Despite the fact that regular service increases the life of their vehicles, customers often put service visits off for as long as they can. In fact, as vehicle quality continues to improve, DMEa consumer surveys show that more motorists than ever are ignoring OEM-recommended service intervals—because 32% of survey responders say “it does not seem necessary.”
That’s serious news for dealers, who lose critical service revenue as customers wait longer between services. This contributes to the ever-increasing dealership service interval. The average time between dealership service appointments has increased by 4.2 days, costing dealers an average $85,650 annually in service revenue, or about $20,400 in revenue per store for each day added to the interval.
To overcome this obstacle to dealers’ revenue and retention, they must implement targeted customer communications, powered by the intelligence of a comprehensive life cycle retention program. Effective communications engage customers between service reminders, when they’re most likely to stray to aftermarket providers.
Mid-interval communications are communications sent during the interval between a motorist’s last visit and the next naturally occurring visit for regular maintenance. Powered by a strategic marketing model, these communications highlight for the motorist their need for tires, brakes, and battery services between the recommended factory interval visits.
More importantly, these communications send the message that the dealership is the best destination for these services. Through the right program and with the right data-powered engine behind them, customer communications make a huge impact on customer engagements, and thus your bottom line.
Using big data and predictive analytics, you can divide your customers into segments by their scientifically supported likelihood to need high-margin customer-pay items like tires, brakes, and batteries. From there, you can target communications to customers who are most ready to buy. Subsequently, you recover game-changing revenue, and achieve substantial marketing lift.
Using this model, your communications target the customers most likely to have a customer-pay transaction in the next 60 days, and sends them an engaging, personalized message. These mid-interval messages inform them of key retention services they need, while ensuring they come back to the dealership to get them.
Mid-interval communications deliver real results. In fact, DMEa research shows that mid-interval communications, powered by big data and predictive analytics, improve customer response by up to 38% over “spray and pray” and other outdated methods. Additionally, these communications have been shown to increase service revenue by up to 11% per repair order.
These communications are also effective in attracting the customers who are most at risk to shop elsewhere for services. After all, unless they’ve sworn off vehicles altogether, even customers who may be lapsed in their service habits will eventually find themselves in need of an oil change.
Even as the manufacturer requirements change and/or your service customers’ behaviors change, don’t let them wander to your competitors. Send a targeted, tailored mid-interval communication reminding them to come back for what they may have missed, such as a lube, oil, and filter service or tire rotation.
Customers come to the dealership for quality service with a friendly, personal feel. And you know that your customers are the lifeblood of your business.
So, do what good friends do: Meet them halfway and keep in touch.
Mike Martinez, chief marketing officer, leads the global marketing, product management, and strategy & analytics efforts for AutoPoint, a Solera Holdings company. For more information, please contact [email protected].
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