s actions - and a process for follow ups.

Measuring customer satisfaction, along with mystery shopping, allows brands to keep a clear view on what’s going on in their channel and identify improvements where appropriate, through the whole process; pre, during and after sales.

After the honeymoon period

In the majority of cases, a month or so after purchase customers don’t really hear from the dealership, as salesmen focus on the next sale. However through the use of email communications and owners’ club style packages, brands can maintain a close relationship with their customers in between services, increasing loyalty and the likelihood of repeat purchase a couple of years later. A good CRM system will manage customer lifecycle communication from prospect to purchaser and automatically update with relevant information on an on-going, personalised and timely basis.

Brands have a tendency to divide ownership into ‘New’ and ‘Used’. Leading manufacturers are starting to recognise the need to treat all customers with the same care and attention. Remember the 22 year old spending £7,000 – he could be your 35 year old willing to spend a whole heap more in years to come. Some communications may need to be adjusted to personalise them, but essentially customers should all feel part of the same club.

On-going communication and official owners’ club schemes can boost loyalty; incentivising and rewarding customers for continuing to transact with dealerships and the brand - for example, discounts and rewards for carrying out services with approved establishments, and buying official parts, rather than charging premiums for choosing your dealership to carry out work.

Maintaining servicing levels within the dealership is even more important, as consumers are keeping their cars longer, therefore this is a revenue stream that needs to make up for the potential shortfall in sales. It is acknowledged that, on average a person will visit their dealership twice in any given year for servicing and repairs - spending around £200 per visit. We know that the margins on service work can be considerably more than the margins on buying a car in the first place. So why then wouldn’t the service experience be as special?

Conclusion

Grass Roots has found that the car marques that tick all these boxes and join up these services end-to-end gain considerable synergies and efficiencies in data and costs, especially when a single agency provides all of the components.



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