Digital retailing is a very valuable advancement for every dealer, but it is limited to customer acquisition alone. Is the auto retailing industry’s mission to sell a car or earn a reoccurring customer? If the latter is true, then why is almost every dealer digitally abandoning their customers after the point-of-vehicle-sale, where the digital experience associated to digital retailing abruptly ends? The answer is simple: Our industry is so focused on customer acquisition, many often miss the even greater revenue of retaining those customers with the same principles they applied to acquiring them. You’ve seen the statistics and surveys year after year. Most customers don’t like the car-buying experience, and many of them never return to the dealer after it’s concluded. Even with unprecedented profitability from vehicle sales today, are you OK with the status quo that leads to lack of loyalty and missed post-sales revenue?
Ask yourself, how often is your head in your smartphone? The same is true for every customer of every generation. This is no longer just a young person topic. If you're not making the digital connection with your customers, then you're not connecting with them at all in 2022.
Think about it, Amazon's transformative impact has little to do with their ability to sell something digitally one-time — there are legions of companies that can do that. Amazon's immense currency is because they've solved the customer's digital engagement before and after the sale, that keeps their customers coming back again and again. So, how far is the auto industry from delivering an Amazon-like experience? A solution exists that makes solving it just a leadership decision away.
Post Sales Revenue Touch Point #1
Business is built on relationships, right? And longstanding relationships are built on good communication. Phone solicitations, junk mail (postal and email), and random text messages are the primary communication attempts by dealers to inspire further engagement after the vehicle sale. Ask yourself, how do you respond to phone solicitations? How about junk email? Ever receive a text message from a phone number like 23-09? When it's random or junk, customers are minimally annoyed and most consider these types of communication attempts as fraud. It’s not if you’re trying to communicate with our customers, but how you’re communicating that makes a meaningful connection or not. By a wide margin, push notifications connected to stylized messaging on a customer’s smartphone is the most effective communication method, but few dealers are prepared or even understand how to implement it. If the dealer wants their customers to return for service, parts, purchase another vehicle, or refer a friend, they must communicate in a manner consistent with the way their customers want to be engaged. It's not rocket science.
Post Sales Revenue Touch Point #2
F&I is a critically important financial work center for every dealer. However, should the revenue potential of offering F&I products be limited to the time constraints of the F&I menu presentation alone? How many missed F&I products at the point-of-vehicle-sale would the customer have otherwise purchased if they simply had time to understand them or even if they were exposed to them at all? There are some old school attempts to offer customers F&I products after their vehicle purchase, but those are mostly littered with hard sell phone solicitations and junk mail. Again, the intent to sell after the point of vehicle sale isn’t the problem, it’s the archaic methods and processes being used. If additional F&I products were available to customers on their smartphone (driven by data that eliminates the spam that occurs when customers receive solicitations for a vehicle they no longer own), delivered in the same application where the dealer could communicate to them via push notifications, then a very powerful solution emerges. When the customer and their preferences are always evolving, the tactical error is believing solutions from 1985 are still relevant.
Post Sales Revenue Touch Point #3
One of F&I administrators' longstanding value propositions is customer retention, when F&I product service is needed. Our industry primarily leverages multiple administrator 1-800 phone numbers, phone queues with call hold wait times, and manual claim processing as today's support solution. Does that experience inspire retention in 2021? Ironically, it's the least desirable experience pathway for dealers — and their customers — and simultaneously the most expense support solution for administrators. How about a “fill-in-all-the-blanks” online claim form or an app that only works with certain F&I products or a single administrator? Each is an experience, just not a good one. Every dealer has multiple F&I administrators, so they can offer the best products, but the resulting disconnected service maze for the service advisors or customers is unacceptable. Everyday customers go to their dealer's service drive unannounced, seeking F&I product service support. Both the dealer's service advisor and the customer are unequipped to easily navigate this interaction. How many times does a service advisor learn about what F&I products the dealer is selling for the first time when a customer is standing in front of them requesting service from it? Multi administrator digital claims engagement (in one application) is an overdue pathway to simplifying F&I service, improving data accuracy, eliminating the time-consuming call center approach, and delivering a positive experience that actually promotes retention. Imagine if every F&I administrator had their own menu, where the dealer would present multiple F&I menus to their customers. Ridiculous right? Shouldn't the service experience be unified like the sales menu? Service horsepower is sales horsepower.
Post Sales Revenue Touch Point #4
How many digital pathways will a customer successfully engage with their selling dealer after the point of vehicle sale? The only realistic answer is one. Our industry must look at digital dealer-customer engagement from the customers’ perspective too. Will the customer download or engage divergent digital pathways including one F&I administrator's online claim form, another F&I administrator's separate app that only does tire and wheel, a dealer's rewards app that has no association to any other connected solution, etc.? It’s a ridiculous assumption and an out of touch tactic to believe they will. However, it’s exactly how our industry solves problems, in tiny, disconnected pieces. A rewards program to incentivize customer loyalty is incredibly smart, but it will only work when it's in the same application where the customer can see all their purchased F&I products in one view (even when they are powered by multiple administrators), and where they can also purchase missed F&I products and additionally digitally engage with their dealer.
Digital engagement and a customer’s experience is where business is earned, retained, or lost in 2021, and it shouldn't end at the point of vehicle sale. Think digital lifecycle, beyond digital retailing, to enhance the dealer experience. A solution already exists to solve this massive revenue blackhole and customer experience vacancy. Leaders are delivering “what’s next” before their competitors even embrace “what’s now.”
Steven Apicella is CEO of Strategic DX, Inc., home of Your Dealer Experience.