Let’s just say it out loud, yes, there are headwinds and challenges ahead for dealerships. Yes, the challenges are in both sales and service. Whether you look at the insightful data from Cox Automotive which states that only 30% of total vehicle service business is going to dealerships, or the continual and growing retention problem plaguing the service advisor role or the never-ending frustration of customers during a disjointed and slow sales process – there are undoubtedly problems to solve in dealerships. Now that we have confessed to the problems, what will we do about them – innovate or stagnate?
I read some interesting data recently about the major cause of death for people over 65 in the US – a sedentary lifestyle. The data was very specific and said that the lack of movement, walking, or exercise in people 65 and older was the cause – they said that sitting still in front of the TV or iPad is killing us. When I look at our dealership models, the sales department’s Road to a Sale (RTAS) or the service drive process, most of them were developed in the 1960s and have not changed much. Yes, in sales there was the advent of the Internet which added a digital process to the front-end of the RTAS and yes, we added technology and MPIs to the service process. However, most everything is an adjustment to the original process and not an innovation and the result has been frustrating to both customers and employees.
In 2024 the question is simple – will this be the year that our 60+ year-old processes lead to a cause of death in dealerships? I will boldly say that the RTAS is dead and has been for a decade and technology has reshaped how people want to and fight to be able to purchase. I will also boldly say that the Cox data showing the number one reason people don’t do service with dealers is trust and not price is correct! When you have to write 20+ R/Os a day who has time to slow down, build relationships, and build trust? When you have to juggle the MPI calls, callbacks, recall questions, and carryovers from the previous day – who even wants to slow down and do the trust-building work?
Today’s sales customers have a buying journey in their head and all they want in the whole world is someone who will help make the journey easy. In 2024 dealers need not worry about the competition’s pricing or marketing – they need to be scared of every competitor that will make the buying process easier for the customer. The question for good stores and average ones is simple – what will you do this year to make it easier for every customer? The inability to train, empower, and support a team who has that focus will cost deals and profits.
Today’s service customers want to call and talk with an empathetic, caring person who will start an integrated process that makes a service visit go smoothly. Today’s service customers want to arrive and be a welcomed guest and not an inconvenience in a busy person’s day. They want someone to listen and to deliver value that builds trust – not an overwhelmed person juggling an appointment every 10 minutes.
2024 is the time to innovate, to redefine all dealership processes through the lens of how things can get easier, faster, and simpler for employees and customers together. Tweaking the current process or thinking that we can “control” the customer will only provide the same results – 30% of service business and a less than 20% sold rate in sales. The dealers who will grow and eventually win are the ones who will try new things. What will it look like when we create a service advisor team that works to surround the customers with effective communication and caring service? What will it look like when sales stop refusing to talk about trade-in values without the customer bringing the vehicle in first so we can U/V that trade?
In service innovation, we will need to solve the communication challenges from appointment scheduling to advisor conversations with the customer. Innovation will need to solve the hours and workload challenges that impact advisor morale and retention. Innovation will need to include the accountability process for service teams to provide a customer experience that clearly demonstrates empathy, care, and concern – they are the only path to the increased trust needed to regain market share from independent shops.
Let us end by remembering the central facts – our processes are 60+ years old and the number one cause of death for the over 65-year-olds in America is a sedentary, stagnated lifestyle. Dealerships and their teams are too good to die young – let’s fix this!