Think about the value propositions most dealerships present to consumers. Free car washes, fast transactions, oil changes, low prices, etc. They’re all so similar that, in reality, they cease to differentiate one dealer from another. The simple fact that they aren’t unique just about negates the offer for consumers when they consider who to buy from.
Nobody cares which Wal-Mart to shop at because they all have the same value proposition, low prices. So what kind of value proposition could a dealership come up with that would help dominate the market over their competition?
The answer may surprise you. With today’s recall crisis being top-of-mind with consumers, how about guaranteeing that every car you sell is recall free? AutoNation recently implemented just such a policy and has been met with both media and consumer applause.
The reality is that nearly 1 in 5 vehicles on the road today has an open recall. And it gets worse – most drivers aren’t even aware that their vehicle has an open recall, and in many cases, if they are aware, the dealership doesn’t have the parts to fix it.
However, I can guarantee you that any customer going into a dealership – whether it’s a franchised dealer or an independent – is expecting to get a vehicle that’s been inspected, runs well and has no recalls. Therefore, the lack of any recall is just as compelling a selling feature as a vehicle warranty, for example.
Customers want peace of mind when buying a new or pre-owned vehicle. If you sell a vehicle with an open recall which the customer then immediately has to take into an authorized dealer service center to get fixed, the customer can feel as if they have been sold a defective product. This will increase the likelihood that they are unhappy with their purchase.
Some dealerships have chosen to ensure that customers are aware of any open recalls at the time of purchase — but is that adequate? If you go to the grocery store and buy a dozen eggs. Then find at the checkout counter that two are broken and the cashier tells you that you need to come back next week to replace the two broken ones, chances are good that you won’t purchase the eggs or, at the very least, that you won’t be happy with your experience and will defect to a competing store for your future purchases. Sounds a little ridiculous in this example, right? But think about it. The customer EXPERIENCE is not that different at that grocery store to what happens when you sell a vehicle with an open recall at your dealership. The customer perception of that experience and desire to do business with you in the future would be the same. You might even argue that, due to the amount of the consumer’s financial investment, the quality standards for a vehicle are substantially higher than that of a dozen eggs.
The “No Recall Guarantee” isn’t an easy guarantee to offer. It involves paying attention to each vehicle on a regular basis while in inventory, not just when you dealership first acquires it. The vehicle could have no open recalls when you first acquire it, but perhaps one is issued while in your inventory.
There are many times when you should check for recalls. For instance, in my last blog, I talked about the importance of checking for recalls at auction so as not to purchase any vehicles with open recalls, which helps decrease the number of units in inventory with open recalls.
It takes some work and a steadfast commitment to a reliable and accurate solution. However, the most valuable unique selling proposition any dealership can offer its customers is full confidence that any vehicle they purchase and drive away in is safe. To do that, you have to ensure that none of the vehicles in your inventory have open recalls.
Consumers are bombarded daily with news about new recalls. This is top-of-mind for them and a matter of huge concern. Consider implementing a no recall policy and telling your customers of this policy through all your marketing and by physically labeling your vehicles as such. You should find that this helps instill trust and confidence in your dealership while also increasing the value of the vehicle in the minds of your customers. This product confidence not only leads to increased profits, but also builds loyal and happier customers.
Embrace this policy and you could very easily find that your value proposition controls your market… and makes all of your competitors inferior when it comes to consumer choice.
Author: Chris Miller
Chris Miller is President of Recall Masters, a leading provider of automotive recall news, data, training, and communications. Privately held and based in the San Francisco Bay area, the company is dedicated to helping automakers and their dealers expedite the repair of recalled vehicles and make the roadways safer for everyone. Christopher has more than 17 years of experience building software to automate marketing communications. He has worked with marquee brands including HSBC/Household Automotive, Washington Mutual, Residential Pacific Mortgage, ServiceMagic, Monumental Life Insurance, Mercedes Benz USA, BMW/Mini North America, Volvo North America, JP Morgan Chase, Wells Fargo, Moxy Solutions, and Costco Automotive Group.