Going Back in Time to Win Back Customers Who Have Defected

A Blog Post by Sean Reyes, Chief Marketing Officer for Recall Masters

We all have our stories of missed opportunities and wrong turns at the fork in the road. Had I stayed working at the County of Los Angeles, I’d be retired by now at about 125% of my salary. Had I just evaded that tackle and scored the winning goal in the state title game, maybe I would have received that scholarship offer from UCLA and gone to play in Europe. Should’ve, would’ve, could’ve. These aren’t just tales from a middle-aged man whose days on the pitch are long past him, but are also the regrets of thousands of dealers who largely ignored a determined strategy around retention. The difference is, dealerships have a unique opportunity to restore relationships with customers who have long since defected to the aftermarket.

No – time travel is still not possible. What I’m talking about is vehicle recalls. By all market definitions, recalls aren’t the best way to make an entrance into a vehicle owner’s world. However, recalls aren’t anything new or exclusive to your brand or to consumers. In fact, in a recent consumer survey conducted by Recall Masters, 49.3% of vehicle owners view recalls in a positive light, characterizing them as a means of promoting safety. In total, 87.8% of consumers felt that recalls are a natural by-product of the manufacturing process. These results don’t suggest that recalls aren’t also considered an annoyance and a key factor in brand assessment, but they aren’t the next pandemic.

Since NHTSA and OEM voluntary recalls (TSBs) can only be repaired by a franchised dealership of that brand, they also present an opportunity for dealerships to reintroduce vehicle owners to dealership servicing. This safety-related incident not only carries goodwill in the name of risk mitigation, it also comes at no cost to the vehicle owner. It’s no secret that there’s a significant drop-off in dealership servicing once the vehicle is no longer under warranty. And, we’re almost doing to ourselves by not being competitive or convenient with tire sales. There are many in the industry that suggest that customer defection happens right about the time that a vehicle needs its first set of replacement tires, coinciding with warranty expiration.

Only about 8% of tires sales come from the dealership. So, when dealerships are not considered a resource for tires, we invite vehicle owners to visit an aftermarket provider. But it’s not just for tires. In many respects, retail auto care uses tires as a “lost leader” to win customers into a servicing experience that can uncover other opportunities like brake service, tire rotations, battery sales and other light work. It’s a model that has fueled countless competitors, most of which can be seen with proximity of the dealership. They pick up our crumbs…and we let them. Along with older, out-of-warranty vehicles that are purchased in the secondary market, franchise dealerships are missing out on a significant piece of the $825 billion auto repair market.

Recalls cut through the consumer’s perception that dealership servicing is expensive, inconvenient and a breeding ground for upsales and unnecessary work. As it turns out, the vast majority of Americans think car dealerships are out to rip them off. In a KPA 2024 Dealership Trust Survey of consumers, results reveal that about 76% of vehicle owners still don’t trust that dealerships are being honest about pricing. The lack of trust and transparency amidst current economic conditions leaves a distasteful perception for consumer who consider soaring car repair costs as a growing burden. The survey also suggests that nearly 9 of 10 of consumers believe they’ve been overcharged or may have been overcharged at one time, and more than half say they’ve probably paid for a service they didn’t need.

Recall repairs present an opportunity to reshape these misconceptions, but only if dealers go out of their way to win back these consumers. Here are a few rules to follow:

• Establish a “recall hotline” and Recall Check solutions on your website. Simplify the process for consumers to check their vehicle for an open recall and, if they uncover a recall(s), to schedule a repair appointment promptly.
• Roll out the red carpet for vehicle owners affected by a dangerous recall. What amenities does your dealership offer to offset the annoyance and inconvenience of an open recall?
• Leverage pick up/drop off and mobile services where available. Recalls qualify for warranty reimbursement at retail rates for parts and labor in 49 states, so they actually can be profitable work for dealerships. Average RO amounts for Recall Masters customers are currently $693 across all brands.
• Approach additional servicing opportunities with caution. Many consumers believe that dealership service advisors simply want to upsell products and solutions that are not necessary, characterizing recalls as a “trap” to bring vehicle owners back to the dealership.
• Treat them right and 58% of these vehicle owners will opt for additional CP work.

You represent the brand. While your dealership brand didn’t create the recall, the average consumer doesn’t understand how your store is NOT an extension of the OEM. Always apologize for the inconvenience and deliver a heightened service experience that is inviting for consumers. This is your store’s chance to show vehicle owners what your store is all about. You’re not going to win over 100% of these consumers, but you want to plant doubt in their minds that servicing with aftermarket providers is their only option. While price is always a consideration, it’s not the most important variable for a vast majority of consumers. Convenience is first and foremost. Remain competitive with all services and products, provide thorough MPIs, deliver on amenities that make servicing with your store preferable and serve as a trusted advisor in vehicle care. Everyone wants a trusted advisor in the car business – be that professional.

About the Author

Sean Reyes Chief Marketing Officer sean@recallmasters.com

Sean Reyes oversees all marketing efforts at Recall Masters as Chief Marketing Officer. Sean also serves as the host of the FixedOps UX, a “minicast” that revolves around the fixed operations ecosystem and the tactics that build a better user experience for customers, dealership staff and other stakeholders. Sean’s experience spans more than 35 years of business development and strategic marketing experience, having developed go-to-market products and solutions for the automotive, healthcare, insurance, finance and technology industries to serve Fortune 1000 clients like American Express, Toshiba, Western Digital, Cox Communications, Novartis, Microsoft, IBM, Compaq, HP, National General Insurance, MyCustomer Data, DigniFi and several automotive affiliates and dealerships. Sean lives in Napa, CA with his wife Kathryn and spends his free time hiking, kayaking, playing guitar, going to concerts, rebuilding project cars and helping his kids embark on adulthood.