DO THE SEPARATE WORLDS OF SALES AND SERVICE IN THE DEALERSHIP ACTUALLY WORK AGAINST BETTER CUSTOMER RETENTION AND LOYALTY?
Over many years of studying consumer behaviour in the auto industry, there are probably five key things I have seen that are consistently associated with organisations or brands with high levels in customer retention and satisfaction (in both sales and service).
1.The customer’s perception of the honesty of sales or service personnel in the dealership
2.The level of transparency perceived by the customer
3.The level of respect shown to the customer (regardless of age, gender)
4. The ability of dealership personnel to truly listen and pay attention to the customer’s needs
5. The ability of dealership personnel to keep things simple for the customer, even if underlying processes and policies may be complex
These are all components of trust and in today’s world, trust is probably the single most important part of building an ongoing relationship with a customer. Apart from being very evident in the automotive business, they also hold true in industries such as retail banking, insurance, travel and telecommunications.
In the dealership context, where the sales and service functions have traditionally been separated, it’s interesting to ask the question: who can really drive customer loyalty best? I suggest that one of the factors to take into account is who the customer knows and trusts most in the dealership.
FLEXIBILITY IS THE KEY
I recently came across an article from the American Marketing Association’s Journal of Marketing (January 2012). The article is called “Generating sales while providing service.”
The research for the paper was done by three high level business academics and practitioners from Maastricht University in the Netherlands (Jasmand, Blazevic, de Ruyter). I found it interesting because it addresses this issue head on and, even though they were studying a CSR type situation (likely taking place on the phone or online), it has relevance, because it provides great insight into the psyche of a customer as well as the employee.
Reading the paper, it’s clear that it is not just as simple as giving customer service people some sales objectives and vice versa. There are implications for hiring criteria, business process and internal culture. Here are some of the key findings:
• Employees with a strong “locomotion orientation” (those with a desire for action and acceptance of change) are more likely to adopt “ambidextrous” behaviour (see opportunities beyond their core responsibilities) in their pursuit of multiple service and sales goals;
• A combination of this locomotion orientation and an “assessment orientation” (the desire to take all the facts into account and to find the best solution) leads to enhanced willingness to pursue multiple goals;
• Two factors can potentially weaken or put the brakes on ambidextrous behaviour — overly strong team orientation and the strong exercise of “bounded discretion” (too many rules);
• Ambidextrous behaviour is positively correlated with both customer satisfaction and sales performance
They also noted three other things:
• Cross-selling requires “dealing more intensively with customers, listening more closely and acquiring a deeper understanding of (the customer’s) needs and experience.” (This is exactly what customers keep telling us they want.)
• High levels of cross-selling “augment the effect of customer service provision on customer satisfaction” (increase the perception that the employee is truly customer oriented);
• An “assembly line” mode of dealing with customers leads to lower perceived quality of service.
Some of this may sound academic, but I am sure we can all relate these findings to experiences we have had with service providers, hotels, retail stores and others. The findings are also very much in line with the hundreds of customer experience studies I have conducted and analyzed over the years. They also underscore the five key points made at the beginning of this column by focusing on the impact of behaviour that reinforces the customer’s perceptions of the competence, honesty and sincerity of the people they’re dealing with in the dealership.
WORKING TOGETHER
Clearly, service advisors in the dealership have a job to do and that should remain front and centre for them. Processes are important for quality and consistency. The same applies to sales consultants. But there are opportunities for much closer integration of the goals and processes within these two main customer-facing components of the dealership.
At the CADA summit in February this year, we heard from at least two dealers who are trying to break the traditional mold.
One very simple idea (that costs nothing or very little) is to ensure that the salesperson who sold the vehicle is alerted if the customer is coming in for service. Simple, intuitively correct and, while it won’t result in a sale every time, it cements the relationship with the customer and reinforces the notion internally that everyone in the dealership benefits when a customer buys a vehicle or services a vehicle.
The opportunities are there, and customers increasingly see their relationship with a service provider and their products as seamless. It’s time we took a good look at the structure and process in the dealership and question whether or not it is in line with better performance in customer retention and loyalty.
