As appeared in Canadian auto dealer in November 2016
By: Todd Phillips
With vehicles becoming more of a commodity purchase, focusing on service excellence is one way to further differentiate your dealership from the competition, dealers were told at an exclusive OEM Forum event held in Toronto yesterday, organized by F&I provider LGM Financial Services Inc.
Diana Ricketts, the company’s VP of Strategic Partnerships kicked off the event with some observations about the impact of changing customer expectations for dealerships. “A lot of things have changed in the industry, and a lot of things have stayed the same,” says Ricketts. “One of the things that has stayed the same is service excellence,” adding that was one of the core values of the company.
The theme of the event, held at the upscale Spoke Club in Toronto, was exceptional service, exceptional results, “building a five-star customer service experience.” It featured two guest speakers.
The first was J.D. Ney, Manager, Research and Consulting at J.D. Power, who spoke about the forces at play that are disrupting the auto retail industry. “Change is coming to a space where people haven’t been willing to make a change for, oh, about 100 years,” says Ney. “Is disruption coming to the auto space — yes.”
Interestingly, Ney says he didn’t expect big players like Google and Apple to make a serious play in vehicle manufacturing, but thinks they will compete for the interior of the automobile space.
Ney said many “car people” attach more important to vehicles and brand than many consumers, many of who see vehicles as functional tools, and increasingly transportation services. A lot of buyers are “functionalists,” says Ney. “Can I put my stuff in it and get my family from here to here. If so, fine,” says Ney. “Phone loyalty is much stronger than vehicle loyalty,” he says.
More young people are open to alternate forms of transport as we evolve from an “owned economy” to a “subscription economy” with transportation as a service. Uber is a driving force that is attempting to depersonalize mobility.
More young people are open to alternate forms of transport.
The biggest risk for dealers is something that ultimately they can’t do anything to prevent. “The expectations of our customers are set at almost all the other retail experiences they have,” says Ney. People always ask why their car dealership experience wasn’t as “delightful” as their other retail experiences — particularly when they are parting with so much cash on sales or service.
One of Ney’s slides said: “The curtain has been pulled on our dealers — and it’s not coming back.”
With the power shifting to consumers, the only option is to provide them with a better experience. This involves using new technologies, not just because it’s cool, but because it increases transparency and makes for a faster and better experience.
“They know what they want to buy — and they have a good idea what they want to pay,” he says.
Ney said dealers also have to stop talking about millennials as a “future group of buyers” since they already represent the second largest car buying group in Canada.
Ney also took dealers through bad examples of customer service that exist at many dealerships, including the fact that the average consumer can only easily access wi-fi at about 50 per cent of dealerships in Canada, and that online booking services are often just forms to fill out to trigger a phone call — a call someone was trying to avoid by going online.
For his part, guest speaker Micah Solomon, an award-wining author and speaker presented a colourful and animated overview of how marketing has changed and how the traditional approaches no longer work.
He said people have stopped believing what brands say about themselves. “It’s what others collectively say about you that matters,” says Solomon. “Customers are in charge. Customers know they are in charge,” says Solomon. “From time to time you may be tempted to forget this. This is a bad move.”
He showed several examples of how companies inadvertently send the wrong messages to their customers. One example was when he found a string attached to the corkscrew in a nice hotel he was staying in. Do they really think I’m going to steal their corkscrew? he asked.
To be truly customer centric, you also have to hire the right people who have the right traits for customer service. For the people greeting customers at the service adviser desk at dealerships, for example, are they hired for technical skill and automotive knowledge or to be customer facing? These are simple fixes that can go a long way to improving your customer service experience.