This article could be titled “Robert Atwood (Part Two)” because it really is a continuation of last month’s article. Atwood is a senior instructor at NADA Academy in McLean, VA and a frequent automotive industry speaker. I’ve known him almost twenty years and he is one of my trusted advisors for all things related to fixed ops.
Atwood recently spoke to a group of dealers and managers in downtown Oklahoma City. He was gracious enough to let me pass along some of his “Best Practices.”
The Statistics Point to Opportunities
Atwood began by citing a survey conducted by Exxon Mobile showing that 40% of those surveyed plan to keep their cars for at least 150,000 miles, while 23% intend to hold on for over 200,000. To drive the point home, AAA found that 54% of Americans intend to keep their current vehicle so they can avoid the financial burden of a new one.
“CSI stands for Customer Supplies Income!” – Robert Atwood
The point is that dealers had better create a marketing strategy to attract (or hold on to) older vehicles. Honestly, why should owners of older, higher mileage vehicles gravitate to the aftermarket? If the best place to service a new still-under-warranty Toyota is at a Toyota dealership, and the best place to service a three-year-old Toyota is at a Toyota dealership, then the best place to service a ten-year-old Toyota is also at a Toyota dealership!
Yet, according to Atwood, Cox Automotive, in a recent maintenance and repair study, found dealerships are only seeing 30% of all service visits. (Only a dismal 17% returned to the service department of the same dealership where they bought the car.)
Action Point: You’d better insist that your employees do a better job of the sales-to-service hand-off. Maybe sales-to-service retention should be tied to the sales manager’s compensation package. It’s that important. Next you should figure out an incentive to woo those wayward customers back to your service drive. Maybe it’s as simple as a free oil change, tire rotation, and inspection. Obviously, it’s much easier to retain customers than to win them back after they’ve left you.
Sell Tires, Retain Customers, Make Money
“Seventy-five percent of consumers purchase tires from the first person who recommends them,” Atwood stated. But that’s not the most important statistic; check this out: Atwood went on to say that a staggering 78% of consumers maintain their vehicles at the place where they purchased tires! Wow!
I know the owner of a small group of Goodyear stores. He told me there is no money to be made selling tires. None. He went on to say there is also no money in rotating tires. None. He said they sell tires to make customers, they rotate tires to retain customers, so they can sell maintenance services to make money! That’s pretty simple and yet very profound!
Action Point: Atwood recommends a “worn tire display” that is color-coded. The worn out, thread-bare tire is painted red, the tire with about half of the tread depth remaining is painted yellow, and the new tire is green. Your advisors should carry a tread depth gauge in their pocket at all times and let the customer see them checking the tires during the walk-around. Be sure your advisors understand the importance of selling tires; make sure they see the big picture. Selling tires is the “means,” it’s not the “ends.” Selling tires is the means to the end. The “end game” is selling preventive maintenance—that’s where the money is! Selling tires opens the door, rotating tires keeps the door open, and selling maintenance services brings in the money.
Surely this isn’t the first time you’ve heard about the importance of selling tires, is it? In fact, I bet you have a color-coded tire display on your service drive right now. But have you taken the time to mentor, train, and coach your advisors on how to close the sale? If not, why not implement a process today? It works.
Mentor, Train, and Coach Your Advisors
“Your service advisors have the largest influence on the public’s image of your dealership!” Atwood observed. “Take an objective look at your advisors; are they the right people in the right positions? Do they represent who you are?” Moreover, your service advisors must be masters of closing the sale. Because they bring in more gross than any other employees on your team, they must be at the top of their game at all times. Therefore, Atwood makes the following suggestion: “When the service advisor offers service and the customer says ‘no,’ then the advisor must immediately hand off the customer to the service manager.”
Atwood continues, “The service manager then explains the value of the service to the customer and why the technician has recommended it. This is done in front of the advisor to teach him how to make better sales presentations.”
Sharp advisors will only need to see this done two or three times in order to learn how to refine their closing technique. “If the advisor doesn’t have the desire or gumption to learn and apply the sales concepts he’s been taught, then he’s the wrong person for the service advisor position,” Atwood concluded.
Action Point: Invest time in your service advisors. Teach them how to sell. (If you, as their manager, can’t do it, then get one of your vendor partners to help. Or, if necessary, hire a third party to come in and train them. Sales training is not optional, it is the key to having a profitable service department.)
Atwood ended his workshop with one of the most powerful service sales closing techniques I have ever heard. He said, “When you’ve tried everything you know to do and the customer still won’t buy, say ‘Mr. Customer, would you agree with me that the work needs to be done?’ if they say ‘yes,’ then say, ‘okay, if you are not going to do it here, then would you please do it somewhere else as soon as possible?’”
This is an effective way to express your genuine concern for the customer and it lets them know it’s not about making the sale—it’s about doing the right thing!
Most of the time the customer will say, “Well, if it’s that important, then go ahead and do it!” Sold!
My personal thanks to Robert Atwood for passing along some pearls of wisdom from his 40+ years of automotive experience.
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.