Fixed Ops Journal - October 2020 - F23

Crisis offers ways to lift customer retention

D

DAN SHINE

seen this picture get worse, particularly for
older vehicles."
Each point of retention is worth billions of
dollars in high-profit service sales for dealers
and parts sales for automakers, she said. Retention also drives brand loyalty to sell more
vehicles.
The Carlisle report also showed that across
nearly every customer-satisfaction metric,
franchised dealers are trending downward.
Net promoter scores for dealers are about 15
points lower than for independent repair facilities.
The only bright spot - that customer-pay
sales per repair order are up about 1 percent
for both premium and non-premium brands
- also is clouded.
Johnson said the report shows premium
brands' hours sold per repair order is stag-

nant, meaning the growth in sales per RO likely stems from higher pricing instead of increased demand.
"We think that some pricing increases are
really kind of both masking and perpetuating
the problems that we're seeing get worse over
the past few years," Johnson said. "It's really
critical that we change and try to change
quickly, especially due to COVID."
She said the potential drop in sales combined with the recession only magnify the importance of these issues.
Johnson said fixed ops departments will be
critical in helping dealerships weather this
storm. "Fixed ops really needs to carry OEMs
through this downturn," she said.
Some ways to do that would be to continue
with service pickup and delivery and mobile
service vans. She also said the brands Carlisle
sees with the highest retention numbers offer
free and prepaid maintenance packages.
Johnson also recommended a renewed focus
on recruiting and retaining high-quality personnel - including techs and advisers - as
well as preparing the service lane for new products such as electric and autonomous vehicles.
"We really think it's important to actually
leverage what's going on with COVID to make
a big paradigm shift now to really change how
we have traditionally done business for years
and years," Johnson said.
To do things differently and make them better for customers "can improve this whole retention and sales picture." 

One thing they would have done differently
at the start of the pandemic
Matthews: I dipped my toe in a little bit with a
mobile technician. If we could rewind, I would
have really invested the time and money in that
mobile technician. That could have made a
huge, huge difference in our bottom line.
Latino: I wish that we could have explored
the pickup and delivery a lot sooner. I think it
would have given us the advantage, not only
over the aftermarket, but also customers
would have known that we were out there for
them.
Doering: We were lucky to have a platform
ready for pickup and delivery, but what became very quickly evident is you also need to
have the right integrations. You need to have
scheduling set up properly and working, you
need to try to keep the customer in one environment.
We launched a great platform that worked

very well for the dealer and customer, but it
sat in the form of an app which created some
challenges. That's all since been fixed, but ideally I would have been further along with integrations when we launched.
The mobile tech also is one that we would
have been thinking about [but] weren't far
enough along to pilot. I think COVID has reinforced with us that that needs to be in the tool
box for service. If we believe our customers
should receive service how they want to, I
think that there will be some customers looking to that. And I think as technology changes
and software becomes a bigger part of what's
done in the workshop and with electric cars, I
think there's maybe an easier business equation around mobile tech going forward than
the huge vans fully outfitted to do anything.
We can be very tactical in mobile service in
the future and deliver good customer value.
- Dan Shine

dan.shine@crain.com

ealership service departments
across North America are plagued
by troubling customer retention
and satisfaction scores, and any increase in customer-pay sales per repair order
is likely the result of higher prices, not growing
demand.
This sobering assessment came from Carlisle & Co.'s 2020 North America Service
Benchmark report. Carlisle collected 2019 data in February from a group of participating
automakers representing 15 brands, which
the company then analyzed for key trends.
Eliza Johnson, who leads the company's service benchmarking practice, shared the findings to kick off the first installment of the 2020
Automotive News Fixed Ops Journal Forum.
(The online event aired Oct. 8; replays at
autonews.com/fixed-ops-journal-forum.)
Despite the bleak outlook, Johnson told attendees that the coronavirus pandemic offered an opportunity to make positive change
in the service lane.
Among the report's troubling trends is stagnant or declining customer retention numbers
on 1- to 7-year-old vehicles with at least one
customer-pay service visit. For vehicles 8 to 19
years old, retention declines even more rapidly.
"The picture here is a little more concerning," Johnson said. "Not only does retention
continue to drop off with each year a vehicle
ages, but over the past several years we've

FORUM

continued from previous page

[off ] look like? How can I have the weekends
off? What does my schedule look like? We're
open from 7:30 a.m. to 9 p.m. That schedule
that I've laid out for some of the older technicians doesn't look that attractive to some of the
younger guys coming out of school. How do
we attract these younger technicians that are
coming out of school that are 25, 26 years old?
They want to make big bucks, and they want to
work six hours a day. And take lunch.
Doering: We've tried to sort of dig into one of
the pain points for these technicians coming
into the auto field. One of them that we identified and we're trying to address right now is
tools. It's kind of a big ask [to have] these kids
pay for their own education and then over the
first 10 years invest a significant amount of
money in tools. That's a barrier.

Carlisle's
Johnson

OCTOBER 2020

PAGE 23


http://www.autonews.com/fi

Fixed Ops Journal - October 2020

Table of Contents for the Digital Edition of Fixed Ops Journal - October 2020

Contents
Fixed Ops Journal - October 2020 - Intro
Fixed Ops Journal - October 2020 - F1
Fixed Ops Journal - October 2020 - F2
Fixed Ops Journal - October 2020 - Contents
Fixed Ops Journal - October 2020 - F4
Fixed Ops Journal - October 2020 - F5
Fixed Ops Journal - October 2020 - F6
Fixed Ops Journal - October 2020 - F7
Fixed Ops Journal - October 2020 - F8
Fixed Ops Journal - October 2020 - F9
Fixed Ops Journal - October 2020 - F10
Fixed Ops Journal - October 2020 - F11
Fixed Ops Journal - October 2020 - F12
Fixed Ops Journal - October 2020 - F13
Fixed Ops Journal - October 2020 - F14
Fixed Ops Journal - October 2020 - F15
Fixed Ops Journal - October 2020 - F16
Fixed Ops Journal - October 2020 - F17
Fixed Ops Journal - October 2020 - F18
Fixed Ops Journal - October 2020 - F19
Fixed Ops Journal - October 2020 - F20
Fixed Ops Journal - October 2020 - F21
Fixed Ops Journal - October 2020 - F22
Fixed Ops Journal - October 2020 - F23
Fixed Ops Journal - October 2020 - F24
Fixed Ops Journal - October 2020 - F25
Fixed Ops Journal - October 2020 - F26
Fixed Ops Journal - October 2020 - F27
Fixed Ops Journal - October 2020 - F28
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