The National Highway Traffic Safety Administration has been tracking vehicle recalls since 1966. There were roughly 6 million vehicle recalls per year from 1966-1996 and about 17 million per year since then. Two major exceptions to this trend occurred in 1981 and 2004 when over 30 million vehicles were recalled. Of course, the mother of all recalls came just two years ago with over 44 million recalls. Let that sink in for a minute; in 2014, one out of every six vehicles on the road was placed on the recall list. Wow! No wonder shops and service drives got overwhelmed!
The reason I waited until now to write this article was because the automotive industry needed a chance to catch its breath. Now that recalls have returned to a more manageable level, it’s time to mine the gold from the opportunity staring you in the face when your manufacturer issues a recall. I know the problems—low profit or no profit services, unhappy customers, unhappy techs, congested service drives and phone lines, and a public relations nightmare—but today I want to focus on the opportunities.
Simply put, recalls get vehicle owners back in your dealership that might not otherwise return. Many “lost souls” that you haven’t seen in years, who long ago defected to the aftermarket, will show up on your drive. Some are motivated by safety concerns, some have a fear of losing warranty coverage, and some just show up because they want something for free.
Many recalls involve older, higher mileage cars that are out of warranty. Rather obviously, these cars need more preventive maintenance than new cars. It’s low-hanging fruit for the savvy service advisor and technician.
When a customer calls the dealership to set an appointment for a recall service, try this word track: “Mr. Customer, when you’re here for your recall service—which is free—our technicians will also be doing a thorough multi-point inspection on your vehicle. Are there any concerns about your vehicle that I need to make the technician aware of?”
“it’s time to mine the gold from the opportunity staring you in the face when your manufacturer issues a recall.”
Then, be quiet and listen. The customer will provide you with a wealth of information to help you intelligently prepare for their service drive visit. Obviously, you’ll want to get the vehicle’s make, model, mileage, and odometer reading. This data alone will give you a heads up on what additional needed maintenance to recommend. When you are armed with a list of their wants and needs, it will open up a wide door of opportunity.
Regardless of how the phone conversation has gone up to this point, wrap up with this: “Okay then, Mr. Customer, one last question: will you be getting an oil change while you’re here?”
According to Brian Allen, president of pistondata.com, 55% will say yes compared to only 20% if you wait to ask until they show up on the service drive. The reason is because those asked on the drive hadn’t budgeted the time for an oil change. Clearly, you won’t make much money on an oil change, but it is another opportunity to show the customer that no job is too big or too small for your shop to tackle!
There are many opportunities for you surrounding a recall, such as:
- Re-establishing lost relationships
- Establishing new relationships
- Creating loyal, lifetime customers
- Selling needed maintenance services!
Time out. Go back and look at the four items listed above. Which one is the most important? The most important is #4: Selling needed maintenance services. The first two (re-establishing lost relationships and establishing new relationships) are a waste of time if they don’t result in customer-pay revenue. Turning a recall service visit into maintenance service sales is not unethical, immoral, underhanded, or wrong.
Quite the opposite; if the customer needs maintenance work done on their car—maintenance that would prevent costly failure or catastrophic loss—then it would be unethical or wrong not to offer to perform those services while their car is in your shop!
If you want #3 on the list (loyal, lifetime customers), then you must earn it by giving them a great customer experience AND by offering all the maintenance services that the technician recommends on the inspection report.
Moreover, there is a sense of urgency to offer needed maintenance to recall customers on their first visit. Allen says if you do, then you stand a good chance of becoming their servicing dealer from now on. It just makes sense because candidly, if you don’t then there may not be a second visit.
If you want to prove this, pull some old recall ROs out of the file and see how many came for just the recall and nothing else. (In other words, they weren’t offered any customer-pay maintenance). How many of those never came back? Odds are that most of them never returned.
No upsells, no returning customers. How would you like numerous upsells, many returning customers…and many new revenue streams?
My personal thanks to Brian Allen for providing the service advisor word tracks listed above. They are simple, easy to learn, and powerfully effective.
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.