By Sean Claessen
Full disclosure: I’m not a car enthusiast. Cars are a necessary evil for me.
But driving a car has never felt better. Features that were the stuff of science fiction not long ago are rapidly becoming standard as cars start to drive themselves, are controlled by voice, connect to your devices and profiles, and provide ever higher levels of performance, comfort and safety.
Contrast that to the experience of buying a car and keeping it running. When was the last time you had any fun doing that? The dealership is still a huge, empty showroom where you’re likely to be pounced on by a sales person intent on making their monthly quota.
And once you’ve bought the car, all the demands for time and energy fall on you to make sure it’s maintained, complies with recalls and gets the regular service needed to meet warranty requirements.
The auto industry is a glaring example of a sector that has become transfixed by its own product at the expense of good customer service.
The car ownership experience, as managed by dealers, needs to catch up to innovators when it comes to service. Starbucks /zigman2/quotes/207508890/composite SBUX +1.44% lets you bypass the coffee line by ordering through its app; Amazon.com /zigman2/quotes/210331248/composite AMZN +0.60% has the nation hooked on two-day shipping; Grubhub /zigman2/quotes/210404212/composite GRUB -1.02% , UberEats and Doordash have brought every restaurant in town to your door — and are even letting you mash up menus in their cloud kitchens!
It’s no wonder that barely 71% of car buyers rate their purchase experience as satisfactory and a paltry 30% remain loyal to their dealership’s service department after purchasing their vehicle. That’s crazy — more than two-thirds of customers leave within the warranty window!
The auto industry is a glaring example of a sector that has become transfixed by its own product at the expense of good customer service. It’s become perpetually focused on the sale, forsaking the experience of owning that car.
It’s been asleep at the wheel on this for decades, with a sales culture focused on the showroom, flashy offers of cash discounts, and hitting quota targets and commissions.
Not for much longer, though. All kind of industries are moving to make life easier and more convenient for customers across the entire journey — not only the buying journey — leaving the auto industry in the dust, by comparison.
Those industries are succeeding because they’ve recognized that our culture is putting a big premium on time and convenience. If people can see how a service eases their life in terms of time and hassle, they’re much more likely to choose it, but more importantly, stay loyal to it.
Even highly regulated industries are catching on to this. The banking industry’s previously stodgy and slumbery relationship with customers is being transformed by the spread of online and mobile services. The key word is service.
The auto industry has no reason to think it will be immune to this trend. Car sales are falling and the younger generations of consumers see Uber /zigman2/quotes/211348248/composite UBER -0.64% , Lyft /zigman2/quotes/208999293/composite LYFT -1.61% and car-sharing services, such as Zipcar and Car2Go, as viable alternatives to car ownership. So, if you’re in the car business, you’re really in the car-ownership business — not the car-sales business.
Innovative start-ups in the sector are already threatening to eat into dealerships’ customer base. Seattle-based Wrench sends certified auto mechanics to the customer’s door. RepairSmith , headquartered in Los Angeles and backed by a major investment commitment from Daimler AG /zigman2/quotes/201850364/delayed XE:DAI +2.69% /zigman2/quotes/203566154/composite DDAIF +3.03% , provides repair and maintenance at the customer’s choice of home, work or in the shop.
Toronto’s Tire Butler performs seasonal tire changes when and where they are wanted. Gas Ninja delivers gas wherever you are. This is ownership , spiraling around you, at your whim, at the tap of your phone and any way you like.