Dealership customer-pay parts and labor sales average $46 billion annually. That is less than 20% of total parts and labor sales performed annually at all service centers. Therefore, over 80% of customers vote with their checkbook and spend their money at their local independent garage instead of the dealership.
Why is that? The following story explains part of the reason.
My brother-in-law lives on the East Coast and he’s mad. After he told me his story, I got mad and after you read this, you’ll get mad too.
Billy has a 2016 SUV with 98,000 miles on the odometer. It is immaculate on the inside, outside, and under the hood. He is meticulous with his maintenance, so when he got a recall notice from the OEM, he got right on it. The recall had to do with the climate control system.
Dealing with the Dealership
He was about due for a 4×4 Service (front differential, rear differential, and transfer case) and he’d been noticing a small drop of oil on his garage floor under the engine. So he thought it would be best just to get it all done at once.
He called the dealership to set an appointment. He went over everything with the advisors. Billy has one of those Lifetime protection plans for vital fluids, so he explained to the advisor that he wanted the Lifetime 4×4 Service.
“No problem,” the advisor said, “we’ve got that.” The advisor didn’t, however, know the price of the service.
When Billy dropped off his SUV he went over everything again with the same advisor he’d spoken with on the phone—especially the part about the Lifetime 4×4 Service. The advisor still didn’t know the price of the service.
Price Shock
They kept the vehicle overnight so Billy called the next day to see what they had found concerning the leak. It turns out there was a coolant leak related to the turbos, with a price tag of $2,600 to fix it—ouch!
Billy wasn’t prepared to spend that kind of money, so he declined the service. He did tell them to proceed with the 4×4 Service and stressed again that he wanted the premium lifetime service. Which the advisor again assured him they would do. (You probably have an idea where this story is headed, don’t you?)
The reason Billy was so persistent was because his OEM warranty had expired a long time ago, but his Lifetime protection plan stayed active as long as he did the service every 30,000 miles, and his last service was at 71,000 miles.
Reading the Fine Print
He picked his truck up at 5:45 pm on a Friday. After he paid the cashier $550 ($400 for the Lifetime 4×4 Service and $150 for the turbo diagnosis), he looked over the RO more carefully. There was no mention of the Lifetime 4×4 Service (just a regular 4×4 Service) and the part number of the gear lube they used wasn’t the gear lube he asked for.
Billy approached the advisor and said “it looks like you didn’t do the Lifetime service that I asked for.”
“Yes I did,” replied the advisor.
Billy continued “well it doesn’t show that on the RO and the part numbers aren’t right.”
The advisor said “well I’ll have to talk to the parts guy but he is gone for the day, so I will call you Monday.”
Getting the Runaround
As of noon the following Monday, no one had called. Billy called the advisor and got his voicemail. He called back an hour later and got voicemail again, but this time he left a message, but no return call. He called a third time around 3:30 pm and the advisor answered.
“Yeah I still haven’t heard back from the parts guy, I’ll call you later today.”
By this time, Billy’s concluded that this doesn’t pass the smell test. Either someone isn’t telling the truth or they are incompetent, or they just don’t care.
Of course, you already know that the call never came. Nor did a call come the next day.
On a side note: Line item #6 on the RO said they did a Multipoint Inspection. The MPI was never sent to Billy, texted or emailed, and the advisor never called to go over it. Conclusion: they did not check the vehicle. (If the RO says you did something that you didn’t actually do, the legal term for that is fraud!) Are you mad yet?
Dealership Loses Business
It is an understatement to say that Billy is done with the service at the dealership! Please understand, he is not a spiteful or vengeful person, he’s not going to rant against the dealership on social media, he’s not going to stomp and huff and swear and make a scene—he will just quietly never return to the dealership again.
This experience has so soured him that he will likely never go to any dealership ever again—unless he needs warranty work or a recall done. He’ll never spend money in a dealership service department ever again.
But the story doesn’t end there. Billy got to worrying about the turbo issue, so he took it to a local independent garage. They confirmed the problem. Their estimate to make the repair was actually higher than the dealership had quoted him, but he went ahead and authorized them to do the service.
Customer Lost
If the dealership proved unfaithful in saying they did the premium lifetime protection service when they really didn’t and unfaithful in saying they did a multipoint inspection when they really didn’t and unfaithful when they said they would call back, but didn’t—there was no way he was going to entrust them to do major repair work.
By the way, the garage kept Billy updated via text messages. They sent a beautiful color MPI with additional recommendations. Additionally, they did a safety report that assured Billy his tires, brakes, and vital fluids were in top shape. He wasn’t simply impressed—he was absolutely blown away!
The dealership lost a $2,600 sale and more importantly they lost a customer and his family, who by the way own six vehicles! Okay, now you are mad, right?
Lessons to be Learned
There are so many lessons to learn:
- If you make a mistake, come clean, fess up, and admit the error. Most customers are very reasonable and forgiving. (In fact, most of the time their respect for you will increase!)
- Do what you say you are going to do. Be a man of your word.
- Return your phone calls, texts, and emails promptly.
- Go over the MPI with the customer and ask them to purchase all of the service and repair recommended by their technician.
- If you don’t care (about people, about their safety, about their wellbeing) then please get out of the automotive industry and go stock shelves at Walmart.
Since 80% of vehicle owners fire the dealership service department when the warranty expires, dealerships must up their game. Good customer service is within your grasp. Treat each person like they are your best friend. Your action speaks volumes.
Customer Retention
Action Point: My suggestion to you is to use this article at your next weekly service sales meeting. Read Billy’s story to your advisors and then say “How could this have been handled differently?” Write down their answers on the board and discuss each one.
If you learn from someone else’s mistakes you can keep from repeating them.
Customer retention is king in todays business climate. You can’t change the world, but you can change you.
You retain customers one customer at a time. If you love your customer with good service, they will love you back with an open wallet!