Dealers vs. Independents

There was a time in our industry when new car dealers and independent garages operated different businesses. Dealers sold the cars, performed warranty work and serviced a portion of the vehicles that their customers bought new. Everything else belonged to the repair aftermarket. No longer. Dealers have been after the all-makes all service business for years, but a troubling recent ad forwarded to me from Dieter’s Auto Service in Orillia, Ontario got me thinking about the nature of the dealer/independent relationship. The print ad from a Japanese OEM appeared in a local paper and implied that owners who take their cars to shops other than the new car dealer were “taking a chance”. While not naming specific independents, the message suggests that the gloves are coming off in this marketing battle for consumer loyalty.

In my opinion, this encroachment will only work if the independent aftermarket lets it. My theory is based on a few assumptions about our branch of the aftermarket. Assumption 1 is that we’re in the relationship business, not the repair business. A good shop’s reputation goes a long way to countering scare tactics from any source, be it competitors or the media. Assumpton 2 is that well-trained people with the right tools can perform any service task that a dealer can do with equal competence, although repair information lockout might be a factor here. Assumption 3 is that the consumer’s price for a given repair is similar, and possibly lower than the dealer price for a similar repair, for reasons such as special time-saving aftermarket parts and the ability to let the customer choose the level of repair and quality of parts they want. And finally, Assumption 4 is that we’re honest, so there’s nothing a consumer can find at their dealer that we can’t provide, meaning no five-o’clock surprises for our customer base. If these assumptions are true, then the best scare-tactic advertising can do is generate fear in the consumer’s mind, fear that can be assuaged by any good independent operator. Make them feel comfortable, be trustworthy, and they will be back every time.

If the campaign is doing damage, then countermeasures are in order. Talk to your local competitors and think about a group ad buy in the same media outlet that ran the dealer piece. Form an association of shops in your local area. Talk to your regional association or just call a couple of your competitors and alert them to the issue. It doesn’t have to be formal; getting together over a cup of coffee can go a long way toward pushing back against fear-based consumer advertising.

Of course, the key to making the counterattack work is to make sure that the assumptions above are true. If the consumer can get a higher quality repair from their dealer than from you, all bets are off. Maybe your best counterattack is to make your operation better, through training, equipment or both. Then let your customer base know that you’re continuously improving. Dealers are hungry for all-makes service, and they’re not going away. Raise the quality bar and act cooperatively to counter-market our services and we can protect our piece of the pie. If we fail to do this, we may just get what we deserve.