Thursday, February 24, 2011

Just What Are They Thinking About? 2011 Carlisle Annual Service Customer Sentiment Survey

The 2010 Carlisle Service Customer Sentiment Survey probed into the attitudes and behaviors of Digital Service Customers (DSCs). In the process, we confirmed some suspicions and surfaced more than a few surprising facts. We always thought that younger vehicle owners were more e-Adept and less likely to use dealers for maintenance and repair. Well, we confirmed that. However, what was surprising was the magnitude of the consumer service research metamorphosis – fully one third of customers surveyed were DSCs, and the impact of internet research on service provider switching behavior was huge. Once folks go to the web for service information, they listen and act.

We are still processing this survey and will peel the onion even more at the Denver North America Parts Benchmark (NAPB) meeting in May (this is the 19th parts conference – we changed the name from North American Service Parts Conference – NASPC – to North America Parts Benchmark – NAPB). The first cut of the 2010 survey was input to the Cleveland Digital Summit that was held late in 2010. Of course, questions beget more questions. This next set of questions will be asked in our 2011 survey and answered in the next few weeks. Here’s where we are heading. What do you think?

Getting back to basics, we need to understand what influences customers to seek service in the first place?
  • Did they become aware of the need for service based on a mailing from a service provider? Millions of dollars are spent annually on these age-old postal mailers. Are we getting a bang for the buck here?
  • Did they receive a discount coupon in the mail or via the internet? Couponing is making a media transformation from paper cut-outs to web-based. Are we seeing a lot of action in this area? Are coupons effective?
  • Did they simply look at the odometer and miles since the last service and figure it out all on their own?
  • Was it from the really simple and basic stuff, like looking at a sticker applied to the inside of their windshield?
  • Or, did they get a service reminder call from their dealer?
  • Customers of GM products receive “OnStar” emails reminding them of service. Did this work?
  • Or, did the vehicle owner simply make a decision based on how well the vehicle was performing?
  • Completing the loop, maybe a friend, relative, or someone they trust told them they needed service.
Understanding how service decisions are made is pretty fundamental and easy to overlook. Common sense tells us that, hey, it just happens. Well, there are strategies at play here that cost hundreds of millions of dollars, and there are strategies that cost pretty much nothing.

Five years ago, in 2006, our Service Customer Sentiment Survey proved what customers really want – it came back to trust, value, cost, and convenience. Have things changed in the past five years? What do service customers want from their service provider? And, how well do dealers stack up? We’ve updated the lists that we use to probe with, pared them down, and will pose digital offerings that reflect evaluation behaviors of digitally savvy service customers.

How important are second lines of parts? What are the parts choices and are service customers made aware of them at the point they decide who’s going to service their vehicle? And, once they are aware of choices, what’s their expectation of savings on the repair order? This is pretty important. Dealers have a bad rap for being the high cost spread; they might be more competitive with more parts choices that can ratchet down costs and cost perceptions. I have been an advocate of second line parts for years now; fundamental to GM’s new Certified Service program is parts choices. It will be interesting to see how this plays out and if customer expectations of savings are realistic. By the way, this program really sings to me (take a look at the website – just Google “GM Certified Service”); it programmatically touches on many of the problems with repair cost that have been the bane of a dealer parts manager’s life in the increasingly customer pay world. Congratulations and good luck.

We all live by and off of “Genuine”, but how does it play in the market? Do customers understand what “Genuine” means? Do dealers explain it? More importantly, do dealers sell “Genuine”? We are going to ask service customers what they know and what they think.

Bottom Line: It is important to design research to test hypotheses – this is all part of the scientific method. Here are my hypotheses that we will test:
  1. I think that service customer needs have evolved during the past 5 years and that we will see more concentration in fewer basic needs.
  2. I think we will see this most dramatically manifested in younger service customers.
  3. I think we will see more customer needs that reflect current internet offerings – positive internet reviews of service providers, on-line estimates, on-line service scheduling.
  4. I think that service customers are generally unaware of the benefits and core differences that Genuine Parts offer.
  5. I think that service customers expect significant parts price reductions from aftermarket and/or second line parts … even though they are fairly naive about why Genuine costs more. (My theory is that they want significant discounts and feel that “non-Genuine” will provide the means for them to get these discounts.)
  6. I think that we will find that customers will not think that second line or aftermarket parts are good for all jobs. I think they will think non-Genuine is just fine for belts, hoses, brakes, and wipers … but not just fine for starting/charging, suspension, emissions, and fuel systems.
What do you think? Send me your hypotheses.

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