If your dealership is like most franchise and independent auto dealers in the US, the majority of your gross profit doesn’t come from the cars that are sold, but from the service and parts department. According to the National Automobile Dealers Association (NADA) 2018 , new vehicle sales represented about 58% of total sales, and only 26% of gross profit. In comparison, the service and parts department made up over 46% of gross profit for the majority of auto dealerships. So, while car sales keep people coming in the door, the service department is actually keeping the businesses afloat. This is why automotive service customer retention is so important and why using a solution like InTouch can help dealers generate more revenue.
The easiest way to maintain strong profits in the service department is to keep customers who bought cars coming back for oil changes, tire rotations and to replace belts, hoses and other parts when they wear out. But with so many choices out there, providing enough incentive for customers to continue coming back to the dealership for service can be challenging.
One way to incentivize people who bought cars from a dealership to come back for service is to provide relevant offers and discounts around the time that the service is needed. Getting the offer into customers’ hands at the right time is the key factor here. A deep discount on an oil change means little to a consumer who is still months away from needing one. Most dealerships have systems in place to reach out or mail customers service coupons after a specific period of time. However, most vehicle service needs are mileage based, so these discount offers are delivered according to how much time has passed and are based on guesses.
Getting A Coupon Into A Customers Hands Exactly When They Need Service is the Key to Improving Service Retention
Most modern GPS tracking systems offer the ability to accurately track vehicle mileage and report this back to the auto dealership. This feature allows dealers to reach out via phone, email or send service discount coupons to customers exactly when they need them. This timely communication increases the chances that customers will respond or schedule service.
PassTime’s InTouch is a GPS-powered connected car and theft recovery solution that gives dealers 3X ROI on their investment through lot management, F&I resale. InTouch is also a highly effective service retention tool.
InTouch can be pre-loaded on lot inventory or installed at point-of-sale and resold to consumers as a connected car and theft recovery system. One of InTouch’s features is that it can track mileage driven on the vehicle and be programmed to send alerts back to a dealership when a mileage threshold is met. Once a vehicle reaches the mileage threshold, an alert can be sent to the dealer and integrated into the dealer’s CRM system. The dealership CRM system can then trigger a coupon to be sent, an email or call to the consumer with a relevant service offer based upon the mileage driven.
In addition to GPS-powered lot management and an opportunity for resale through F&I, InTouch can also increase automotive service retention. With InTouch’s service tracking feature, dealers can contact customers for service reminders based upon actual calculated mileage, instead of simply guessing miles driven based upon a time period. Providing service offers at relevant times can increase a dealership’s customer retention rate and generate more revenue for the service department.