J.D. Power’s recent Automotive Analyst Note, ‘The Seven Year Itch,’ points to how important one’s experience with vehicle service is in making crucial buying decisions. The note penned by J.D. Power analysts Virginia...
J.D. Power’s recent Automotive Analyst Note, ‘The Seven Year Itch,’ points to how important one’s experience with vehicle service is in making crucial buying decisions. The note penned by J.D. Power analysts Virginia Connell grew out of J.D. Power’s annual customer satisfaction survey looking at Canadians’ experience with vehicle service amongst dealership service operations and independents.
Connell’s note points out by the time a vehicle reaches seven years of age, dealership service operations retain “only half of all their possible on-brand service occasions.” Dealership operations have placed a great deal of focus on improving the experience with their service operations as “dealers have realized that they are not going to be making money on just selling cars, especially with the profit margins where they are at now,” adds J.D. Ney, supervisor of the Canadian automotive practice with J.D. Power in Toronto.
One of the interesting findings that came out of both the customer satisfaction survey and the analyst note is as dealership service operations and independents fight to get and maintain profitable service dollars, the quality of the service provided makes an important impact on vehicle buying decisions in the future. If a person finds they had few problems with servicing their vehicle, that service experience will influence the decision on purchasing the same brand or model of vehicle in the future. Dealerships now see the service operation as a “secondary sales department,” Connell notes. “A 10 out of 10 dealership service experience generates repurchase intent at the dealership 3.1 times higher than when a service is rated 8 or 9.”
Connell delved into the numbers a bit deeper and discovered that “among owners of 4-7 year old vehicles who have serviced their vehicle only at a dealership facility in the past 12 months, 79 per cent say that they ‘probably will’ or ‘definitely will’ re-purchase/lease from the dealership that most recently serviced their current vehicle.”
What does this mean for independents?
It has to be kept top-of-mind that the number of vehicles on the road today over six years old are more than what can be successfully handled by dealership service operations. Many will go to independents for needed service and maintenance work. There is a growing interdependence between dealerships and independents in ensuring that vehicle owners remain satisfied with their vehicle purchase. Many independents have long-standing, profitable relationships with dealership service and parts departments. Many dealership operations will often send service work to independents they trust.
The goal is to maintain the vehicle owner’s satisfaction with the brand. Vehicle owners who have a poor experience with the maintenance and repair of their vehicle will purchase a different vehicle make in order to avoid the poor service they experienced. Independents need to understand that the service experience they provide will be a deciding factor in a future vehicle purchase. People will come to them for advice and even recommendations for vehicle purchases based on the service experience and will decide whether to bring their new vehicle to them in the future.