A recent survey of automotive dealership service department customers revealed a startling observation: half the vehicle owners surveyed were never asked to buy additional needed maintenance or repair services. The study by DealerRater, conducted last fall, asked vehicle owners about their most recent service visit. It went on to show that 80% of those that were asked to buy additional services said “yes” and had the work done at the dealership! That means that 8 out of 10 said “I trust my dealership, I trust my mechanic, I trust my advisor, and I’m going to follow their advice!” (Your general sales manager and sales staff would give anything to have that kind of closing rate with new and used car buyers!)
The study of over 8,800 customers showed without a doubt that when you present customers with the technician’s recommendations for needed maintenance and repair, an overwhelming majority of them will buy.
It also showed that when you don’t ask, they don’t buy.
Asking for the sale gives you an 80% chance of making the sale. Not asking for the sale gives you a 100% chance of not making the sale.
This isn’t hard to understand.
But what about the other half of the advisors that didn’t ask? What’s their issue? Again, it isn’t hard to understand: they are either unprofessional, unmotivated, poorly managed, poorly trained, under-compensated for sales performance, or they just don’t care. It is beyond my comprehension why an intelligent person would not recommend needed maintenance—especially when the odds of the customer saying yes are so high—yet, it happens every day on dealership service drives.
Here are the exact numbers from the survey:
- 47% were not asked
- 43% were asked and had the work done at the dealership
- 8% were asked and said “no”
- 3% were asked and had the work done somewhere else
(The numbers don’t total 100% due to rounding.)
I know some of you are thinking, “wow, if they surveyed my customers, would the results be even worse!” Nobody’s perfect, and no matter how vigilant you are with your advisors, there will always be a lot of meat on the bone—a lot of missed opportunities.
At this point, I want to digress for just a moment and insert a word about leadership.
As you pass this information on to your service advisors, I want to encourage you to mentor and coach them on how to ask for the sale. Rather than a harsh demand to “get out there and sell more,” I would suggest you provide them quality training on salesmanship, set up a series of performance benchmarks, and then hold them accountable.
Waldo Waldman is a former Air Force fighter pilot; he says it’s better to be a commander than a demander. Demanders lead by fear and use their power to serve themselves. Commanders lead by example and use their power to serve others. Are you a commander or a demander? If you are having trouble discerning which you are, then look at the results you are getting from your leadership style.
When dealers and middle managers act like commanders, then the service sales staff (advisors) will respond with sales success resulting in increased revenues. Commanders who are servant leaders enjoy great respect, great loyalty, and great results from those under their command.
Getting back to the focus of this article, advisors must ask for the sale, but it is equally important to do it the right way.
AAA recently released the findings of a survey that showed two out of three Americans do not trust automotive service centers (including dealerships). The biggest reason—cited by 76% of respondents—was the feeling that service centers recommend unnecessary services. Let that sink in for a minute; 76% of those surveyed said “I don’t trust my automotive service provider because I think they try to get me to buy stuff that my car doesn’t need.” Wow… what a slap in the face. They are basically saying that our industry is filled with crooks and con artists that are looking for naïve people to take advantage of.
That is absolutely false—but, that is the perception; that is how our industry is viewed. To drive the point home, this issue of distrust came up in a webinar I did late last year for a dealer group in Canada. The topic was about overcoming objections, so I asked the service advisors to give me the objections most often heard from their customers when they offered technician-recommended services. Near the top of the list was this one: “Do I really need this service?” In other words, the customer perceived the dealership was just making stuff up in order to turn a buck.
So how should the automotive industry respond? It centers around the way your advisors present technician recommendations to your customers. A good multi-point inspection form is critical, an accurate vehicle history is critical, a complete menu is critical, and a professional presentation is critical.
I’ve seen a few weak managers say that “since people think any upsell is a ripoff, then we’ll just stick to what the customer tells us to do.” How absurd! And these guys wonder why their customer-pay hours per repair order is .9 or lower.
No indeed, my friends. The correct response is not to back away from performing needed services, but rather to have your advisors sharpen their presentation and selling skills when bringing technician’s recommendations to the customer’s attention—every car, every recommendation, every time. Remember, when presented correctly, DealerRater found that 80% of your customers will say yes. (But if you only sell 40% of them, that’s still a huge revenue stream!) Happy Sales to You!
My personal thanks to James B. Treece for permission to use the DealerRater survey and to Erin Stepp for permission to quote from the AAA report.
Author: Charlie Polston
Charlie Polston is an Automotive Customer Retention and Profitability Consultant with BG Products, Inc. Charlie has been with BG’s Fixed Operations Division for over 34 years.