By Phil Spagnoli, Regional Sales Director, Elead
Remember when industry experts were predicting that millennials weren’t interested in owning vehicles? Turns out, they were wrong. The millennial generation with close to 80 million members is expected to account for 40% of all new-vehicle purchases over the next ten years, according to research by Deloitte.
All of those vehicles will need service. That’s a huge opportunity for dealership service centers – but only if they can create a pro-millennial experience.
Millennials aren’t like the generations before them. They are digital natives, and therefore more informed. They are also more cautious, thrifty, and skeptical – especially when it comes to an industry with a less than stellar reputation. To earn their business, you have to convince them your shop is different – in every way. Otherwise, they’ll skip your service drive.
When I was the fixed operations director at a store in Washington, I was able to grow our millennial customer base. Here’s how:
Make your service department fun. You have to make your service department experience fun to get millennials to come back. Get rid of the drab 20-year old couch and blaring TV. Offer tablets with Wi-Fi in the waiting area, good coffee, and an assortment of snacks and drinks. Put on a current music channel that appeals to a younger generation. Don’t eat at your desks or allow staff to smoke outside and then walk in smelling. Put on what we used to call “the Disney show.” That means big smiles, a friendly greeting, and a welcoming presence.
Put transparency first. Millennials will price out services, and they won’t bother with a dealership that tries to hide costs. Not only that, but if they’re dissatisfied, they’ll take their opinion to the internet. They also won’t just take your word when it comes to needed repairs. Invest in a mobile, multi-point inspection tool with photo and video capabilities. This way you can show them what needs to be done, instead of telling them. Explain the process they can expect once they are in your shop and be as precise as possible with time estimates. All of this will help build trust so that you’re top-of-mind on their next visit.
Unless you show them proof, your millennial customer may think that you’re trying to push work that doesn’t really need to be done. Conducting a multi-point inspection every time helps you engender trust and reduce skepticism. For example, let’s say last time the customer came in, their tires were worn but not in the danger zone. Now they’re back in your shop, and the tire treads are in the red danger zone. You prepared them by being transparent and open last time. This information is not a shock, so they are more likely to approve new tires.
Streamline with technology. 86% of millennials expect an integrated, seamless experience where they are effortlessly moved between smartphone, computer, and physical store. The ability to easily schedule an appointment online, receive service reminders and updates through text, and pay the bill virtually will all resonate with this generation.
Consider one point of contact. This may be controversial, but consider implementing a single point of contact service model. The same person checks in the customer, walks them through the inspection, delivers updates, and handles the payment. This can help with the cloud of misconception over many dealerships that employees will push every service and repair under the sun. Interacting with one person using a transparent inspection process helps take away that cloud and builds trust.
Market using social media. You can’t count on email or old-school advertising to reach millennials. They are on social platforms like Instagram and TikTok. Most stores don’t market there, so you have an opportunity to really stand out. However, don’t be pushy. Nothing turns millennials off more than a hard sell. Instead, play around with service teaser posts that talk about your shop without looking like you’re trying too hard. Here’s an example of how Starbucks teases its audience by introducing seasonal drinks without trying to force people to buy.
Think outside the box for ways to get customers to advertise for you. For example, our service department used to pull a list each month of the top five spending customers. We sent these customers a bobblehead or another trinket for a local sports team as a thank you. The majority would snap a photo, post it to Instagram or another social platform, and tag our dealership. That type of advertising goes a long way, and it’s inexpensive.
Implement loyalty programs. There’s a common perception that millennials aren’t loyal, but that’s definitely not true. The difference is, they want you to earn their loyalty. A study by Accenture found that 95% of millennials want brands to actively court them with personalized, targeted promotions, and discounts.
When creating promotions think about what’s important to millennials. Many are socially aware and want their dollars to do good in the world. One promotion that worked for us was donating a portion of every repair ticket to a rotating list of non-profit organizations. Pick three organizations per month and allow customers to choose which receives a portion of their payment. It’s an easy way to give back and differentiate your shop from competitors.
Millennials have massive buying power and they’re entering the vehicle market in droves. Now is the time to re-think your service department to prove to these savvy, digital natives that your shop is different. The reward will be loyal customers for years to come.
About the Author
Phil Spagnoli has worked his entire career in the auto industry, including serving as Fixed Ops Director and Service Manager for a dealership in Washington State.