Recall notices are not, for most dealers, the first place they think of when it comes to generating revenue. Yet, how a dealership responds to recalls can create a distinct opportunity: an opportunity to demonstrate a customer-first attitude and the full value of your services, opening the door to possible increased business.
There are roughly 270 million vehicles on the road in the United States1, and of that number, over 63 million are under an open recall2 – just over 23 percent. Unfortunately, with the frequency and large volume of recalls in recent years, vehicle owners are responding at troublingly low percentages. Even life-threatening airbag recalls are only being resolved 47 percent of the time.3
The purpose of the recalls is to correct a safety issue – and that should remain the main focus for dealers handling recall repairs. At the same time, when customers do come into the dealership for these repairs, you have an opportunity to not only handle the job at hand as efficiently as possible, but also to demonstrate the full value of your dealership’s Service capabilities in a way that moves the customer closer to a purchase decision.
If manufacturers’ notices are failing to bring in even half of customers for the needed work, what steps can you take to set the right tone and create that opportunity for your dealership?
Take the Lead: Send Your Own Recall Mailers to Your Customers
Manufacturers send notices that instruct owners to visit any local dealer, emphasizing customer choice and convenience. Dealers can take the lead in pulling customers into their dealership by sending mailers with your dealership name and contact information featured prominently.
This is an effective way to bring these customers in for repairs; however, not all recall mailers are created equal. Make sure you use appropriate, attention-grabbing designs and consolidate multiple recalls attached to the same VIN. Also, work with your legal counsel to be sure you are following legal and manufacturer guidelines.
For example:
- Use the right list to target customers with open recalls – and only those with open recalls.
- Use the recall description instead of a generic reference to “a recall,” and don’t use language or graphics that have a tendency to alarm customers or imply vehicle issues that don’t actually exist.
- Don’t include offers that require a purchase or violate privacy laws by including too much customer information.
Also, consider additional services that your dealership may provide to alleviate those points of pain that prevent customers from completing recall repairs. In 2017, 37 percent of customers said they didn’t have recalls completed because they had difficulty giving up their vehicle while it was repaired.4 Complimentary shuttle service and complimentary loaner vehicles are possible ways to address these concerns.
For those customers who don’t respond to the mailer, follow up with phone calls to increase the success of your recall campaign.
When They Come in, Demonstrate your Full Value
Once customers do come in for recall work, focus on the recall repair first and foremost. Next, demonstrate the value of the total experience with the dealership and not only the recall repair.
Coach your service advisors on the value of recall appointments and advise them to both perform free multi-point inspections and not shy away from recommending additional services. With the average age of the vehicle fleet up to 12 years in 20175, it’s not uncommon that a thorough inspection will turn up some legitimate issues in need of attention.
The benefit of offering additional services is clear – 47 percent of customers agree to additional service work when recommended by their advisor.6
Demonstrating your full value of the Service experience and expertise at the dealership is one more way to win over a recall customer as a repeat service customer and create new revenue opportunities – increasing customer pay business in your Service Department.
Conclusion
Be proactive in bringing in customers for needed recall repairs, then use that opportunity to demonstrate a customer-first attitude and the full value of your services. Done right, this approach to recalls will turn into increased customer loyalty and increased revenue potential in your Service Department.
About the Author
Chuck Havener is the Director of Marketing for Reynolds Document Services at Reynolds and Reynolds. Havener has more than 15 years of experience serving the automotive industry. His teams are responsible for the product management, marketing communications, compliance and pricing functions for the Reynolds Documents business.
1 Statista
2 CARFAX
3 Forbes
4 University of Michigan
5 Bloomberg
6 J.D. Power