Dealership service departments are in a bit of uncharted territory when it comes to customer expectations these days, says Juan Flores, senior director of product management at Kelley Blue Book.
For a long time, a customer would drive into the service lane and say to the service adviser, "Hey, tell me what I need," Flores says.
But times are changing, he says, whether consumers are shopping for a $1,000 refrigerator or a $400 brake job. They expect price transparency and price validation. What are they getting for that $400, and is that a good price?
Dealerships struggle with customer retention. Vehicle owners, especially within five years of when their warranty typically expires, tend to stop frequenting the dealership for service in favor of an independent repair facility.
"One of the primary reasons that they leave is they are under the assumption that an independent shop is less expensive than a dealership," Flores says.
Dealers with price transparency — on their websites and in their service departments — and price validation, through online tools such as Kelley's repair estimator, are able to demonstrate that they are competitive on cost.
Why some dealerships are more forward thinking than others when it comes to these two things is complicated, Flores says.
"Some dealers are very progressive. Some dealers are going to say, 'This is what the consumer expects, so I'm going to go ahead and meet them where they need to be met,' " he says. But "I think for many dealers, it's a legacy strategy. It's never been a need in the past.
"But the consumer research indicates customers expect to get a better sense of how much they should pay and why they should pay that amount."
