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How Dealerships Continue to Improve the Customer Experience

Posted by James Thompson on Jan 5, 2022

Consumer expectations of the customer experience were redefined with the unprecedented access to information the internet provides. High levels of customer service, transparency, and communication became the minimum standard when interacting with dealerships. Out of necessity, due to the constant change in consumer retail behavior and expectations, the automotive industry has historically been a breeding ground for innovation. For example, the car buying process has changed drastically from as little as two years ago due to the pandemic and younger customers becoming the largest demographic in the market to buy a car.

The vehicle buying process has a lot of touchpoints that make it challenging to adhere to the constantly changing local, state, and federal requirements to minimize contact. One of the most important steps in the customer experience during the buying process is the test drive. The customer feels the experience of driving the vehicle and they often make their decision to purchase based on this drive.

So, has the pandemic changed how automotive companies invest in research and development or the entire customer experience?

Research and Development Funding

Before the pandemic, the U.S. automotive industry was spending approximately a billion dollars on new research and development (R&D). A 2021 IHS Markit global automotive research and development survey says to expect growth and greater confidence in R&D spending, despite setbacks due to the pandemic such as supply chain of semiconductors being disrupted. Automotive companies, on average, saw about a 6.5% increase in automotive R&D spending in 2021.

Almost half of the companies that responded to the survey will spend more on software and developing software-related features. Following software at 36% is vehicle electrical architecture development. Compared to other domains, the e-mobility domain is likely to experience a higher R&D investment, compared to other domains.

A little over one-third of the automotive companies responding say they will invest their R&D funds to hire software professionals while one-fifth of the respondents plan to hire test and integration professionals. These areas of innovation are clearly a priority for the automotive industry.

Ultimately this means that automotive companies are continuing to focus on using technology as the tip of their spear to enhance the customer experience. Improvements will take service and sales experiences to the next level with increased innovation of online tools and digital platforms that create an effortless and convenient customer experience.

How Customers Want to Shop for Vehicles

First, it’s important to review how the pandemic has affected vehicle shopping and purchasing. According to a Deloitte study, the pandemic did not affect 66% of the respondents’ plans for buying their next vehicle or which type.

By a large margin, people still prefer to buy their next vehicle in person. Out of the almost 30% who want to shop for a vehicle at least partially virtual, almost two-thirds want to buy their vehicle from an authorized franchised dealer. The main reason given for shopping virtually is convenience but it’s not a surprise that 71% of U.S. consumers want to see the vehicle and test-drive it.

A Cox Automotive Future of Digital Retail Study states 83% of respondents want to do one or more of the steps of the buying process online and that time ranks lowest in customer satisfaction as customers say working the deal takes too long. Thus, dealerships need to review their processes to ensure they minimize their customer’s time and train their staff to be valuable specialists as well as consultants for their customers.

When customers can do some of the car shopping process online, they save an average of 30 minutes. The Cox Automotive report recommends.

  • Provide information about the deal online.
  • Avoid forcing customers through a set sales process.
  • Allow customers to review and sign in person.
  • Have dealership staff continue to help customers.
  • Keep the test drive as this is a must-do.
  • Invest in a hybrid online and in-person solution.

Here are three ways to improve the customer experience while streamlining your processes.

1. Utilization of a Customer Relationship Management System

Enhancing the customer experience is driving innovation because it’s everything for customers in the car shopping process. A Deloitte global automotive consumer study has found that almost 80% of those surveyed rank the customer experience as a “somewhat important” or “very important” factor in deciding where to buy a vehicle.

The concerning part is that almost half of the respondents were never contacted by the manufacturer after buying their vehicle. And 22% say the dealership never contacted them. These are missed opportunities. It’s critical to get this feedback to ensure the customer experience is right. Taking advantage of every opportunity to provide an excellent customer experience will keep the customer coming back for service and future purchases.

A customer experience does not end with the customer driving off the lot with your vehicle. They need maintenance and services performed on their vehicle. They will eventually want, or need, to replace their vehicle with a different one.. A dealership customer relationship management (CRM) system will help make sure leads or opportunities to interact with a customer are not lost.

A CRM can also work with your website and keep track of leads. Employees can communicate with customers via text messages, emails, and phone calls streamlining the tracking process and preventing leads from disappearing. The system can help you fill your pipeline and keeps customers moving through the customer experience with consistent targeted messages.

A cadence of following up with customers who bought a vehicle from you, who may need service and maintenance or who may be in the market to purchase a new or used vehicle, increases customer retention. Marketing to vehicle owners in your market who did not purchase a vehicle from you, that may need service and maintenance or that may be in the market to purchase a new or used vehicle, will increase new customers into the dealership driving increased revenue.

Some CRM systems can provide reports with data on individual sales rep performance, list leads in order from most likely to buy to least likely to buy, helping to focus staff training and marketing efforts in the areas that will provide the greatest ROI on your time and investment.

2. Utilization of an Inventory Management System

Another system to utilize that saves time and boosts the customer experience is to utilize an inventory management system like TRAXx. TRAXx uses smart beacon technology to quickly locate a vehicle based on specific or zone-based mapping of the dealership lot reducing the risk of key swapping and key fob mirroring.

To find a specific vehicle, the employee opens the app and the vehicle’s location instantly appears. In addition to increasing security, it reduces the time spent on searching for the right vehicle. shortening the customer wait time while maintaining high customer service levels. In turn, an improved customer experience.

Dealerships with remote video surveillance can also integrate their inventory system with TRAXx for extra security.

3. Invest in Remote Video Surveillance

Unlike most traditional security systems, remote video surveillance does more than act as a security deterrent. Partnering with the right security company can increase your team’s productivity levels. A more productive team leads to an improved customer experience which leads to increased sales across the dealership.

For example, Stealth installs security cameras strategically around your property to capture how customers and salespeople move around the dealership lot with video monitoring and retrieval services. These services can spot gaps in the customer experience for management to close.

Video monitoring identifies customers waiting too long for a salesperson to engage with them and helps you decide the need for more or fewer salespeople working at certain times of the day and day of the week. Remote video surveillance can help you make informed decisions while improving the customer experience.

Dealerships that serve customers faster and more efficiently will provide a better customer experience. Customers will come back when their vehicles need servicing, or they want to shop for a new vehicle. Other security systems don’t find opportunities to increase sales across the dealership like security cameras can.

Remote video surveillance is a proactive solution that has eyes across your dealership. It can maximize security of your property, assets, and – most importantly – your customers. Trained monitoring operators use analytics-based cameras to maximize security and help stop potential problems before they happen.

Video surveillance helps protect your dealership from false claims while continuing to provide an improved customer experience. When customers claim the dealership damaged their vehicle during a maintenance or service visit, video recordings could provide clear evidence if the damage existed when the vehicle arrived in to service or if it happened while the dealership had possession of the vehicle. This evidence helps mitigate potential customer dissatisfaction that would have occurred due to a misunderstanding of who caused the damage and help protect the dealership from unnecessary expenses.

It’s hard to win liability claims without proof. Anytime there’s a liability claim against a dealership, dealerships with video surveillance should send their footage to law enforcement and insurance as proof they had nothing to do with the claim.

Your dealership can reduce expenses due to losses and theft with an investment in video surveillance. A positive ROI is typically realized within a few months. The security requirements for dealerships are unique compared to other businesses. Working with a company that has the right experience in implementing an effective video surveillance system for your dealership can help maximize your investment.

To learn more about dealership security, pick up your free copy of Four Auto Dealership Theft Trends and Their Side Effects. Please feel free to contact us with your questions.