Software lets dealers update service customers via texting

For Ujj Nath, it was the service appointment from hell.

Although he had left his Honda Civic Hybrid with the dealership's express service staff, three hours later he hadn't received a status update. When he called the service department, the adviser he had met with was nowhere to be found.

When he returned to the dealership at the end of the day to pick up his car, he endured another 25-minute wait. And his bill didn't include the discount coupon he had presented.

Nath didn't settle for complaining. Instead, he applied his digital skills to develop and market software that helps dealerships communicate better with their customers -- at every stage of the service process, through payment -- via text messages.

Nath's company, myKaarma, now has 527 dealership clients. They include Norm Reeves Honda Superstore in Cerritos, Calif. -- where Nath had his bad service experience five years ago.

"Anytime you want to solve a problem, look at it from the customer's point of view," Nath told Fixed Ops Journal.

Texting is popular, fast and convenient. Yet by most accounts, few dealerships use it to keep in touch with service customers.

In this year's J.D. Power Customer Service Index Study, just 3 percent of the more than 70,000 vehicle owners and lease customers surveyed said they received text message updates about service work.

At the same time, 27 percent of customers with mass market brand vehicles, 42 percent of premium brand customers and 41 percent of younger customers said they want to communicate with their service adviser by texting, says Chris Sutton, vice president of Power's U.S. automotive retail practice.

Texting also does more than phone calls to build service-customer loyalty, the study suggests. About half of customers contacted by phone said they "definitely will" return to the dealership for paid service, Power says. Among those who get text updates, the rate rises to two-thirds.

"It is an untapped service," Sutton says.

Dealerships that are texting report big benefits in customer satisfaction and efficiency.

"It has improved the service experience tremendously," says Pat Hogan, general manager of Sellers Buick-GMC in Farmington Hills, Mich.

The dealership's service advisers have used texting for 21/2 years to get customer approval for repairs. With a phone call, that communication used to take as long as four hours. Now it's about 30 minutes, Hogan says.

The dealership just installed new texting software offered by CDK Global, a provider of dealer management system software in Hoffman Estates, Ill. Hogan says he especially likes the ability to attach a photo to a text message that can display a problem to a customer.

"We can show [customers] the oil leak is not all that bad, can tighten down the oil pan, and have that in history to determine if the leak is getting worse," Hogan says.

Even more, customers like getting a video of service work, says Michael Markette, president of CallRevu, a suburban Baltimore calling and customer service consultant to dealers and car companies.

Markette's company found that in the afternoon, when many service advisers try to reach customers, at least 15 percent of return communications were by text whether or not the adviser called from a landline phone. CallRevu360, one of his company's products, allows text replies to landline calls.

Robert Gabrielson, a service adviser at Weld County Garage Buick-GMC in Greeley, Colo., says most of his customers prefer to receive status updates via text.

His dealership uses a DealerSocket product called SocketTalk that allows advisers to text a customer via a mobile phone or computer. Gabrielson says he sends customers a text while they are in the service lane to establish initial contact. "It is quicker and more convenient" than phone calls, he adds.

DealerSocket promotes SocketTalk, part of the vendor's customer relationship management software, as a service lane tool. Yet few service advisers use the text function, says Marylou Hastert, Dealer Socket's director of product marketing.

When the vendor introduced SocketTalk in 2013, Hastert says, "the business need was more on the sales side." Service departments' use of the product is growing, she adds.

A reluctance to embrace texting with service customers could cost dealerships money. Fixed operations account for 11.7 percent of a typical dealership's sales, but 47.3 percent of its gross profit, the National Automobile Dealers Association calculates.

Poor customer communication remains the biggest obstacle for service departments to overcome, says Ken Barnes, sales director of DealerPro Training, a fixed ops consulting firm near Columbus, Ohio. Four of five service departments he works with don't communicate well, he says.

Communicating by text "definitely has value," Barnes says. "The customer at least is going to read it, and most of the time they will respond."

The J.D. Power study found a few auto brands, which it did not identify, that have more than 20 percent of their dealerships using texts to provide service updates. These brands encourage texting, Sutton says, because "it is more efficient for dealers, and customers respond positively."

More service departments may use texts than the Power study indicates, says Anu Roberts, a product marketing manager at CDK Global. The company surveyed 560 dealership customers two years ago. At that time, Roberts says, 90 percent reported that their service departments used texts.

But most of that communication occurred via service advisers' mobile phones. So CDK developed Text Connect, a service lane texting software product that allows texts to be sent and received from any Internet-connected device. Even if a customer texts a landline, the message will be routed through Text Connect. All of the information is stored on a centralized system.

"There were dealers saying: "My employees have these text relationships with my customers, but if they leave the dealership, that is gone,'" says Denise Olsen, a CDK product manager.

Text Connect and many other texting tools eliminate that problem by storing service communications on a central dealership system. For example, myKaarma preserves seven years' worth of phone calls and texts.

That record gives dealership managers insight into how a service department is performing, helps with compliance and provides a record when a customer questions whether specific communication occurred.

Such advantages create "a lot of useful tools from a manager's standpoint," says Karl Zerrenner, general manager at Volkswagen Pasadena in Pasadena, Calif. His dealership piloted the use of myKaarma.

Texting has boosted his service department's productivity by as much 20 percent because service advisers aren't on the phone all the time, Zerrenner says.

"A lot of people underestimate how much people like texting," he says. "We are used to doing the same thing over and over."

Cost may be one reason why texting products are not more widely used in service lanes. Prices vary widely depending on what services a product offers. Some cost $1,000 or more a month, others only $19.

And many are stand-alone products that won't work with a dealer management system, says Dave Sturtz, chief marketing officer of Dealer-FX, a customer experience management company in Markham, Ontario. The vendor offers a texting function in its new ONE Platform software for service departments.

Texting "is the preferred communication channel for a growing number of consumers," Sturtz says. "If that is where consumers are going, why wouldn't you want to meet them there?"

Dealership resistance to new technology may also be slowing adoption of text messaging, says Mark Trent, service manager at Seeger Toyota in St. Louis.

Even though his dealership has bought a texting software product, Trent says many of his service advisers still use their own phones to communicate with customers. He adds that he was a texting holdout -- until he tried it.

"I went from doing no texts to the point that I had to go to unlimited texting on my mobile phone plan," Trent says. "I didn't realize how versatile it would be."

He says he likes the permanent record and time stamp that a text creates as it shows an effort to contact a customer. If one of his employees will be late or is sick, he says, the communication "has to be by text, hence I have a record of it."

Advisers at Beck and Masten Buick-GMC North in Houston have access to a service lane texting product available from Xtime, a subsidiary of Cox Automotive. But few use it, says Roger Conant, the dealership's service experience manager. Customers often must initiate requests for communication via text, he adds.

"It is not a program we have jumped into wholeheartedly yet," Conant says. "We are going to have to position it with our customers in our dialogue with them."

Despite its apparently low penetration rate, texting is becoming a greater part of the service lane experience. Nath of myKaarma says he is testing a product called SmartAssist, which includes texts to speed service appointment scheduling.

The C.A.R. Group, which operates 14 dealerships in Southern California and on Florida's Gulf Coast, uses the myKaarma texting and payment systems at all but two of its stores. Chris Barthel, the group's fixed operations director, says he is preparing to introduce the appointment software at its Honda dealership in Irvine, Calif.

"Does that ever make sense," Barthel says. "Nobody wants to go online and fill out that page. Everybody loves to text."