At the North American International Auto Show, Ford unveiled an interesting new program to the world – FordPass. According to The Detroit News, Ford’s goal with this app is to create a centralized hub which allows Ford owners to utilize some unique services related to ride-sharing and mobility. Some of the planned features include FordGuides, which allow Ford owners to ask questions and get answers via text or phone 24 hours per day; and FordHubs, which are actual buildings Ford owners can visit to learn more about Ford technology. Additionally, Ford owners will be able to utilize the app to obtain free parking at airports. These parking lots then rent out the owner’s vehicle while they are away. Ford owners will be able to use the app to locate and reserve parking spaces as well. According to Ford, it is seeking to expand the app to include ride and car sharing as well. The app also introduces a new loyalty program which will reward app users with points that they can redeem for prizes.
While I can certainly see the value of utilizing some of these services should an owner live in a dense market with limited parking like New York or Los Angeles, it would seem as if the initiative seeks to keep Ford owners “in-house,” so to speak. Most of these services already exist. And the offerings are via partnerships with existing companies. Consumers could easily download free apps from the companies whose services they desire already — without a Ford branded app. It’s also not clear whether a consumer would be willing to allow a parking garage to rent out their vehicle in exchange for free parking at an airport. Trading a small daily parking charge in a long-term parking lot, for some stranger driving around in your vehicle, seems perhaps a bit of a stretch. So, what’s motivating Ford to provide this app. And, how will they get consumers to use it? The integrated loyalty program is the key.
Ford is piggybacking, if you will, on the more popular services that are rising in the peer-to-peer economy. I would not be surprised to see Ford launch an Uber-like service in the future. Wait. It just did. Ford also announced its Dynamic Shuttle Service, which is an Uber-type service currently used exclusively by employees. This service, in partnership with IBM, is also being used to test their Smart Mobility Experimentation Platform, which “will aggregate data every 10 to 15 seconds to provide drivers with information like the route with the least amount of traffic and areas with open parking spots.”
Only time will tell if Ford is making the right move. It would seem that trends such as ride and car sharing, along with the explosion of Uber (worth $60 billion after only 5 years) may indicate that it is. However, remember that while these services may be popular for consumers that live in densely populated markets, it’s hard to fathom rural owners taking advantage of or needing most of these. While the loyalty program may attract Ford owners to access these services through their centralized app, we’ll just have to wait and see how owners actually respond once it is launched in the Spring.
An interesting study conducted by MaritzCX and published on CustomerThink relays how dealers should care about – and invest in – the creation of a better customer experience in their stores.
While customer experience can be vague, and in the past has mostly been measured through surveys and CSI scores, MaritzCX conducted a comprehensive study to show dealers the only factor that affects the bottom line – and that is revenue. The study’s results illustrate that when a dealer climbs one level in customer satisfaction (i.e.: from “satisfied” to “very satisfied”), sales volume increases on average by 329 vehicles per year, adding $64,000 in additional sales profits. In addition, the same customer experience improvement in service increases revenue by $41,646 per year. According to the study, “combining additional sales profits and service profits reveals a potential incremental gross profit of $106,315 per year for the average dealership.” By contrast, when the customer experience moves down a level, the study found a decrease in gross profit of $191,624.
Customer experience is currently a hot topic with dealers and vendors. However, many dealers are hesitant to spend lavish amounts of money on showroom improvements, or luxuries without a concrete answer to the most important question most dealers ask – “What’s my ROI?”
The MaritzCX study was able to capture the monetary benefits for dealers investing in an improved customer experience. It certainly falls in line with what loyalty experts have been preaching for years. Customers that have a consistently great customer experience tend to spend more money with the dealership and also refer their family and friends. This referral activity provides dealerships with increased exposure and opportunities that they may not have had otherwise. This represents additional revenue producing possibilities in both sales and service.
Brand loyalty is increasingly difficult to achieve — and brand advocates are even harder to capture. Dealerships that continue to operate as is, without identifying customer pain points in their experiences – whether those be service or sales – risk losing business to either competitors, or independent service repair facilities. Ensure that conditions are optimal to provide that great experience on a consistent basis to each and every customer. This will help maximize the potential of the customer being loyal and of capturing their future business, directly or through referrals.
In the end, part of every customer’s buying process involves making the decision who they want to purchase a vehicle from. Treat your customers right, provide a great experience and take the time to really show them you appreciate their business. This then acts as a catalyst for all of your other brand enhancing activities – high CSI scores, increased online reviews and word of mouth advertising. Neglect customer experience at your own peril. Today’s consumers are far less willing to put up with a poor experience and will very quickly take their business elsewhere. Improve your customers’ experience in your store and ensure that they are well taken care of. Foster brand loyalty and create brand advocates. Your bottom line will grow because of it.
Now let me explain.
In our industry – as well as life – we continuously talk about transparency. Let’s be brutally honest here. Sometimes honesty isn’t the best policy. Is it always that way in real life? If your wife asks you whether she looks fat, you know you’re always going to say “No.” How about those times you go to a friend’s house for dinner and, well, it’s not exactly great. Do you tell him or her? Of course not. You politely say it is good, make a valiant effort to clean you plate and then pick something up to eat on your way home. We like to call these instances of non truth “white lies” and justify them with the knowledge that, in some cases, it’s better to tell a lie than to upset someone by being honest.
Are there parallels in the business world? Of course there are. I’m certainly not talking about deceiving a customer in a transaction, or lying about something of substance. What I’m talking about are those instances where a lie actually preserves a relationship – similar to the goal of the white lies I previously described. When you’re interacting with people, just because they’re customers doesn’t change the fact that they’re human beings. That customer that comes in and needs a lot of help getting financing because their credit is horrible doesn’t need to be beat up and embarrassed. You never know if there’s a co-signer waiting in the wings. You may know for a fact that they aren’t going to get approved anywhere. But you tell them you’ll try. Perhaps you present their file to some of your sub-prime lenders. But ultimately you call the customer and let them know you can’t help them. Think about this though… Some of the most loyal customers began as special finance customers. When one comes through your doors that you can help and they leave with a car, they will just about kiss you. Not only will they be forever grateful, they’ll send every person they know to you. It’s no different with people with excellent credit. It’s all about treating them with respect and providing an excellent buying experience.
There are times when little white lies can actually improve your customer’s experience. For example, imagine a customer calls a week after trading a vehicle in and says they believe they left something valuable in their vehicle. Perhaps this vehicle has already been detailed and cleaned, or even wholesaled out. The fact is that YOU know there is nothing in the vehicle. You could tell the customer you won’t (or can’t) check for them. In which case they’ll be upset, OR, you could tell them you’ll check and call them if you find anything. Which path do you think will be more conducive to maintaining the customer’s satisfaction?
Our world would probably become chaos if everyone could do nothing but tell the literal truth. Customer loyalty and experience sometimes requires telling the customer what they want to hear simply to let them save face, spare their feelings, or satisfy their needs. Keep in mind that there is a fine line but, for the most part, if you treat people right and use your conscience to make decisions — just as you would if your wife asked you a question that it would be unwise to answer honestly — you’ll find yourself making more friends and keeping more customers.
Point in case: Doug Demiro, a former manager of Porsche Cars North America, and now author of a popular column on automotive website Jalopnik, answered a in his column that illustrates this point very clearly.
The question essentially boiled down to this: “Do those letters and e-mails from dealers saying they really want your trade-in actually mean anything? Do dealers really want your trade-in? Are they going to pay top dollar for your vehicle because they have some customer who desperately wants it?”
His answer: NO
Go ahead and read the article. It’s pretty much how consumers perceive these offers. The comments are also rather entertaining. It’s all consumers sharing experiences in which they received a similar offer and actually wanted to take the dealership up on it — until they found out the dealer couldn’t deliver, or that the offer was unobtainable. And now, in general, they assume ALL offers are simply ploys and conspiratorial plots to entice the customer into the dealership.
Are they right? Is that what we’re doing?
Well, that all depends on how responsible a dealership is in handling their marketing. Dealerships who turn over their entire DMS to outsourced BDCs, direct mail companies, extended warranty companies, or any other vendor without first segmenting out and vetting that database to ensure that it is correct for that targeted message; that the recipients of the message qualify for the offer; are in fact, for the most part, doing more harm than good.
All this type of poorly thought out, uncoordinated mass blanketing of promotion does is create an aura of mistrust with existing customers. By blasting them with irrelevant messages you make it more difficult for the customer to believe ANY message they receive – even if it does apply to them. This practice, which is still more widespread than many realize, in turn gets projected onto the retail auto industry as a whole.
That being said, smart dealers understand the importance of segmentation and relevant messaging. When a dealership realizes that “spray and pray” hurts more than it helps and takes the time to segment its database and send relevant messages to those customers most likely to be interested, the campaigns – no matter what form of marketing it is – will always perform better. Why? While you may be marketing to less people, those people are more likely to take you up on your offer. They’re more likely to convert when they come in, since they will actually qualify. And you’ll spend less money to achieve better results. The side effect of segmenting your marketing messages is that you will start to earn your customers’ trust. They still may not believe everything you send them (even if it’s true). But, when they come in and discover that you can actually fulfill the offer, not only will you win their business, but also their trust. And that’s something all dealerships and our industry certainly needs to do.
In the automotive industry, hundreds of customers pass through dealerships on a daily basis. Each of these customers will interact with dealership staff multiple times during their visit – whether they’re there to buy a car, or for a simple oil change. It’s very easy to function as an organization with a focus on efficiency – how quickly can you complete a repair, how quickly can you get someone in and out of the finance office, etc. We are, after all, in a society that’s always on the move. The trend is to speed things up for the customer. By doing so, however, we neglect the biggest part of customer’s experience and the most important piece of the big puzzle that is customer loyalty: personal interaction.
All too often we go through our days thinking that if we don’t get complaints, our customers are happy. But, that’s not usually the case. Running the dealership like an assembly line serves only to depersonalize the experience. While you may not hear a complaint, you shouldn’t assume that every one of your customers had a good experience. You’d think that if there was something substantially poor about their experience, the customer would inform you. And some customers would. But what about little things that affect the experience? In many cases the customer either doesn’t feel it’s worth mentioning, or doesn’t think anything will be done about it. Those customers complete the transaction with you and go on their way leaving dealership employees with the impression that their experience was satisfactory, assuming they will return. And, in many cases they do…
Until another company offers them a superior customer experience.
All of a sudden, this repeat customer simply stops coming in. Oftentimes, we’re left clueless as to why. Did we do something wrong? Was there a bad experience that we didn’t know about? Is it a price thing? Did they move? We mine the DMS and email coupons and offers to dormant service customers that used to come regularly, to invite them back. Sometimes they respond or take advantage of our offers, and sometimes we’re left wondering.
So how then are we supposed to know whether a customer really had a good experience during their visit? It’s very simple. We ask.
Human interaction is the single most effective way of gauging the thoughts of another. Just as you can tell when someone isn’t telling you the truth, or is unhappy despite what they may say, the same occurs when your sales manager or service advisor makes sure they speak to the customer before they leave. Take the time to thank the customer for their visit and ask them how their experience went after each and every transaction. This can help to identify problems. Perhaps it was something as small as the fact that the restrooms were dirty, or there were no paper towels. Perhaps the car wasn’t washed to their satisfaction or there are greasy fingerprints in their car. The customer may just leave feeling irritated. Having knowledge of that fact right then would allow you to fix that issue so that another customer does not have the same problem.
Make it a point to train your employees in the importance of conducting exit interviews with every customer. If they’re in sales, a manager TO is the perfect opportunity to thank the customer and ask how their experience was. You’d be surprised how that previously quiet customer all of a sudden opens up when a new face with authority asks them. In service, have your service advisors or, if possible, your service manager do the same thing prior to a customer leaving. Identifying customer complaints or service hiccups can go a long way towards ensuring that the experience for every customer is as optimal (and consistent) as possible. It doesn’t take much to lose a customer nowadays. Taking a few extra minutes with each customer will show them that you care and that will go a long ways towards earning and keeping their business.