Friday, July 15, 2011

Just Who Are You Anyway? Focus Group Learnings on Emerging Digital Service Customers - David Carlisle

Preface: Since 2006 we have been probing into attitudes and behaviors of our motor vehicle service customers. In 2010 and 2011 we surveyed nearly 13,000 service customers. The past two surveys started to focus on Emerging Digital Service Customers (EDSCs). They represent about one-third of the current service customer base and are growing rapidly like a virus in a Petri dish. The surveys were like X-rays; they provided us with a snapshot of these customers, but offered limited dimensionality. We needed to talk to these EDSCs. So, this summer we are conducting 10 focus groups. The next group is next Tuesday at 6:30 PM, when we will be talking with young mothers. We are 40% of the way through this process and here’s what we’ve found. NAPB members can sit behind the mirror and eat pizza with us if they have the time. Call Jess.

There are some pretty brilliant service parts executives out there who know just about everything. Sometimes I envy them. I have always taken a certain measure of pride in my ignorance … coupled with the ability to figure important stuff out. In my training book, “Handbook for the Recently Hired,” I talk about thinking dumb and unlearning. This comes in handy…real handy when listening to our weekly focus groups of EDSCs. Just who are these people, anyway?

EDSCs are 22-32 years old and have almost no brand loyalty. I say almost, because three brands – Honda, Jeep, and Subaru – seem to arouse passion; other brands are white refrigerators. Our focus group EDSCs are all college educated and seemingly have good jobs. But, money is very tight. It will probably be tight until they are senior citizens – we are in a prolonged post-boom period and things have changed here in the states. Male/female car maintenance role models have evolved; men are just as clueless as women were thought to be in the 50s. Sexism is still alive, but it has gone underground. It is largely irrelevant, but still annoying, to today’s educated female. This customer base is our legacy; baby boomers are very, very different and dying out.

EDSCs generally don’t read print media, “People” and “Us” excluded, unless their parents give them their magazines. They get their information online from customizable news and information aggregation sources like iGoogle. They love coupons and specials; they comb the internet looking for them. They rely on Yelp and Google for reviews and actually take the time to read them, because they distrust the star ratings. They read these reviews carefully, as if they were movie reviews crafted by Manohla Dargis.

EDSCs depend on “My Guy” for advice regarding vehicle maintenance and repair. “My Guy” could be a local mechanic who has won their trust, their dad, or another knowledgeable relative. They generally follow the instructions of “My Guy” unless they have reason to do otherwise.

EDSCs generally don’t trust dealers because of up-selling during common maintenance and aggressive free inspections that resemble police interrogation rooms in the Bronx. Jiffy Lube, other chains, and IRFs do the same, but dealers are held to a different standard – I call it “guilty until proven innocent.” EDSCs have inherited knowledge that dealers are more expensive and they always, always, cite labor rates to prove their point. It is unknown or irrelevant to them that many IRFs now have nearly as high labor rates. Fundamentally, EDSCs really do not understand the role of the dealer and the processes that the dealer uses. Not surprising, because these processes were designed by 50 year-old corporate men who think that these processes make great business sense for the dealer, fixed operations, service training, customer management, sales, marketing, pricing, finance, product development, field organization staffing roles and responsibilities, … and, well, golly, of course, the customer. This does not mean that AutoMD and RepairPal will be the winners because of better processes and newer approaches. RepairPal made a fatal mistake by replacing David Sturtz with finance geeks; David knew what he was doing, but the money wasn’t there. AutoMD is really out to sell parts … to folks who don’t use them. They are off-market. Go figure. All this reminds me of “Gone With The Wind” – Clark loving Viv with all that fire in the background.

EDSCs who really do love their Honda, Jeep, or Subaru dealers talk unabashedly about how they will switch out of dealer service once they are out of warranty. They have already abandoned the dealer for LOF maintenance due to cost and convenience issues, whether real or perceived.

EDSCs generally do not know how often to get an oil change and depend on the sticker in their windshield or their car’s oil service reminder warning. They don’t know how to reset the service reminder because they do not read the owner’s manual (after all, most manuals are printed and not digital). They generally have no idea what synthetic oil is and whether or not they should use it. EDSCs explanations of “genuine” parts are amusing – or frightening from the OEMs’ perspective. Aggressive IAM advertising and misappropriation of certain terminology has led them to believe that they get genuine parts from NAPA, AutoZone, Jiffy Lube, Goodyear, and their local “My Guy”. Are “genuine parts better?” It’s hard to convince them that anyone would put a bad part on their car.

EDSCs say that safety is a big factor when selecting the car they drive. But, when asked about parts safety, they say, “I have never thought about that.” They distrust big car companies because of past violations – they cite Toyota’s recalls in particular. They still love their Toyotas, but are not so passionate about the brand. They have divorced the product from the company. Ford, Chevy, and others are generally in the same boat as Toyota.

EDSCs read headlines, but will only click on something that shakes their beliefs and/or is about their specific make or model. They are very careful with their clicks, as if clicks were in short supply. They are extremely cynical and sensitive to OEM propaganda in any and all media. They can’t imagine a good reason for going to an OEM’s website unless it was to look at new cars.

Bottom Line: We identified some of the characteristics of EDSCs through previous end-customer surveys, but these focus groups have added a third dimension to a formerly flat picture. Unfortunately, the picture is rather bleak – EDSCs are entirely uneducated about genuine parts and suspicious of dealer service due to cost and trust concerns.
Timeout: This is the next generation of service customer that we are handing off to our next generation of corporate aftersales management to handle. This legacy is not unlike the riddle of national debt that our politicians are handing off to today’s 20 and 30-somethings. The easy thing to do is to deny their existence, and then take early retirement. I certainly would not want to be 55 years old and stuck with this customer base and today’s dealer processes. Can’t tweak the system enough to get through this one.
It will be an uphill battle to change EDSC attitudes and, consequently, their behaviors, but it is imperative that we find a way. A successful approach will target these customers with relevant, click-worthy content that challenges their beliefs using facts and data. Our task over the next few weeks is to figure out exactly what content fits this bill.

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