Canadian dealerships are boosting customer satisfaction, market-share, and per-visit cost, according to a recent J.D. Power 2020 Canada Customer Service Index.
The Long-Term (CSI-LT) Study reveals that dealers are improving service satisfaction, and increasing market share and per-visit cost for maintenance and repair of four to 12 years old vehicles — capturing 49 per cent of all service visits for these vehicles.
“Despite the challenges facing dealers and aftermarket service providers due to the pandemic, we’re seeing markedly improved levels of customer satisfaction this year,” said Virginia Connell, Automotive Research and Consulting Manager at J.D. Power Canada.
Dealers are also experiencing an increase in cost-per-visit ($375 in 2020 vs. $323 in 2019) compared with non-dealer facilities. The high cost-per-visit translates into dealerships capturing 60 per cent of service revenue in Canada (approximately $5.5 billion).
Auto retail is also experiencing a slight increase in the average number of customer visits (1.4 in 2020 vs. 1.3 in 2019), while non-dealer facilities have declined (1.5 visits in 2020 vs. 1.6 visits in 2019).
A key finding of the study reveals dealers are doing well when it comes to capturing returning customers for paid service, thanks to an increase in customer satisfaction while vehicles are still under warranty. In 2020, J.D. Power said 60 per cent of owners of three-year-old vehicles indicated they would definitely return for paid service — up from 53 per cent in 2015.
“This has helped dealers increase their overall share of service visits among owners of four- to seven-year-old vehicles during that same time period (58% in 2020 vs. 39% in 2015),” said J.D. Power.
Connell said vehicle owners are (and will be) holding on to their current, aging vehicle for a longer period, which translates to more repair opportunities for dealers.
“Considering that nearly 40 per cent of the auto service business for dealers comes from repair work, which is also a more lucrative revenue source than maintenance, dealerships should focus on improving all aspects of this service offering, mainly around service advisor and vehicle pick-up,” said Connell.
The study also reveals that dealerships and non-dealers combined, achieved an overall satisfaction score of 791 (on a 1,000-point scale) — up from 779 in 2019. Non-dealers averaged 795 while dealerships scored 788. However, dealers are overlooking two tasks that boost customer satisfaction: greeting customers immediately when entering the dealership/shop, and returning the vehicle cleaner than when it arrived.
J.D. Power said non-dealers do a better job of the first task (49% non-dealers vs. 35% of dealers, respectively), while dealers are more likely to return vehicles cleaner (38% vs. 12%, respectively).
On the overall customer satisfaction index ranking, Audi dealerships scored number one with 833 out of 1,000 points, followed by NAPA AUTOPRO with 827 points, Lexus dealerships with 810, BMW dealerships with 808, and Volkswagen dealerships with 806.
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